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90_SB0003ccr001
SRS90SB0003MNgeccr1
1 90TH GENERAL ASSEMBLY
2 CONFERENCE COMMITTEE REPORT
3 ON SENATE BILL 3
4 -------------------------------------------------------------
5 -------------------------------------------------------------
6 To the President of the Senate and the Speaker of the
7 House of Representatives:
8 We, the conference committee appointed to consider the
9 differences between the houses in relation to House Amendment
10 No. 1 to Senate Bill 3, recommend the following:
11 (1) that the House recede from House Amendment No. 1;
12 and
13 (2) that Senate Bill 3 be amended by replacing
14 everything after the enacting clause with the following:
15 "Section 5. The State Employees Group Insurance Act of
16 1971 is amended by changing Sections 3 and 10 as follows:
17 (5 ILCS 375/3) (from Ch. 127, par. 523)
18 Sec. 3. Definitions. Unless the context otherwise
19 requires, the following words and phrases as used in this Act
20 shall have the following meanings. The Department may define
21 these and other words and phrases separately for the purpose
22 of implementing specific programs providing benefits under
23 this Act.
24 (a) "Administrative service organization" means any
25 person, firm or corporation experienced in the handling of
26 claims which is fully qualified, financially sound and
27 capable of meeting the service requirements of a contract of
28 administration executed with the Department.
29 (b) "Annuitant" means (1) an employee who retires, or
30 has retired, on or after January 1, 1966 on an immediate
31 annuity under the provisions of Articles 2, 14, 15 (including
32 an employee who has retired under the optional retirement
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1 program established under Section 15-158.2), paragraphs (2),
2 (3), or (5) (b) or (c) of Section 16-106, or Article 18 of
3 the Illinois Pension Code; (2) any person who was receiving
4 group insurance coverage under this Act as of March 31, 1978
5 by reason of his status as an annuitant, even though the
6 annuity in relation to which such coverage was provided is a
7 proportional annuity based on less than the minimum period of
8 service required for a retirement annuity in the system
9 involved; (3) any person not otherwise covered by this Act
10 who has retired as a participating member under Article 2 of
11 the Illinois Pension Code but is ineligible for the
12 retirement annuity under Section 2-119 of the Illinois
13 Pension Code; (4) the spouse of any person who is receiving a
14 retirement annuity under Article 18 of the Illinois Pension
15 Code and who is covered under a group health insurance
16 program sponsored by a governmental employer other than the
17 State of Illinois and who has irrevocably elected to waive
18 his or her coverage under this Act and to have his or her
19 spouse considered as the "annuitant" under this Act and not
20 as a "dependent"; or (5) an employee who retires, or has
21 retired, from a qualified position, as determined according
22 to rules promulgated by the Director, under a qualified local
23 government or a qualified rehabilitation facility or a
24 qualified domestic violence shelter or service. (For
25 definition of "retired employee", see (p) post).
26 (b-5) "New SERS annuitant" means a person who, on or
27 after January 1, 1998, becomes an annuitant, as defined in
28 subsection (b), by virtue of beginning to receive a
29 retirement annuity under Article 14 of the Illinois Pension
30 Code, and is eligible to participate in the basic program of
31 group health benefits provided for annuitants under this Act.
32 (b-6) "New SURS annuitant" means a person who, on or
33 after January 1, 1998, becomes an annuitant, as defined in
34 subsection (b), by virtue of beginning to receive a
35 retirement annuity under Article 15 of the Illinois Pension
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1 Code, and is eligible to participate in the basic program of
2 group health benefits provided for annuitants under this Act.
3 (b-7) "New TRS State annuitant" means a person who, on
4 or after July 1, 1998, becomes an annuitant, as defined in
5 subsection (b), by virtue of beginning to receive a
6 retirement annuity under Article 16 of the Illinois Pension
7 Code based on service as a teacher as defined in paragraph
8 (2), (3), or (5) of Section 16-106 of that Code, and is
9 eligible to participate in the basic program of group health
10 benefits provided for annuitants under this Act.
11 (c) "Carrier" means (1) an insurance company, a
12 corporation organized under the Limited Health Service
13 Organization Act or the Voluntary Health Services Plan Act, a
14 partnership, or other nongovernmental organization, which is
15 authorized to do group life or group health insurance
16 business in Illinois, or (2) the State of Illinois as a
17 self-insurer.
18 (d) "Compensation" means salary or wages payable on a
19 regular payroll by the State Treasurer on a warrant of the
20 State Comptroller out of any State, trust or federal fund, or
21 by the Governor of the State through a disbursing officer of
22 the State out of a trust or out of federal funds, or by any
23 Department out of State, trust, federal or other funds held
24 by the State Treasurer or the Department, to any person for
25 personal services currently performed, and ordinary or
26 accidental disability benefits under Articles 2, 14, 15
27 (including ordinary or accidental disability benefits under
28 the optional retirement program established under Section
29 15-158.2), paragraphs (2), (3), or (5) (b) or (c) of Section
30 16-106, or Article 18 of the Illinois Pension Code, for
31 disability incurred after January 1, 1966, or benefits
32 payable under the Workers' Compensation or Occupational
33 Diseases Act or benefits payable under a sick pay plan
34 established in accordance with Section 36 of the State
35 Finance Act. "Compensation" also means salary or wages paid
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1 to an employee of any qualified local government or qualified
2 rehabilitation facility or a qualified domestic violence
3 shelter or service.
4 (e) "Commission" means the State Employees Group
5 Insurance Advisory Commission authorized by this Act.
6 Commencing July 1, 1984, "Commission" as used in this Act
7 means the Illinois Economic and Fiscal Commission as
8 established by the Legislative Commission Reorganization Act
9 of 1984.
10 (f) "Contributory", when referred to as contributory
11 coverage, shall mean optional coverages or benefits elected
12 by the member toward the cost of which such member makes
13 contribution, or which are funded in whole or in part through
14 the acceptance of a reduction in earnings or the foregoing of
15 an increase in earnings by an employee, as distinguished from
16 noncontributory coverage or benefits which are paid entirely
17 by the State of Illinois without reduction of the member's
18 salary.
19 (g) "Department" means any department, institution,
20 board, commission, officer, court or any agency of the State
21 government receiving appropriations and having power to
22 certify payrolls to the Comptroller authorizing payments of
23 salary and wages against such appropriations as are made by
24 the General Assembly from any State fund, or against trust
25 funds held by the State Treasurer and includes boards of
26 trustees of the retirement systems created by Articles 2, 14,
27 15, 16 and 18 of the Illinois Pension Code. "Department"
28 also includes the Illinois Comprehensive Health Insurance
29 Board, the Board of Examiners established under the Illinois
30 Public Accounting Act, and the Illinois Rural Bond Bank.
31 (h) "Dependent", when the term is used in the context of
32 the health and life plan, means a member's spouse and any
33 unmarried child (1) from birth to age 19 including an adopted
34 child, a child who lives with the member from the time of the
35 filing of a petition for adoption until entry of an order of
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1 adoption, a stepchild or recognized child who lives with the
2 member in a parent-child relationship, or a child who lives
3 with the member if such member is a court appointed guardian
4 of the child, or (2) age 19 to 23 enrolled as a full-time
5 student in any accredited school, financially dependent upon
6 the member, and eligible as a dependent for Illinois State
7 income tax purposes, or (3) age 19 or over who is mentally or
8 physically handicapped as defined in the Illinois Insurance
9 Code. For the health plan only, the term "dependent" also
10 includes any person enrolled prior to the effective date of
11 this Section who is dependent upon the member to the extent
12 that the member may claim such person as a dependent for
13 Illinois State income tax deduction purposes; no other such
14 person may be enrolled.
15 (i) "Director" means the Director of the Illinois
16 Department of Central Management Services.
17 (j) "Eligibility period" means the period of time a
18 member has to elect enrollment in programs or to select
19 benefits without regard to age, sex or health.
20 (k) "Employee" means and includes each officer or
21 employee in the service of a department who (1) receives his
22 compensation for service rendered to the department on a
23 warrant issued pursuant to a payroll certified by a
24 department or on a warrant or check issued and drawn by a
25 department upon a trust, federal or other fund or on a
26 warrant issued pursuant to a payroll certified by an elected
27 or duly appointed officer of the State or who receives
28 payment of the performance of personal services on a warrant
29 issued pursuant to a payroll certified by a Department and
30 drawn by the Comptroller upon the State Treasurer against
31 appropriations made by the General Assembly from any fund or
32 against trust funds held by the State Treasurer, and (2) is
33 employed full-time or part-time in a position normally
34 requiring actual performance of duty during not less than 1/2
35 of a normal work period, as established by the Director in
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1 cooperation with each department, except that persons elected
2 by popular vote will be considered employees during the
3 entire term for which they are elected regardless of hours
4 devoted to the service of the State, and (3) except that
5 "employee" does not include any person who is not eligible by
6 reason of such person's employment to participate in one of
7 the State retirement systems under Articles 2, 14, 15 (either
8 the regular Article 15 system or the optional retirement
9 program established under Section 15-158.2) or 18, or under
10 paragraph (2), (3), or (5) (b) or (c) of Section 16-106, of
11 the Illinois Pension Code, but such term does include persons
12 who are employed during the 6 month qualifying period under
13 Article 14 of the Illinois Pension Code. Such term also
14 includes any person who (1) after January 1, 1966, is
15 receiving ordinary or accidental disability benefits under
16 Articles 2, 14, 15 (including ordinary or accidental
17 disability benefits under the optional retirement program
18 established under Section 15-158.2), paragraphs (2), (3), or
19 (5) (b) or (c) of Section 16-106, or Article 18 of the
20 Illinois Pension Code, for disability incurred after January
21 1, 1966, (2) receives total permanent or total temporary
22 disability under the Workers' Compensation Act or
23 Occupational Disease Act as a result of injuries sustained or
24 illness contracted in the course of employment with the State
25 of Illinois, or (3) is not otherwise covered under this Act
26 and has retired as a participating member under Article 2 of
27 the Illinois Pension Code but is ineligible for the
28 retirement annuity under Section 2-119 of the Illinois
29 Pension Code. However, a person who satisfies the criteria
30 of the foregoing definition of "employee" except that such
31 person is made ineligible to participate in the State
32 Universities Retirement System by clause (4) of subsection
33 (a) of Section 15-107 of the Illinois Pension Code is also an
34 "employee" for the purposes of this Act. "Employee" also
35 includes any person receiving or eligible for benefits under
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1 a sick pay plan established in accordance with Section 36 of
2 the State Finance Act. "Employee" also includes each officer
3 or employee in the service of a qualified local government,
4 including persons appointed as trustees of sanitary districts
5 regardless of hours devoted to the service of the sanitary
6 district, and each employee in the service of a qualified
7 rehabilitation facility and each full-time employee in the
8 service of a qualified domestic violence shelter or service,
9 as determined according to rules promulgated by the Director.
10 (l) "Member" means an employee, annuitant, retired
11 employee or survivor.
12 (m) "Optional coverages or benefits" means those
13 coverages or benefits available to the member on his or her
14 voluntary election, and at his or her own expense.
15 (n) "Program" means the group life insurance, health
16 benefits and other employee benefits designed and contracted
17 for by the Director under this Act.
18 (o) "Health plan" means a self-insured health insurance
19 program offered by the State of Illinois for the purposes of
20 benefiting employees by means of providing, among others,
21 wellness programs, utilization reviews, second opinions and
22 medical fee reviews, as well as for paying for hospital and
23 medical care up to the maximum coverage provided by the plan,
24 to its members and their dependents.
25 (p) "Retired employee" means any person who would be an
26 annuitant as that term is defined herein but for the fact
27 that such person retired prior to January 1, 1966. Such term
28 also includes any person formerly employed by the University
29 of Illinois in the Cooperative Extension Service who would be
30 an annuitant but for the fact that such person was made
31 ineligible to participate in the State Universities
32 Retirement System by clause (4) of subsection (a) of Section
33 15-107 of the Illinois Pension Code.
34 (p-6) "New SURS retired employee" means a person who, on
35 or after January 1, 1998, becomes a retired employee, as
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1 defined in subsection (p), by virtue of being a person
2 formerly employed by the University of Illinois in the
3 Cooperative Extension Service who would be an annuitant but
4 for the fact that he or she was made ineligible to
5 participate in the State Universities Retirement System by
6 clause (4) of subsection (a) of Section 15-107 of the
7 Illinois Pension Code, and who is eligible to participate in
8 the basic program of group health benefits provided for
9 retired employees under this Act.
10 (q) "Survivor" means a person receiving an annuity as a
11 survivor of an employee or of an annuitant. "Survivor" also
12 includes: (1) the surviving dependent of a person who
13 satisfies the definition of "employee" except that such
14 person is made ineligible to participate in the State
15 Universities Retirement System by clause (4) of subsection
16 (a) of Section 15-107 of the Illinois Pension Code; and (2)
17 the surviving dependent of any person formerly employed by
18 the University of Illinois in the Cooperative Extension
19 Service who would be an annuitant except for the fact that
20 such person was made ineligible to participate in the State
21 Universities Retirement System by clause (4) of subsection
22 (a) of Section 15-107 of the Illinois Pension Code.
23 (q-5) "New SERS survivor" means a survivor, as defined
24 in subsection (q), whose annuity is paid under Article 14 of
25 the Illinois Pension Code and is based on the death of (i) an
26 employee whose death occurs on or after January 1, 1998, or
27 (ii) a new SERS annuitant as defined in subsection (b-5).
28 (q-6) "New SURS survivor" means a survivor, as defined
29 in subsection (q), whose annuity is paid under Article 15 of
30 the Illinois Pension Code and is based on the death of (i) an
31 employee whose death occurs on or after January 1, 1998, (ii)
32 a new SURS annuitant as defined in subsection (b-6), or (iii)
33 a new SURS retired employee as defined in subsection (p-6).
34 (q-7) "New TRS State survivor" means a survivor, as
35 defined in subsection (q), whose annuity is paid under
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1 Article 16 of the Illinois Pension Code and is based on the
2 death of (i) an employee who is a teacher as defined in
3 paragraph (2), (3), or (5) of Section 16-106 of that Code and
4 whose death occurs on or after July 1, 1998, or (ii) a new
5 TRS State annuitant as defined in subsection (b-7).
6 (r) "Medical services" means the services provided
7 within the scope of their licenses by practitioners in all
8 categories licensed under the Medical Practice Act of 1987.
9 (s) "Unit of local government" means any county,
10 municipality, township, school district, special district or
11 other unit, designated as a unit of local government by law,
12 which exercises limited governmental powers or powers in
13 respect to limited governmental subjects, any not-for-profit
14 association with a membership that primarily includes
15 townships and township officials, that has duties that
16 include provision of research service, dissemination of
17 information, and other acts for the purpose of improving
18 township government, and that is funded wholly or partly in
19 accordance with Section 85-15 of the Township Code; any
20 not-for-profit corporation or association, with a membership
21 consisting primarily of municipalities, that operates its own
22 utility system, and provides research, training,
23 dissemination of information, or other acts to promote
24 cooperation between and among municipalities that provide
25 utility services and for the advancement of the goals and
26 purposes of its membership; and the Illinois Association of
27 Park Districts. "Qualified local government" means a unit of
28 local government approved by the Director and participating
29 in a program created under subsection (i) of Section 10 of
30 this Act.
31 (t) "Qualified rehabilitation facility" means any
32 not-for-profit organization that is accredited by the
33 Commission on Accreditation of Rehabilitation Facilities or
34 certified by the Department of Human Services (as successor
35 to the Department of Mental Health and Developmental
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1 Disabilities) to provide services to persons with
2 disabilities and which receives funds from the State of
3 Illinois for providing those services, approved by the
4 Director and participating in a program created under
5 subsection (j) of Section 10 of this Act.
6 (u) "Qualified domestic violence shelter or service"
7 means any Illinois domestic violence shelter or service and
8 its administrative offices funded by the Department of Human
9 Services (as successor to the Illinois Department of Public
10 Aid), approved by the Director and participating in a program
11 created under subsection (k) of Section 10.
12 (v) "TRS benefit recipient" means a person who:
13 (1) is not a "member" as defined in this Section;
14 and
15 (2) is receiving a monthly benefit or retirement
16 annuity under Article 16 of the Illinois Pension Code;
17 and
18 (3) either (i) has at least 8 years of creditable
19 service under Article 16 of the Illinois Pension Code, or
20 (ii) was enrolled in the health insurance program offered
21 under that Article on January 1, 1996, or (iii) is the
22 survivor of a benefit recipient who had at least 8 years
23 of creditable service under Article 16 of the Illinois
24 Pension Code or was enrolled in the health insurance
25 program offered under that Article on the effective date
26 of this amendatory Act of 1995, or (iv) is a recipient or
27 survivor of a recipient of a disability benefit under
28 Article 16 of the Illinois Pension Code.
29 (w) "TRS dependent beneficiary" means a person who:
30 (1) is not a "member" or "dependent" as defined in
31 this Section; and
32 (2) is a TRS benefit recipient's: (A) spouse, (B)
33 dependent parent who is receiving at least half of his or
34 her support from the TRS benefit recipient, or (C)
35 unmarried natural or adopted child who is (i) under age
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1 19, or (ii) enrolled as a full-time student in an
2 accredited school, financially dependent upon the TRS
3 benefit recipient, eligible as a dependent for Illinois
4 State income tax purposes, and either is under age 24 or
5 was, on January 1, 1996, participating as a dependent
6 beneficiary in the health insurance program offered under
7 Article 16 of the Illinois Pension Code, or (iii) age 19
8 or over who is mentally or physically handicapped as
9 defined in the Illinois Insurance Code.
10 (x) "Military leave with pay and benefits" refers to
11 individuals in basic training for reserves, special/advanced
12 training, annual training, emergency call up, or activation
13 by the President of the United States with approved pay and
14 benefits.
15 (y) "Military leave without pay and benefits" refers to
16 individuals who enlist for active duty in a regular component
17 of the U.S. Armed Forces or other duty not specified or
18 authorized under military leave with pay and benefits.
19 (z) "Community college benefit recipient" means a person
20 who:
21 (1) is not a "member" as defined in this Section;
22 and
23 (2) is receiving a monthly survivor's annuity or
24 retirement annuity under Article 15 of the Illinois
25 Pension Code; and
26 (3) either (i) was a full-time employee of a
27 community college district or an association of community
28 college boards created under the Public Community College
29 Act (other than an employee whose last employer under
30 Article 15 of the Illinois Pension Code was a community
31 college district subject to Article VII of the Public
32 Community College Act) and was eligible to participate in
33 a group health benefit plan as an employee during the
34 time of employment with a community college district
35 (other than a community college district subject to
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1 Article VII of the Public Community College Act) or an
2 association of community college boards, or (ii) is the
3 survivor of a person described in item (i).
4 (aa) "Community college dependent beneficiary" means a
5 person who:
6 (1) is not a "member" or "dependent" as defined in
7 this Section; and
8 (2) is a community college benefit recipient's: (A)
9 spouse, (B) dependent parent who is receiving at least
10 half of his or her support from the community college
11 benefit recipient, or (C) unmarried natural or adopted
12 child who is (i) under age 19, or (ii) enrolled as a
13 full-time student in an accredited school, financially
14 dependent upon the community college benefit recipient,
15 eligible as a dependent for Illinois State income tax
16 purposes and under age 23, or (iii) age 19 or over and
17 mentally or physically handicapped as defined in the
18 Illinois Insurance Code.
19 (Source: P.A. 89-21, eff. 6-21-95; 89-25, eff. 6-21-95;
20 89-76, eff. 7-1-95; 89-324, eff. 8-13-95; 89-430, eff.
21 12-15-95; 89-502, eff. 7-1-96; 89-507, eff. 7-1-97; 89-628,
22 eff. 8-9-96; 90-14, eff. 7-1-97; 90-65, eff. 7-7-97; 90-448,
23 eff. 8-16-97; 90-497, eff. 8-18-97; 90-511, eff. 8-22-97;
24 revised 10-13-97.)
25 (5 ILCS 375/10) (from Ch. 127, par. 530)
26 Sec. 10. Payments by State; premiums.
27 (a) The State shall pay the cost of basic
28 non-contributory group life insurance and, subject to member
29 paid contributions set by the Department or required by this
30 Section, the basic program of group health benefits on each
31 eligible member, except a member, not otherwise covered by
32 this Act, who has retired as a participating member under
33 Article 2 of the Illinois Pension Code but is ineligible for
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1 the retirement annuity under Section 2-119 of the Illinois
2 Pension Code, and part of each eligible member's and retired
3 member's premiums for health insurance coverage for enrolled
4 dependents as provided by Section 9. The State shall pay the
5 cost of the basic program of group health benefits only after
6 benefits are reduced by the amount of benefits covered by
7 Medicare for all retired members and retired dependents aged
8 65 years or older who are entitled to benefits under Social
9 Security or the Railroad Retirement system or who had
10 sufficient Medicare-covered government employment except that
11 such reduction in benefits shall apply only to those retired
12 members or retired dependents who (1) first become eligible
13 for such Medicare coverage on or after July 1, 1992; or (2)
14 remain eligible for, but no longer receive Medicare coverage
15 which they had been receiving on or after July 1, 1992. The
16 Department may determine the aggregate level of the State's
17 contribution on the basis of actual cost of medical services
18 adjusted for age, sex or geographic or other demographic
19 characteristics which affect the costs of such programs.
20 (a-1) Beginning January 1, 1998, for each person who
21 becomes a new SERS annuitant and participates in the basic
22 program of group health benefits, the State shall contribute
23 toward the cost of the annuitant's coverage under the basic
24 program of group health benefits an amount equal to 5% of
25 that cost for each full year of creditable service upon which
26 the annuitant's retirement annuity is based, up to a maximum
27 of 100% for an annuitant with 20 or more years of creditable
28 service. The remainder of the cost of a new SERS annuitant's
29 coverage under the basic program of group health benefits
30 shall be the responsibility of the annuitant.
31 (a-2) Beginning January 1, 1998, for each person who
32 becomes a new SERS survivor and participates in the basic
33 program of group health benefits, the State shall contribute
34 toward the cost of the survivor's coverage under the basic
35 program of group health benefits an amount equal to 5% of
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1 that cost for each full year of the deceased employee's or
2 deceased annuitant's creditable service in the State
3 Employees' Retirement System of Illinois on the date of
4 death, up to a maximum of 100% for a survivor of an employee
5 or annuitant with 20 or more years of creditable service.
6 The remainder of the cost of the new SERS survivor's coverage
7 under the basic program of group health benefits shall be the
8 responsibility of the survivor.
9 (a-3) Beginning January 1, 1998, for each person who
10 becomes a new SURS annuitant and participates in the basic
11 program of group health benefits, the State shall contribute
12 toward the cost of the annuitant's coverage under the basic
13 program of group health benefits an amount equal to 5% of
14 that cost for each full year of creditable service upon which
15 the annuitant's retirement annuity is based, up to a maximum
16 of 100% for an annuitant with 20 or more years of creditable
17 service. The remainder of the cost of a new SURS annuitant's
18 coverage under the basic program of group health benefits
19 shall be the responsibility of the annuitant.
20 (a-4) Beginning January 1, 1998, for each person who
21 becomes a new SURS retired employee and participates in the
22 basic program of group health benefits, the State shall
23 contribute toward the cost of the retired employee's coverage
24 under the basic program of group health benefits an amount
25 equal to 5% of that cost for each full year that the retired
26 employee was an employee as defined in Section 3, up to a
27 maximum of 100% for a retired employee who was an employee
28 for 20 or more years. The remainder of the cost of a new
29 SURS retired employee's coverage under the basic program of
30 group health benefits shall be the responsibility of the
31 retired employee.
32 (a-5) Beginning January 1, 1998, for each person who
33 becomes a new SURS survivor and participates in the basic
34 program of group health benefits, the State shall contribute
35 toward the cost of the survivor's coverage under the basic
-15- SRS90SB0003MNgeccr1
1 program of group health benefits an amount equal to 5% of
2 that cost for each full year of the deceased employee's or
3 deceased annuitant's creditable service in the State
4 Universities Employees' Retirement System of Illinois on the
5 date of death, up to a maximum of 100% for a survivor of an
6 employee or annuitant with 20 or more years of creditable
7 service. The remainder of the cost of the new SURS
8 survivor's coverage under the basic program of group health
9 benefits shall be the responsibility of the survivor.
10 (a-6) Beginning July 1, 1998, for each person who
11 becomes a new TRS State annuitant and participates in the
12 basic program of group health benefits, the State shall
13 contribute toward the cost of the annuitant's coverage under
14 the basic program of group health benefits an amount equal to
15 5% of that cost for each full year of creditable service as a
16 teacher as defined in paragraph (2), (3), or (5) of Section
17 16-106 of the Illinois Pension Code upon which the
18 annuitant's retirement annuity is based, up to a maximum of
19 100% for an annuitant with 20 or more years of such
20 creditable service. The remainder of the cost of a new TRS
21 State annuitant's coverage under the basic program of group
22 health benefits shall be the responsibility of the annuitant.
23 (a-7) Beginning July 1, 1998, for each person who
24 becomes a new TRS State survivor and participates in the
25 basic program of group health benefits, the State shall
26 contribute toward the cost of the survivor's coverage under
27 the basic program of group health benefits an amount equal to
28 5% of that cost for each full year of the deceased employee's
29 or deceased annuitant's creditable service as a teacher as
30 defined in paragraph (2), (3), or (5) of Section 16-106 of
31 the Illinois Pension Code on the date of death, up to a
32 maximum of 100% for a survivor of an employee or annuitant
33 with 20 or more years of such creditable service. The
34 remainder of the cost of the new TRS State survivor's
35 coverage under the basic program of group health benefits
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1 shall be the responsibility of the survivor.
2 (a-8) (a-6) A new SERS annuitant, new SERS survivor, new
3 SURS annuitant, new SURS retired employee, or new SURS
4 survivor, new TRS State annuitant, or new TRS State survivor
5 may waive or terminate coverage in the program of group
6 health benefits. Any such annuitant, survivor, or retired
7 employee who has waived or terminated coverage may enroll or
8 re-enroll in the program of group health benefits only during
9 the annual benefit choice period, as determined by the
10 Director; except that in the event of termination of coverage
11 due to nonpayment of premiums, the annuitant, survivor, or
12 retired employee may not re-enroll in the program.
13 (a-9) (a-7) No later than May 1 of each calendar year,
14 the Director of Central Management Services shall certify in
15 writing to the Executive Secretary of the State Employee's
16 Retirement System the amounts of the Medicare supplement
17 health care premiums and the amounts of the health care
18 premiums for all other retirees who are not Medicare
19 eligible.
20 A separate calculation of the premiums based upon the
21 actual cost of each health care plan shall be so certified.
22 The Director of Central Management Services shall provide
23 to the Executive Secretary of the State Employee's Retirement
24 System such information, statistics, and other data as he or
25 she he/she may require to review the premium amounts
26 certified by the Director of Central Management Services.
27 (b) State employees who become eligible for this program
28 on or after January 1, 1980 in positions, normally requiring
29 actual performance of duty not less than 1/2 of a normal work
30 period but not equal to that of a normal work period, shall
31 be given the option of participating in the available
32 program. If the employee elects coverage, the State shall
33 contribute on behalf of such employee to the cost of the
34 employee's benefit and any applicable dependent supplement,
35 that sum which bears the same percentage as that percentage
-17- SRS90SB0003MNgeccr1
1 of time the employee regularly works when compared to normal
2 work period.
3 (c) The basic non-contributory coverage from the basic
4 program of group health benefits shall be continued for each
5 employee not in pay status or on active service by reason of
6 (1) leave of absence due to illness or injury, (2) authorized
7 educational leave of absence or sabbatical leave, or (3)
8 military leave with pay and benefits. This coverage shall
9 continue until expiration of authorized leave and return to
10 active service, but not to exceed 24 months for leaves under
11 item (1) or (2). This 24-month limitation and the requirement
12 of returning to active service shall not apply to persons
13 receiving ordinary or accidental disability benefits or
14 retirement benefits through the appropriate State retirement
15 system or benefits under the Workers' Compensation or
16 Occupational Disease Act.
17 (d) The basic group life insurance coverage shall
18 continue, with full State contribution, where such person is
19 (1) absent from active service by reason of disability
20 arising from any cause other than self-inflicted, (2) on
21 authorized educational leave of absence or sabbatical leave,
22 or (3) on military leave with pay and benefits.
23 (e) Where the person is in non-pay status for a period
24 in excess of 30 days or on leave of absence, other than by
25 reason of disability, educational or sabbatical leave, or
26 military leave with pay and benefits, such person may
27 continue coverage only by making personal payment equal to
28 the amount normally contributed by the State on such person's
29 behalf. Such payments and coverage may be continued: (1)
30 until such time as the person returns to a status eligible
31 for coverage at State expense, but not to exceed 24 months,
32 (2) until such person's employment or annuitant status with
33 the State is terminated, or (3) for a maximum period of 4
34 years for members on military leave with pay and benefits and
35 military leave without pay and benefits (exclusive of any
-18- SRS90SB0003MNgeccr1
1 additional service imposed pursuant to law).
2 (f) The Department shall establish by rule the extent
3 to which other employee benefits will continue for persons in
4 non-pay status or who are not in active service.
5 (g) The State shall not pay the cost of the basic
6 non-contributory group life insurance, program of health
7 benefits and other employee benefits for members who are
8 survivors as defined by paragraphs (1) and (2) of subsection
9 (q) of Section 3 of this Act. The costs of benefits for
10 these survivors shall be paid by the survivors or by the
11 University of Illinois Cooperative Extension Service, or any
12 combination thereof.
13 (h) Those persons occupying positions with any
14 department as a result of emergency appointments pursuant to
15 Section 8b.8 of the Personnel Code who are not considered
16 employees under this Act shall be given the option of
17 participating in the programs of group life insurance, health
18 benefits and other employee benefits. Such persons electing
19 coverage may participate only by making payment equal to the
20 amount normally contributed by the State for similarly
21 situated employees. Such amounts shall be determined by the
22 Director. Such payments and coverage may be continued until
23 such time as the person becomes an employee pursuant to this
24 Act or such person's appointment is terminated.
25 (i) Any unit of local government within the State of
26 Illinois may apply to the Director to have its employees,
27 annuitants, and their dependents provided group health
28 coverage under this Act on a non-insured basis. To
29 participate, a unit of local government must agree to enroll
30 all of its employees, who may select coverage under either
31 the State group health insurance plan or a health maintenance
32 organization that has contracted with the State to be
33 available as a health care provider for employees as defined
34 in this Act. A unit of local government must remit the
35 entire cost of providing coverage under the State group
-19- SRS90SB0003MNgeccr1
1 health insurance plan or, for coverage under a health
2 maintenance organization, an amount determined by the
3 Director based on an analysis of the sex, age, geographic
4 location, or other relevant demographic variables for its
5 employees, except that the unit of local government shall not
6 be required to enroll those of its employees who are covered
7 spouses or dependents under this plan or another group policy
8 or plan providing health benefits as long as (1) an
9 appropriate official from the unit of local government
10 attests that each employee not enrolled is a covered spouse
11 or dependent under this plan or another group policy or plan,
12 and (2) at least 85% of the employees are enrolled and the
13 unit of local government remits the entire cost of providing
14 coverage to those employees. Employees of a participating
15 unit of local government who are not enrolled due to coverage
16 under another group health policy or plan may enroll at a
17 later date subject to submission of satisfactory evidence of
18 insurability and provided that no benefits shall be payable
19 for services incurred during the first 6 months of coverage
20 to the extent the services are in connection with any
21 pre-existing condition. A participating unit of local
22 government may also elect to cover its annuitants. Dependent
23 coverage shall be offered on an optional basis, with the
24 costs paid by the unit of local government, its employees, or
25 some combination of the two as determined by the unit of
26 local government. The unit of local government shall be
27 responsible for timely collection and transmission of
28 dependent premiums.
29 The Director shall annually determine monthly rates of
30 payment, subject to the following constraints:
31 (1) In the first year of coverage, the rates shall
32 be equal to the amount normally charged to State
33 employees for elected optional coverages or for enrolled
34 dependents coverages or other contributory coverages, or
35 contributed by the State for basic insurance coverages on
-20- SRS90SB0003MNgeccr1
1 behalf of its employees, adjusted for differences between
2 State employees and employees of the local government in
3 age, sex, geographic location or other relevant
4 demographic variables, plus an amount sufficient to pay
5 for the additional administrative costs of providing
6 coverage to employees of the unit of local government and
7 their dependents.
8 (2) In subsequent years, a further adjustment shall
9 be made to reflect the actual prior years' claims
10 experience of the employees of the unit of local
11 government.
12 In the case of coverage of local government employees
13 under a health maintenance organization, the Director shall
14 annually determine for each participating unit of local
15 government the maximum monthly amount the unit may contribute
16 toward that coverage, based on an analysis of (i) the age,
17 sex, geographic location, and other relevant demographic
18 variables of the unit's employees and (ii) the cost to cover
19 those employees under the State group health insurance plan.
20 The Director may similarly determine the maximum monthly
21 amount each unit of local government may contribute toward
22 coverage of its employees' dependents under a health
23 maintenance organization.
24 Monthly payments by the unit of local government or its
25 employees for group health insurance or health maintenance
26 organization coverage shall be deposited in the Local
27 Government Health Insurance Reserve Fund. The Local
28 Government Health Insurance Reserve Fund shall be a
29 continuing fund not subject to fiscal year limitations. All
30 expenditures from this fund shall be used for payments for
31 health care benefits for local government and rehabilitation
32 facility employees, annuitants, and dependents, and to
33 reimburse the Department or its administrative service
34 organization for all expenses incurred in the administration
35 of benefits. No other State funds may be used for these
-21- SRS90SB0003MNgeccr1
1 purposes.
2 A local government employer's participation or desire to
3 participate in a program created under this subsection shall
4 not limit that employer's duty to bargain with the
5 representative of any collective bargaining unit of its
6 employees.
7 (j) Any rehabilitation facility within the State of
8 Illinois may apply to the Director to have its employees,
9 annuitants, and their dependents provided group health
10 coverage under this Act on a non-insured basis. To
11 participate, a rehabilitation facility must agree to enroll
12 all of its employees and remit the entire cost of providing
13 such coverage for its employees, except that the
14 rehabilitation facility shall not be required to enroll those
15 of its employees who are covered spouses or dependents under
16 this plan or another group policy or plan providing health
17 benefits as long as (1) an appropriate official from the
18 rehabilitation facility attests that each employee not
19 enrolled is a covered spouse or dependent under this plan or
20 another group policy or plan, and (2) at least 85% of the
21 employees are enrolled and the rehabilitation facility remits
22 the entire cost of providing coverage to those employees.
23 Employees of a participating rehabilitation facility who are
24 not enrolled due to coverage under another group health
25 policy or plan may enroll at a later date subject to
26 submission of satisfactory evidence of insurability and
27 provided that no benefits shall be payable for services
28 incurred during the first 6 months of coverage to the extent
29 the services are in connection with any pre-existing
30 condition. A participating rehabilitation facility may also
31 elect to cover its annuitants. Dependent coverage shall be
32 offered on an optional basis, with the costs paid by the
33 rehabilitation facility, its employees, or some combination
34 of the 2 as determined by the rehabilitation facility. The
35 rehabilitation facility shall be responsible for timely
-22- SRS90SB0003MNgeccr1
1 collection and transmission of dependent premiums.
2 The Director shall annually determine quarterly rates of
3 payment, subject to the following constraints:
4 (1) In the first year of coverage, the rates shall
5 be equal to the amount normally charged to State
6 employees for elected optional coverages or for enrolled
7 dependents coverages or other contributory coverages on
8 behalf of its employees, adjusted for differences between
9 State employees and employees of the rehabilitation
10 facility in age, sex, geographic location or other
11 relevant demographic variables, plus an amount sufficient
12 to pay for the additional administrative costs of
13 providing coverage to employees of the rehabilitation
14 facility and their dependents.
15 (2) In subsequent years, a further adjustment shall
16 be made to reflect the actual prior years' claims
17 experience of the employees of the rehabilitation
18 facility.
19 Monthly payments by the rehabilitation facility or its
20 employees for group health insurance shall be deposited in
21 the Local Government Health Insurance Reserve Fund.
22 (k) Any domestic violence shelter or service within the
23 State of Illinois may apply to the Director to have its
24 employees, annuitants, and their dependents provided group
25 health coverage under this Act on a non-insured basis. To
26 participate, a domestic violence shelter or service must
27 agree to enroll all of its employees and pay the entire cost
28 of providing such coverage for its employees. A
29 participating domestic violence shelter may also elect to
30 cover its annuitants. Dependent coverage shall be offered on
31 an optional basis, with employees, or some combination of the
32 2 as determined by the domestic violence shelter or service.
33 The domestic violence shelter or service shall be responsible
34 for timely collection and transmission of dependent premiums.
35 The Director shall annually determine quarterly rates of
-23- SRS90SB0003MNgeccr1
1 payment, subject to the following constraints:
2 (1) In the first year of coverage, the rates shall
3 be equal to the amount normally charged to State
4 employees for elected optional coverages or for enrolled
5 dependents coverages or other contributory coverages on
6 behalf of its employees, adjusted for differences between
7 State employees and employees of the domestic violence
8 shelter or service in age, sex, geographic location or
9 other relevant demographic variables, plus an amount
10 sufficient to pay for the additional administrative costs
11 of providing coverage to employees of the domestic
12 violence shelter or service and their dependents.
13 (2) In subsequent years, a further adjustment shall
14 be made to reflect the actual prior years' claims
15 experience of the employees of the domestic violence
16 shelter or service.
17 (3) In no case shall the rate be less than the
18 amount normally charged to State employees or contributed
19 by the State on behalf of its employees.
20 Monthly payments by the domestic violence shelter or
21 service or its employees for group health insurance shall be
22 deposited in the Local Government Health Insurance Reserve
23 Fund.
24 (l) A public community college or entity organized
25 pursuant to the Public Community College Act may apply to the
26 Director initially to have only annuitants not covered prior
27 to July 1, 1992 by the district's health plan provided health
28 coverage under this Act on a non-insured basis. The
29 community college must execute a 2-year contract to
30 participate in the Local Government Health Plan. Those
31 annuitants enrolled initially under this contract shall have
32 no benefits payable for services incurred during the first 6
33 months of coverage to the extent the services are in
34 connection with any pre-existing condition. Any annuitant
35 who may enroll after this initial enrollment period shall be
-24- SRS90SB0003MNgeccr1
1 subject to submission of satisfactory evidence of
2 insurability and to the pre-existing conditions limitation.
3 The Director shall annually determine monthly rates of
4 payment subject to the following constraints: for those
5 community colleges with annuitants only enrolled, first year
6 rates shall be equal to the average cost to cover claims for
7 a State member adjusted for demographics, Medicare
8 participation, and other factors; and in the second year, a
9 further adjustment of rates shall be made to reflect the
10 actual first year's claims experience of the covered
11 annuitants.
12 (m) The Director shall adopt any rules deemed necessary
13 for implementation of this amendatory Act of 1989 (Public Act
14 86-978).
15 (Source: P.A. 89-53, eff. 7-1-95; 89-236, eff. 8-4-95;
16 89-324, eff. 8-13-95; 89-626, eff. 8-9-96; 90-65, eff.
17 7-7-97.)
18 Section 10. The Illinois Pension Code is amended by
19 changing Sections 16-133, 16-152, and 16-158 and adding
20 Section 16-129.1 as follows:
21 (40 ILCS 5/16-129.1 new)
22 Sec. 16-129.1. Optional increase in retirement annuity.
23 (a) A member of the System may qualify for the augmented
24 rate under subdivision (a)(B)(1) of Section 16-133 for all
25 years of creditable service earned before July 1, 1998 by
26 making the optional contribution specified in subsection (b).
27 A member may not elect to qualify for the augmented rate for
28 only a portion of his or her creditable service earned before
29 July 1, 1998.
30 (b) The contribution shall be an amount equal to 0.85%
31 of the member's highest salary rate in the 4 consecutive
32 years of service immediately prior to the date of
33 application, multiplied by the number of years by which the
-25- SRS90SB0003MNgeccr1
1 amount of creditable service earned by the member before July
2 1, 1998 exceeds the amount of creditable service earned by
3 the member after June 30, 1998; subject to a maximum
4 contribution of 17% of that salary rate.
5 The member shall pay to the System the amount of the
6 contribution as calculated at the time of application under
7 this Section. The amount of the contribution determined
8 under this subsection shall be recalculated at the time of
9 retirement, and if the System determines that the amount paid
10 by the member exceeds the recalculated amount, the System
11 shall refund the difference to the member with regular
12 interest from the date of payment to the date of refund.
13 The contribution required by this subsection shall be
14 paid in one of the following ways or in a combination of the
15 following ways that does not extend over more than 5 years:
16 (i) in a lump sum on or before the date of
17 retirement;
18 (ii) in substantially equal installments over a
19 period of time not to exceed 5 years, as a deduction from
20 salary in accordance with subsection (b) of Section
21 16-154;
22 (iii) if the member becomes an annuitant before
23 June 30, 2003, in substantially equal monthly
24 installments over a 24-month period, by a deduction from
25 the annuitant's monthly benefit.
26 (c) If the member fails to make the full contribution
27 under this Section in a timely fashion, the payments made
28 under this Section shall be refunded to the member, without
29 interest. If the member dies before making the full
30 contribution, the payments made under this Section, together
31 with regular interest thereon, shall be refunded to the
32 member's estate.
33 (d) For purposes of this Section and subdivision
34 (a)(B)(1) of Section 16-133, optional creditable service
35 established by a member shall be deemed to have been earned
-26- SRS90SB0003MNgeccr1
1 at the time of the employment or other qualifying event upon
2 which the service is based, rather than at the time the
3 credit was established in this System.
4 (40 ILCS 5/16-133) (from Ch. 108 1/2, par. 16-133)
5 Sec. 16-133. Retirement annuity; amount.
6 (a) The amount of the retirement annuity shall be the
7 larger of the amounts determined under paragraphs (A) and (B)
8 below:
9 (A) An amount consisting of the sum of the
10 following:
11 (1) An amount that can be provided on an
12 actuarially equivalent basis by the member's
13 accumulated contributions at the time of retirement;
14 and
15 (2) The sum of (i) the amount that can be
16 provided on an actuarially equivalent basis by the
17 member's accumulated contributions representing
18 service prior to July 1, 1947, and (ii) the amount
19 that can be provided on an actuarially equivalent
20 basis by the amount obtained by multiplying 1.4
21 times the member's accumulated contributions
22 covering service subsequent to June 30, 1947; and
23 (3) If there is prior service, 2 times the
24 amount that would have been determined under
25 subparagraph (2) of paragraph (A) above on account
26 of contributions which would have been made during
27 the period of prior service creditable to the member
28 had the System been in operation and had the member
29 made contributions at the contribution rate in
30 effect prior to July 1, 1947.
31 (B) An amount consisting of the greater of the
32 following:
33 (1) For creditable service earned before July
34 1, 1998 that has not been augmented under Section
-27- SRS90SB0003MNgeccr1
1 16-129.1: 1.67% of final average salary for each of
2 the first 10 years of creditable service, 1.90% of
3 final average salary for each year in excess of 10
4 but not exceeding 20, 2.10% of final average salary
5 for each year in excess of 20 but not exceeding 30,
6 and 2.30% of final average salary for each year in
7 excess of 30; and
8 For creditable service earned on or after July
9 1, 1998 by a member who has at least 30 years of
10 creditable service on July 1, 1998 and who does not
11 elect to augment service under Section 16-129.1:
12 2.3% of final average salary for each year of
13 creditable service earned on or after July 1, 1998;
14 and
15 For all other creditable service: 2.2% of
16 final average salary for each year of creditable
17 service; or
18 (2) 1.5% 1 1/2% of final average salary for
19 each year of creditable service plus the sum $7.50
20 for each of the first 20 years of creditable
21 service.
22 The amount of the retirement annuity determined under
23 this paragraph (B) shall be reduced by 1/2 of 1% for each
24 month that the member is less than age 60 at the time the
25 retirement annuity begins. However, this reduction shall
26 not apply (i) if the member has at least 35 years of
27 creditable service, or (ii) if the member retires on
28 account of disability under Section 16-149.2 of this
29 Article with at least 20 years of creditable service.
30 (b) For purposes of this Section, final average salary
31 shall be the average salary for the highest 4 consecutive
32 years within the last 10 years of creditable service as
33 determined under rules of the board. The minimum final
34 average salary shall be considered to be $2,400 per year.
35 In the determination of final average salary for members
-28- SRS90SB0003MNgeccr1
1 other than elected officials and their appointees when such
2 appointees are allowed by statute, that part of a member's
3 salary for any year beginning after June 30, 1979 which
4 exceeds the member's annual full-time salary rate with the
5 same employer for the preceding year by more than 20% shall
6 be excluded.
7 (c) In determining the amount of the retirement annuity
8 under paragraph (B) of this Section, a fractional year shall
9 be granted proportional credit.
10 (d) The retirement annuity determined under paragraph
11 (B) of this Section shall be available only to members who
12 render teaching service after July 1, 1947 for which member
13 contributions are required, and to annuitants who re-enter
14 under the provisions of Section 16-150.
15 (e) The maximum retirement annuity provided under
16 paragraph (B) of this Section shall be 75% of final average
17 salary.
18 (Source: P.A. 86-273; 87-794; 87-1265.)
19 (40 ILCS 5/16-152) (from Ch. 108 1/2, par. 16-152)
20 Sec. 16-152. Contributions by members.
21 (a) Each member shall make contributions for membership
22 service to this System as follows:
23 (1) Effective July 1, 1998 1971, contributions of 7.35%
24 6 1/2% of salary towards the cost of the retirement annuity.
25 Such contributions shall be deemed "normal contributions".
26 (2) Effective July 1, 1969, contributions of 1/2 of 1%
27 of salary toward the cost of the automatic annual increase in
28 retirement annuity provided under Section 16-133.1.
29 (3) Effective July 24, 1959, contributions of 1% of
30 salary towards the cost of survivor benefits. Such
31 contributions shall not be credited to the individual account
32 of the member and shall not be subject to refund except as
33 provided under Section 16-143.2.
34 (b) The minimum required contribution for any year of
-29- SRS90SB0003MNgeccr1
1 full-time teaching service shall be $192.
2 (c) Contributions shall not be required of any annuitant
3 receiving a retirement annuity who is given temporary
4 employment not exceeding that permitted under Section 16-118.
5 (d) A person who (i) was a member before July 1, 1998,
6 (ii) retires with more than 34 years of creditable service,
7 and (iii) does not elect to qualify for the augmented rate
8 under Section 16-129.1 shall be entitled, at the time of
9 retirement, to receive a partial refund of contributions made
10 under this Section for service occurring after the later of
11 June 30, 1998 or attainment of 34 years of creditable
12 service, in an amount equal to 0.85% of the salary upon which
13 those contributions were based.
14 (Source: P.A. 83-1440.)
15 (40 ILCS 5/16-158) (from Ch. 108 1/2, par. 16-158)
16 Sec. 16-158. Contributions by State and other employing
17 units.
18 (a) The State shall make contributions to the System by
19 means of appropriations from the Common School Fund and other
20 State funds of amounts which, together with other employer
21 contributions, employee contributions, investment income, and
22 other income, will be sufficient to meet the cost of
23 maintaining and administering the System on a 90% funded
24 basis in accordance with actuarial recommendations.
25 The Board shall determine the amount of State
26 contributions required for each fiscal year on the basis of
27 the actuarial tables and other assumptions adopted by the
28 Board and the recommendations of the actuary, using the
29 formula in subsection (b-3).
30 (a-1) Annually, on or before November 15, the board
31 shall certify to the Governor the amount of the required
32 State contribution for the coming fiscal year. The
33 certification shall include a copy of the actuarial
34 recommendations upon which it is based.
-30- SRS90SB0003MNgeccr1
1 (b) Through State fiscal year 1995, the State
2 contributions shall be paid to the System in accordance with
3 Section 18-7 of the School Code.
4 (b-1) Beginning in State fiscal year 1996, on the 15th
5 day of each month, or as soon thereafter as may be
6 practicable, the Board shall submit vouchers for payment of
7 State contributions to the System, in a total monthly amount
8 of one-twelfth of the required annual State contribution
9 certified under subsection (a-1). These vouchers shall be
10 paid by the State Comptroller and Treasurer by warrants drawn
11 on the funds appropriated to the System for that fiscal year.
12 If in any month the amount remaining unexpended from all
13 other appropriations to the System for the applicable fiscal
14 year (including the appropriations to the System under
15 Section 8.12 of the State Finance Act and Section 1 of the
16 State Pension Funds Continuing Appropriation Act) is less
17 than the amount lawfully vouchered under this subsection, the
18 difference shall be paid from the Common School Fund under
19 the continuing appropriation authority provided in Section
20 1.1 of the State Pension Funds Continuing Appropriation Act.
21 (b-2) Allocations from the Common School Fund
22 apportioned to school districts not coming under this System
23 shall not be diminished or affected by the provisions of this
24 Article.
25 (b-3) For State fiscal years 2011 through 2045, the
26 minimum contribution to the System to be made by the State
27 for each fiscal year shall be an amount determined by the
28 System to be sufficient to bring the total assets of the
29 System up to 90% of the total actuarial liabilities of the
30 System by the end of State fiscal year 2045. In making these
31 determinations, the required State contribution shall be
32 calculated each year as a level percentage of payroll over
33 the years remaining to and including fiscal year 2045 and
34 shall be determined under the projected unit credit actuarial
35 cost method.
-31- SRS90SB0003MNgeccr1
1 For State fiscal years 1996 through 2010, the State
2 contribution to the System, as a percentage of the applicable
3 employee payroll, shall be increased in equal annual
4 increments so that by State fiscal year 2011, the State is
5 contributing at the rate required under this Section; except
6 that in the following specified State fiscal years, the State
7 contribution to the System shall not be less than the
8 following indicated percentages of the applicable employee
9 payroll, even if the indicated percentage will produce a
10 State contribution in excess of the amount otherwise required
11 under this subsection and subsection (a), and notwithstanding
12 any contrary certification made under subsection (a-1) before
13 the effective date of this amendatory Act of 1997: 9.932% in
14 FY 1999; 10.632% in FY 2000; 11.332% in FY 2001; 12.022% in
15 FY 2002; 12.722% in FY 2003; 13.422% in FY 2004; 14.112% in
16 FY 2005; 14.812% in FY 2006; 15.512% in FY 2007; 16.202% in
17 FY 2008; 16.902% in FY 2009; and 17.602% in FY 2010.
18 Beginning in State fiscal year 2046, the minimum State
19 contribution for each fiscal year shall be the amount needed
20 to maintain the total assets of the System at 90% of the
21 total actuarial liabilities of the System.
22 (c) Payment of the required State contributions and of
23 all pensions, retirement annuities, death benefits, refunds,
24 and other benefits granted under or assumed by this System,
25 and all expenses in connection with the administration and
26 operation thereof, are obligations of the State.
27 If members are paid from special trust or federal funds
28 which are administered by the employing unit, whether school
29 district or other unit, the employing unit shall pay to the
30 System from such funds the full accruing retirement costs
31 based upon that service, as determined by the System.
32 Employer contributions, based on salary paid to members from
33 federal funds, may be forwarded by the distributing agency of
34 the State of Illinois to the System prior to allocation, in
35 an amount determined in accordance with guidelines
-32- SRS90SB0003MNgeccr1
1 established by such agency and the System.
2 (d) Effective July 1, 1986, any employer of a teacher as
3 defined in paragraph (8) of Section 16-106 shall pay the
4 employer's normal cost of benefits based upon the teacher's
5 service, in addition to employee contributions, as determined
6 by the System. Such employer contributions shall be
7 forwarded monthly in accordance with guidelines established
8 by the System.
9 However, with respect to benefits granted under Section
10 16-133.4 or 16-133.5 to a teacher as defined in paragraph (8)
11 of Section 16-106, the employer's contribution shall be 12%
12 (rather than 20%) of the member's highest annual salary rate
13 for each year of creditable service granted, and the employer
14 shall also pay the required employee contribution on behalf
15 of the teacher. For the purposes of Sections 16-133.4 and
16 16-133.5, a teacher as defined in paragraph (8) of Section
17 16-106 who is serving in that capacity while on leave of
18 absence from another employer under this Article shall not be
19 considered an employee of the employer from which the teacher
20 is on leave.
21 (e) Beginning July 1, 1998, every employer of a teacher
22 shall pay to the System an employer contribution computed as
23 follows:
24 (1) Beginning July 1, 1998 through June 30, 1999,
25 the employer contribution shall be equal to 0.3% of each
26 teacher's salary.
27 (2) Beginning July 1, 1999 through June 30, 2000,
28 the employer contribution shall be equal to 0.6% of each
29 teacher's salary.
30 (3) Beginning July 1, 2000 and thereafter, the
31 employer contribution shall be equal to 0.9% of each
32 teacher's salary.
33 The school district or other employing unit may pay these
34 employer contributions out of any source of funding available
35 for that purpose and shall forward the contributions to the
-33- SRS90SB0003MNgeccr1
1 System on the schedule established for the payment of member
2 contributions.
3 These employer contributions are intended to offset a
4 portion of the cost to the System of the increases in
5 retirement benefits resulting from this amendatory Act of
6 1997.
7 (Source: P.A. 87-1265; 88-593, eff. 8-22-94.)
8 Section 15. The Illinois Pension Code is amended by
9 changing Sections 17-116, 17-127, 17-129, and 17-130 and
10 adding Sections 17-119.1, 17-127.2, and 17-130.2 as follows:
11 (40 ILCS 5/17-116) (from Ch. 108 1/2, par. 17-116)
12 Sec. 17-116. Service retirement pension.
13 (a) Each teacher having 20 years of service upon
14 attainment of age 55, or who thereafter attains age 55 shall
15 be entitled to a service retirement pension upon or after
16 attainment of age 55; and each teacher in service on or after
17 July 1, 1971, with 5 or more but less than 20 years of
18 service shall be entitled to receive a service retirement
19 pension upon or after attainment of age 62. Such pension is
20 to be calculated as follows:
21 (b) Beginning as of June 25, 1971, The service
22 retirement pension for a teacher who retires on or after June
23 25, 1971 such date, at age 60 or over, shall be calculated as
24 follows:
25 (1) For creditable service earned before July 1,
26 1998 that has not been augmented under Section 17-119.1:
27 1.67% for each of the first 10 years of service; 1.90%
28 for each of the next 10 years of service; 2.10% for each
29 year of service in excess of 20 but not exceeding 30; and
30 2.30% for each year of service in excess of 30, based
31 upon average salary as herein defined.
32 (2) For creditable service earned on or after July
33 1, 1998 by a member who has at least 30 years of
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1 creditable service on July 1, 1998 and who does not elect
2 to augment service under Section 17-119.1: 2.3% of
3 average salary for each year of creditable service earned
4 on or after July 1, 1998.
5 (3) For all other creditable service: 2.2% of
6 average salary for each year of creditable service.
7 (c) When computing such service retirement pensions, the
8 following conditions shall apply:
9 1. Average salary shall consist of the average annual
10 rate of salary for the 4 consecutive years of validated
11 service within the last 10 years of service when such average
12 annual rate was highest. In the determination of average
13 salary for retirement allowance purposes, for members who
14 commenced employment after August 31, 1979, that part of the
15 salary for any year shall be excluded which exceeds the
16 annual full-time salary rate for the preceding year by more
17 than 20%. In the case of a member who commenced employment
18 before August 31, 1979 and who receives salary during any
19 year after September 1, 1983 which exceeds the annual full
20 time salary rate for the preceding year by more than 20%, the
21 Board of Education or employer shall pay to the Fund an
22 amount equal to the present value of the additional service
23 retirement pension resulting from such excess salary. The
24 present value of the additional service retirement pension
25 shall be computed by the Board on the basis of actuarial
26 tables adopted by the Board. If a member elects to receive a
27 pension from this fund provided by Section 20-121, his salary
28 under the State Universities Retirement System and the
29 Teachers' Retirement System of the State of Illinois shall be
30 considered in determining such average salary. Amounts paid
31 after the effective date of this amendatory Act of 1991 for
32 unused vacation time earned after that effective date shall
33 not under any circumstances be included in the calculation of
34 average salary or the annual rate of salary for the purposes
35 of this Article.
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1 2. Proportionate credit shall be given for validated
2 service of less than one year.
3 3. For retirement at age 60 or over the pension shall be
4 payable at the full rate.
5 4. For separation from service below age 60 to a minimum
6 age of 55, the pension shall be discounted at the rate of
7 1/2 of one per cent for each month that the age of the
8 contributor is less than 60, but a teacher may elect to defer
9 the effective date of pension in order to eliminate or reduce
10 this discount. This discount shall not be applicable to any
11 participant who has at least 35 years of service on the date
12 the retirement annuity begins.
13 5. No additional pension shall be granted for service
14 exceeding 45 years. Beginning June 26, 1971 no pension shall
15 exceed the greater of $1,500 per month or 75% of average
16 salary as herein defined.
17 6. Service retirement pensions shall begin on the
18 effective date of resignation, retirement, the day following
19 the close of the payroll period for which service credit was
20 validated, or the time the person resigning or retiring
21 attains age 55, or on a date elected by the teacher,
22 whichever shall be latest.
23 (Source: P.A. 86-1488.)
24 (40 ILCS 5/17-119.1 new)
25 Sec. 17-119.1. Optional increase in retirement annuity.
26 (a) A member of the Fund may qualify for the augmented
27 rate under subdivision (b)(3) of Section 17-116 for all years
28 of creditable service earned before July 1, 1998 by making
29 the optional contribution specified in subsection (b). A
30 member may not elect to qualify for the augmented rate for
31 only a portion of his or her creditable service earned before
32 July 1, 1998.
33 (b) The contribution shall be an amount equal to 0.85%
34 of the member's highest salary rate in the 4 consecutive
-36- SRS90SB0003MNgeccr1
1 years of service immediately prior to the date of
2 application, multiplied by the number of years by which the
3 amount of creditable service earned by the member before July
4 1, 1998 exceeds the amount of creditable service earned by
5 the member after June 30, 1998; subject to a maximum
6 contribution of 17% of that salary rate.
7 The member shall pay to the Fund the amount of the
8 contribution as calculated at the time of application under
9 this Section. The amount of the contribution determined
10 under this subsection shall be recalculated at the time of
11 retirement, and if the Fund determines that the amount paid
12 by the member exceeds the recalculated amount, the Fund shall
13 refund the difference to the member.
14 The contribution required by this subsection shall be
15 paid in one of the following ways or in a combination of the
16 following ways that does not extend over more than 5 years:
17 (i) in a lump sum on or before the date of
18 retirement;
19 (ii) in substantially equal installments over a
20 period of time not to exceed 5 years, as a deduction from
21 salary in accordance with Section 17-130.2;
22 (iii) if the member becomes an annuitant before
23 June 30, 2003, in substantially equal monthly
24 installments over a 24-month period, by a deduction from
25 the annuitant's monthly benefit.
26 (c) If the member fails to make the full contribution
27 under this Section in a timely fashion, the payments made
28 under this Section shall be refunded to the member, without
29 interest. If the member dies before making the full
30 contribution, the payments made under this Section shall be
31 refunded to the member's estate.
32 (d) For purposes of this Section and subsection (b) of
33 Section 17-116, optional creditable service established by a
34 member shall be deemed to have been earned at the time of the
35 employment or other qualifying event upon which the service
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1 is based, rather than at the time the credit was established
2 in this Fund.
3 (40 ILCS 5/17-127) (from Ch. 108 1/2, par. 17-127)
4 Sec. 17-127. Financing; revenues for the Fund.
5 (a) The revenues for the Fund shall consist of: (1)
6 amounts paid into the Fund by contributors thereto and from
7 taxes and State appropriations in accordance with this
8 Article; (2) amounts contributed to the Fund pursuant to any
9 law now in force or hereafter to be enacted; (3)
10 contributions from any other source; and (4) the earnings on
11 investments.
12 (b) The General Assembly finds that for many years the
13 State has contributed to the Fund an annual amount that is
14 between 20% and 30% of the amount of the annual State
15 contribution to the Article 16 retirement system, and the
16 General Assembly declares that it is its goal and intention
17 to continue this level of contribution to the Fund in the
18 future.
19 Beginning in State fiscal year 1999, the State shall
20 include in its annual contribution to the Fund an additional
21 amount equal to 0.544% of the Fund's total teacher payroll;
22 except that this additional contribution need not be made in
23 a fiscal year if the Board has certified in the previous
24 fiscal year that the Fund is at least 90% funded, based on
25 actuarial determinations. These additional State
26 contributions are intended to offset a portion of the cost to
27 the Fund of the increases in retirement benefits resulting
28 from this amendatory Act of 1997.
29 (Source: P.A. 88-593, eff. 8-22-94.)
30 (40 ILCS 5/17-127.2 new)
31 Sec. 17-127.2. Additional contributions by employer of
32 teachers.
33 (a) Beginning July 1, 1998, the employer of a teacher
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1 shall pay to the Fund an employer contribution computed as
2 follows:
3 (1) Beginning July 1, 1998 through June 30, 1999,
4 the employer contribution shall be equal to 0.3% of each
5 teacher's salary.
6 (2) Beginning July 1, 1999 through June 30, 2000,
7 the employer contribution shall be equal to 0.6% of each
8 teacher's salary.
9 (3) Beginning July 1, 2000 and thereafter, the
10 employer contribution shall be equal to 0.9% of each
11 teacher's salary.
12 The employer may pay these employer contributions out of any
13 source of funding available for that purpose and shall
14 forward the contributions to the Fund on the schedule
15 established for the payment of member contributions.
16 These employer contributions need not be made in a fiscal
17 year if the Board has certified in the previous fiscal year
18 that the Fund is at least 90% funded, based on actuarial
19 determinations.
20 These employer contributions are intended to offset a
21 portion of the cost to the Fund of the increases in
22 retirement benefits resulting from this amendatory Act of
23 1997.
24 (40 ILCS 5/17-129) (from Ch. 108 1/2, par. 17-129)
25 Sec. 17-129. Employer contributions; deficiency in Fund.
26 (a) If in any fiscal year of the board of education ending
27 prior to 1997 the total amounts paid to the Fund from the
28 board of education (other than under this subsection, and
29 other than amounts used for making or "picking up"
30 contributions on behalf of teachers) and from the State do
31 not equal the total contributions made by or on behalf of the
32 teachers for such year, or if the total income of the Fund in
33 any such fiscal year of the board of education from all
34 sources is less than the total such expenditures by the Fund
-39- SRS90SB0003MNgeccr1
1 for such year, the Board of Education shall, in the next
2 succeeding year, in addition to any other payment to the Fund
3 set apart and appropriate from moneys from its tax levy for
4 educational purposes, a sum sufficient to remove such
5 deficiency or deficiencies, and promptly pay such sum into
6 the Fund in order to restore any of the reserves of the Fund
7 that may have been so temporarily applied. Any amounts
8 received by the Fund after the effective date of this
9 amendatory Act of 1997 from State appropriations, including
10 under Section 17-127, shall be a credit against and shall
11 fully satisfy any obligation that may have arisen, or be
12 claimed to have arisen, under this paragraph (a) as a result
13 of any deficiency or deficiencies in the fiscal year of the
14 board of education ending in calendar year 1997.
15 (b) (i) For fiscal years 2011 through 2045, the minimum
16 contribution to the Fund to be made by the board of education
17 in each fiscal year shall be an amount determined by the Fund
18 to be sufficient to bring the total assets of the Fund up to
19 90% of the total actuarial liabilities of the Fund by the end
20 of fiscal year 2045. In making these determinations, the
21 required board of education contribution shall be calculated
22 each year as a level percentage of payroll over the years
23 remaining to and including fiscal year 2045 and shall be
24 determined under the projected unit credit actuarial cost
25 method.
26 (ii) For fiscal years 1999 through 2010, the board of
27 education's contribution to the Fund, as a percentage of the
28 applicable employee payroll, shall be increased in equal
29 annual increments so that by fiscal year 2011, the board of
30 education is contributing at the rate required under this
31 subsection.
32 (iii) Beginning in fiscal year 2046, the minimum board
33 of education contribution for each fiscal year shall be the
34 amount needed to maintain the total assets of the Fund at 90%
35 of the total actuarial liabilities of the Fund.
-40- SRS90SB0003MNgeccr1
1 (iv) Any contribution by the State to or for the benefit
2 of the Fund, including, without limitation, as referred to
3 under Section 17-127, shall be a credit against any
4 contribution required to be made by the board of education
5 under this subsection (b).
6 (c) The Board of Trustees shall determine the amount of
7 board of education contributions required for each fiscal
8 year on the basis of the actuarial tables and other
9 assumptions adopted by the Board and the recommendations of
10 the actuary, in order to meet the minimum contribution
11 requirements of subsections (a) and (b). Annually, on or
12 before November 15, the Board shall certify to the board of
13 education the amount of the required board of education
14 contribution for the coming fiscal year. The certification
15 shall include a copy of the actuarial recommendations upon
16 which it is based.
17 (Source: P.A. 89-15, eff. 5-30-95.)
18 (40 ILCS 5/17-130) (from Ch. 108 1/2, par. 17-130)
19 Sec. 17-130. Participants' contributions by payroll
20 deductions.
21 (a) There shall be deducted from the salary of each
22 teacher 7.35% 6 1/2% of his salary for service or disability
23 retirement pension and 0.5% 1/2 of 1% of salary for the
24 annual increase in base pension.
25 In addition, there shall be deducted from the salary of
26 each teacher 1% of his salary for survivors' and children's
27 pensions.
28 (b) The board is authorized to make the necessary
29 deductions from the salaries of its teachers, to receive any
30 other contributions required to be made by them, and to
31 certify to the city treasurer the amounts so deducted and
32 contributed by them. Such amounts shall be included as a
33 part of the fund. The board shall formulate such rules and
34 regulations as may be necessary to give effect to the
-41- SRS90SB0003MNgeccr1
1 provisions of this Section.
2 (c) All persons employed as teachers shall, by such
3 employment, accept the provisions of this Article and of
4 Sections 34-83 to 34-87, inclusive, of "The School Code",
5 approved March 18, 1961, as amended, and thereupon become
6 contributors to the fund in accordance with the terms
7 thereof. The provisions of this Article and of those
8 Sections shall become a part of the contract of employment.
9 (d) A person who (i) was a member before July 1, 1998,
10 (ii) retires with more than 34 years of creditable service,
11 and (iii) does not elect to qualify for the augmented rate
12 under Section 17-119.1 shall be entitled, at the time of
13 retirement, to receive a partial refund of contributions made
14 under this Section for service occurring after the later of
15 June 30, 1998 or attainment of 34 years of creditable
16 service, in an amount equal to 0.85% of the salary upon which
17 those contributions were based.
18 (Source: P.A. 81-1536.)
19 (40 ILCS 5/17-130.2 new)
20 Sec. 17-130.2. Pickup of optional contributions.
21 (a) For the purposes of this Section, "optional
22 contributions" means contributions that a member elects to
23 make in order to qualify for the augmented service retirement
24 pension rate under Section 17-119.1.
25 (b) Subject to the requirements of federal law and the
26 rules of the Board, beginning July 1, 1998 a member who is
27 employed on a full-time basis may elect to have the Employer
28 pick up optional contributions that the member has elected to
29 pay to the Fund, and the contributions so picked up shall be
30 treated as employer contributions for the purposes of
31 determining federal tax treatment. The election to have
32 optional contributions picked up is irrevocable. At the time
33 of making the election, the member shall execute a binding,
34 irrevocable payroll deduction authorization. Upon receiving
-42- SRS90SB0003MNgeccr1
1 notice of the election, the Employer shall pick up the
2 contributions by a reduction in the cash salary of the member
3 and shall pay the contributions from the same source of funds
4 that is used to pay earnings to the member.
5 (c) Each Employer under this Fund shall take the steps
6 necessary to comply with the requirements of Section 414(h)
7 of the Internal Revenue Code of 1986, as amended, to permit
8 the pickup of optional contributions on a tax-deferred basis.
9 Section 90. The State Mandates Act is amended by adding
10 Section 8.21 as follows:
11 (30 ILCS 805/8.21 new)
12 Sec. 8.21. Exempt mandate. Notwithstanding Sections 6
13 and 8 of this Act, no reimbursement by the State is required
14 for the implementation of any mandate created by this
15 amendatory Act of 1997.
16 Section 99. Effective date. This Act takes effect upon
17 becoming law.".
18 Submitted on , 1997.
19 ______________________________ _____________________________
20 Senator Madigan Representative Hannig
21 ______________________________ _____________________________
22 Senator Walsh, T. Representative Murphy
23 ______________________________ _____________________________
24 Senator Peterson Representative Erwin
25 ______________________________ _____________________________
26 Senator Jacobs Representative Churchill
27 ______________________________ _____________________________
28 Senator Molaro Representative Hoeft
29 Committee for the Senate Committee for the House