State of Illinois
91st General Assembly
Legislation

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[ Senate Amendment 001 ]

91_HB1583sam002

 










                                           LRB9101658EGfgam02

 1                    AMENDMENT TO HOUSE BILL 1583

 2        AMENDMENT NO.     .  Amend House Bill 1583,  AS  AMENDED,
 3    by inserting after the end of Section 15 the following:

 4        "Section  20.   The  Illinois  Pension Code is amended by
 5    changing Sections 15-136, 15-136.2, and 15-185 as follows:

 6        (40 ILCS 5/15-136) (from Ch. 108 1/2, par. 15-136)
 7        Sec.  15-136.   Retirement  annuities  -   Amount.    The
 8    provisions  of  this  Section  15-136  apply  only  to  those
 9    participants who are participating in the traditional benefit
10    package  or  the portable benefit package and do not apply to
11    participants who are participating in the self-managed plan.
12        (a)  The amount of a  participant's  retirement  annuity,
13    expressed  in  the  form  of  a single-life annuity, shall be
14    determined by whichever of the following rules is  applicable
15    and provides the largest annuity:
16        Rule  1:  The  retirement annuity shall be 1.67% of final
17    rate of earnings for each of the first 10 years  of  service,
18    1.90%  for  each  of  the next 10 years of service, 2.10% for
19    each year of service in excess of 20 but  not  exceeding  30,
20    and  2.30%  for each year in excess of 30; or for persons who
21    retire on or after January 1, 1998, 2.2% of the final rate of
22    earnings for each year of service.
 
                            -2-            LRB9101658EGfgam02
 1        Rule 2:  The retirement annuity shall be the sum  of  the
 2    following,   determined   from   amounts   credited   to  the
 3    participant in accordance with the actuarial tables  and  the
 4    prescribed  rate  of  interest  in  effect  at  the  time the
 5    retirement annuity begins:
 6             (i)  the normal annuity which can be provided on  an
 7        actuarially  equivalent  basis, by the accumulated normal
 8        contributions as of the date the annuity begins; and
 9             (ii)  an annuity from employer contributions  of  an
10        amount  equal  to  that  which  can  be  provided  on  an
11        actuarially  equivalent basis from the accumulated normal
12        contributions  made  by  the  participant  under  Section
13        15-113.6 and Section 15-113.7 plus 1.4  times  all  other
14        accumulated normal contributions made by the participant.
15        With  respect  to  a  police  officer  or firefighter who
16    retires on or after August 14, the  effective  date  of  this
17    amendatory  Act of 1998, the accumulated normal contributions
18    taken into account under clauses (i) and (ii) of this Rule  2
19    shall include the additional normal contributions made by the
20    police officer or firefighter under Section 15-157(a).
21        The  amount of a retirement annuity calculated under this
22    Rule  2  shall  be  computed  solely  on  the  basis  of  the
23    participant's accumulated normal contributions, as  specified
24    in  this  Rule  and  defined  in  Section 15-116.  Neither an
25    employee or employer contribution for early retirement  under
26    Section 15-136.2 nor any other employer contribution shall be
27    used in the calculation of the amount of a retirement annuity
28    under this Rule 2.
29        This  amendatory  Act  of  the 91st General Assembly is a
30    clarification  of  existing  law   and   applies   to   every
31    participant and annuitant without regard to whether status as
32    an  employee  terminates  before  the  effective date of this
33    amendatory Act.
34        Rule 3:  The retirement annuity of a participant  who  is
 
                            -3-            LRB9101658EGfgam02
 1    employed  at  least  one-half time during the period on which
 2    his or her final rate of earnings is based, shall be equal to
 3    the  participant's  years  of  service  not  to  exceed   30,
 4    multiplied  by  (1)  $96  if  the participant's final rate of
 5    earnings is less than $3,500, (2) $108 if the final  rate  of
 6    earnings is at least $3,500 but less than $4,500, (3) $120 if
 7    the  final  rate of earnings is at least $4,500 but less than
 8    $5,500, (4) $132 if the final rate of earnings  is  at  least
 9    $5,500  but  less  than $6,500, (5) $144 if the final rate of
10    earnings is at least $6,500 but less than $7,500, (6) $156 if
11    the final rate of earnings is at least $7,500 but  less  than
12    $8,500,  (7)  $168  if the final rate of earnings is at least
13    $8,500 but less than $9,500, and (8) $180 if the  final  rate
14    of  earnings  is  $9,500 or more, except that the annuity for
15    those  persons  having  made  an   election   under   Section
16    15-154(a-1)   shall  be  calculated  and  payable  under  the
17    portable  retirement  benefit   program   pursuant   to   the
18    provisions of Section 15-136.4.
19        Rule  4:  A participant who is at least age 50 and has 25
20    or more years of service as a police officer or  firefighter,
21    and  a  participant who is age 55 or over and has at least 20
22    but less than 25 years of service  as  a  police  officer  or
23    firefighter,  shall  be  entitled  to a retirement annuity of
24    2 1/4% of the final rate of earnings for each of the first 10
25    years of service as a police officer or  firefighter,  2 1/2%
26    for  each of the next 10 years of service as a police officer
27    or firefighter, and 2 3/4% for each  year  of  service  as  a
28    police   officer   or  firefighter  in  excess  of  20.   The
29    retirement annuity for all other service  shall  be  computed
30    under Rule 1.
31        For purposes of this Rule 4, a participant's service as a
32    firefighter shall also include the following:
33             (i)  service  that  is performed while the person is
34        an employee under subsection (h) of Section 15-107; and
 
                            -4-            LRB9101658EGfgam02
 1             (ii)  in  the  case  of  an  individual  who  was  a
 2        participating employee employed in the fire department of
 3        the  University  of  Illinois's  Champaign-Urbana  campus
 4        immediately  prior  to  the  elimination  of  that   fire
 5        department  and  who immediately after the elimination of
 6        that fire department transferred to another job with  the
 7        University  of Illinois, service performed as an employee
 8        of the University of Illinois in a  position  other  than
 9        police  officer  or  firefighter,  from  the date of that
10        transfer until the employee's next termination of service
11        with the University of Illinois.
12        (b)  The retirement annuity provided under Rules 1 and  3
13    above  shall  be  reduced  by  1/2  of  1% for each month the
14    participant is under  age  60  at  the  time  of  retirement.
15    However,  this  reduction  shall  not  apply in the following
16    cases:
17             (1)  For a  disabled  participant  whose  disability
18        benefits  have  been  discontinued  because he or she has
19        exhausted  eligibility  for  disability  benefits   under
20        clause (6) of Section 15-152;
21             (2)  For  a  participant who has at least the number
22        of years of service required to retire at any  age  under
23        subsection (a) of Section 15-135; or
24             (3)  For  that portion of a retirement annuity which
25        has  been  provided  on  account  of   service   of   the
26        participant  during  periods when he or she performed the
27        duties of a  police  officer  or  firefighter,  if  these
28        duties  were  performed  for at least 5 years immediately
29        preceding the date the retirement annuity is to begin.
30        (c)  The maximum retirement annuity provided under  Rules
31    1,  2,  and  4 shall be the lesser of (1) the annual limit of
32    benefits as specified in Section 415 of the Internal  Revenue
33    Code  of  1986,  as  such Section may be amended from time to
34    time and as such benefit limits  shall  be  adjusted  by  the
 
                            -5-            LRB9101658EGfgam02
 1    Commissioner  of  Internal Revenue, and (2) 80% of final rate
 2    of earnings.
 3        (d)  An annuitant whose status as an employee  terminates
 4    after  August  14,  1969 shall receive automatic increases in
 5    his or her retirement annuity as follows:
 6        Effective January 1 immediately following  the  date  the
 7    retirement  annuity  begins,  the  annuitant shall receive an
 8    increase in his or her monthly retirement annuity  of  0.125%
 9    of the monthly retirement annuity provided under Rule 1, Rule
10    2,  Rule  3, or Rule 4, contained in this Section, multiplied
11    by the number of full months which elapsed from the date  the
12    retirement  annuity  payments  began to January 1, 1972, plus
13    0.1667% of such annuity, multiplied by  the  number  of  full
14    months  which  elapsed  from January 1, 1972, or the date the
15    retirement annuity payments began,  whichever  is  later,  to
16    January 1, 1978, plus 0.25% of such annuity multiplied by the
17    number  of full months which elapsed from January 1, 1978, or
18    the date the retirement annuity payments began, whichever  is
19    later, to the effective date of the increase.
20        The  annuitant  shall  receive  an increase in his or her
21    monthly retirement  annuity  on  each  January  1  thereafter
22    during  the  annuitant's  life  of  3% of the monthly annuity
23    provided under Rule 1, Rule 2, Rule 3, or Rule 4 contained in
24    this Section.  The change made under this subsection by  P.A.
25    81-970  is  effective  January  1,  1980  and applies to each
26    annuitant whose status as an employee  terminates  before  or
27    after that date.
28        Beginning January 1, 1990, all automatic annual increases
29    payable   under   this  Section  shall  be  calculated  as  a
30    percentage of the total annuity payable at the  time  of  the
31    increase,  including  all  increases previously granted under
32    this Article.
33        The change made in this subsection  by  P.A.  85-1008  is
34    effective  January 26, 1988, and is applicable without regard
 
                            -6-            LRB9101658EGfgam02
 1    to whether status as an employee terminated before that date.
 2        (e)  If, on January 1, 1987, or the date  the  retirement
 3    annuity payment period begins, whichever is later, the sum of
 4    the  retirement  annuity  provided  under Rule 1 or Rule 2 of
 5    this Section and  the  automatic  annual  increases  provided
 6    under  the  preceding subsection or Section 15-136.1, amounts
 7    to less than the retirement annuity which would  be  provided
 8    by  Rule  3,  the retirement annuity shall be increased as of
 9    January 1, 1987, or the date the retirement  annuity  payment
10    period  begins, whichever is later, to the amount which would
11    be provided by Rule 3 of this Section. Such increased  amount
12    shall  be considered as the retirement annuity in determining
13    benefits provided under other Sections of this Article.  This
14    paragraph  applies  without  regard  to  whether status as an
15    employee  terminated  before  the  effective  date  of   this
16    amendatory  Act  of  1987,  provided  that  the annuitant was
17    employed at least one-half time during the  period  on  which
18    the final rate of earnings was based.
19        (f)  A participant is entitled to such additional annuity
20    as may be provided on an actuarially equivalent basis, by any
21    accumulated  additional  contributions  to his or her credit.
22    However, the additional contributions made by the participant
23    toward the automatic increases in annuity provided under this
24    Section shall not be taken into account  in  determining  the
25    amount of such additional annuity.
26        (g)  If,  (1)  by law, a function of a governmental unit,
27    as defined by Section 20-107 of this Code, is transferred  in
28    whole  or  in  part  to  an  employer,  and (2) a participant
29    transfers employment from  such  governmental  unit  to  such
30    employer  within 6 months after the transfer of the function,
31    and (3) the sum of (A) the annuity payable to the participant
32    under Rule 1, 2, or 3 of this Section  (B)  all  proportional
33    annuities  payable to the participant by all other retirement
34    systems covered by Article 20, and (C)  the  initial  primary
 
                            -7-            LRB9101658EGfgam02
 1    insurance  amount  to which the participant is entitled under
 2    the Social Security Act, is less than the retirement  annuity
 3    which  would  have  been  payable if all of the participant's
 4    pension credits  validated  under  Section  20-109  had  been
 5    validated  under this system, a supplemental annuity equal to
 6    the difference in  such  amounts  shall  be  payable  to  the
 7    participant.
 8        (h)  On January 1, 1981, an annuitant who was receiving a
 9    retirement  annuity  on  or before January 1, 1971 shall have
10    his or her retirement annuity then being  paid  increased  $1
11    per  month for each year of creditable service. On January 1,
12    1982, an annuitant  whose  retirement  annuity  began  on  or
13    before  January  1,  1977,  shall  have his or her retirement
14    annuity then being paid increased $1 per month for each  year
15    of creditable service.
16        (i)  On  January  1, 1987, any annuitant whose retirement
17    annuity began on or before January 1, 1977,  shall  have  the
18    monthly retirement annuity increased by an amount equal to 8¢
19    per year of creditable service times the number of years that
20    have elapsed since the annuity began.
21    (Source: P.A. 90-14, eff. 7-1-97; 90-65, eff. 7-7-97; 90-448,
22    eff.  8-16-97;  90-576,  eff.  3-31-98; 90-655, eff. 7-30-98;
23    90-766, eff. 8-14-98.)

24        (40 ILCS 5/15-136.2) (from Ch. 108 1/2, par. 15-136.2)
25        Sec. 15-136.2.  Early  retirement  without  discount.   A
26    participant  whose  retirement  annuity  begins after June 1,
27    1981 and on or before September 1, 2002 and within six months
28    of  the  last  day  of  employment   for   which   retirement
29    contributions  were  required,  may  elect  at  the  time  of
30    application  to  make a one time employee contribution to the
31    System and thereby avoid the early  retirement  reduction  in
32    retirement  annuity specified under subsection (b) of Section
33    15-136.  The exercise of the election shall obligate the last
 
                            -8-            LRB9101658EGfgam02
 1    employer to also make a one time non-refundable  contribution
 2    to the System.
 3        The one time employee and employer contributions shall be
 4    a  percentage of the retiring participant's highest full time
 5    annual salary rate  during  the  academic  years  which  were
 6    considered  in determining his or her final rate of earnings,
 7    or if not full time  then  the  full  time  equivalent.   The
 8    employee  contribution  rate  shall  be  7% multiplied by the
 9    lesser of the following 2 sums: (1) the number of years  that
10    the  participant  is  less  than age 60; or (2) the number of
11    years that the participant's creditable service is less  than
12    35  years.  The employer contribution shall be at the rate of
13    20% for each year the participant is less than age  60.   The
14    employer  shall  pay  the employer contribution from the same
15    source  of  funds  which  is  used  in  paying  earnings   to
16    employees.
17        Upon  receipt of the application and election, the System
18    shall  determine  the  one   time   employee   and   employer
19    contributions.   The  provisions of this Section shall not be
20    applicable until all the above  outlined  contributions  have
21    been   received   by  the  System;  however,  the  date  such
22    contributions  are  received  shall  not  be  considered   in
23    determining the effective date of retirement.
24        Employee  and  employer  contributions under this Section
25    shall be used only  to  eliminate  the  reduction  for  early
26    retirement  under  Rules  1 and 3 of Section 15-136 and shall
27    not be used in calculating annuities under Rules 2 or  4  set
28    forth  in  Section  15-136.   This amendatory Act of the 91st
29    General Assembly is  a  clarification  of  existing  law  and
30    applies  to every participant and annuitant without regard to
31    whether status as an employee terminates before the effective
32    date of this amendatory Act.
33        For persons who apply to the Board  after  the  effective
34    date  of this amendatory Act of 1993 and before July 1, 1993,
 
                            -9-            LRB9101658EGfgam02
 1    requesting a retirement annuity to begin no earlier than July
 2    1, 1993 and no later than June 30, 1994, the  employer  shall
 3    pay  both  the  employee  and employer contributions required
 4    under this Section.
 5        The number of employees retiring under  this  Section  in
 6    any  fiscal year may be limited at the option of the employer
 7    to no less than 15% of those eligible.  The  right  to  elect
 8    early  retirement  without  discount shall be allocated among
 9    those applying on the basis of seniority in  the  service  of
10    the last employer.
11    (Source: P.A. 90-65, eff. 7-7-97; 90-511, eff. 8-22-97.)

12        (40 ILCS 5/15-185) (from Ch. 108 1/2, par. 15-185)
13        Sec.  15-185.   Annuities, etc., exempt.  The accumulated
14    employee and employer contributions shall be  held  in  trust
15    for  each  participant and annuitant, and this trust shall be
16    treated as a spendthrift trust.  Except as provided  in  this
17    Article,  all  cash,  securities  and  other property of this
18    system, all annuities and other benefits payable  under  this
19    Article  and  all  accumulated  credits  of  participants and
20    annuitants in this system and the  right  of  any  person  to
21    receive  an annuity or other benefit under this Article, or a
22    refund of contributions, shall not be  subject  to  judgment,
23    execution,  garnishment,  attachment,  or  other  seizure  by
24    process,  in  bankruptcy  or  otherwise, nor to sale, pledge,
25    mortgage or other alienation, and shall  not  be  assignable.
26    The board, however, may deduct from the benefits, refunds and
27    credits payable to the participant, annuitant or beneficiary,
28    amounts  owed  by the participant or annuitant to the system.
29    No attempted sale, transfer or  assignment  of  any  benefit,
30    refund or credit shall prevent the right of the board to make
31    the  deduction  and  offset  authorized in this Section.  Any
32    participant or annuitant may authorize the  board  to  deduct
33    from disability benefits or annuities, premiums due under any
 
                            -10-           LRB9101658EGfgam02
 1    group  hospital-surgical insurance program which is sponsored
 2    or approved by any employer;  however,  the  deductions  from
 3    disability benefits may not begin prior to 6 months after the
 4    disability occurs.
 5        A  person  receiving  an  annuity  or  benefit under this
 6    Article  may also authorize withholding from that annuity  or
 7    benefit for the purposes enumerated in and in accordance with
 8    the  provisions  of  the State Salary and Annuity Withholding
 9    Act.
10        This Section is not intended to, and does not, affect the
11    calculation of any benefit under this Article or dictate  how
12    or  to  what extent employee or employer contributions are to
13    be  taken  into  account  in   calculating   benefits.   This
14    amendatory   Act   of   the   91st   General  Assembly  is  a
15    clarification  of  existing  law   and   applies   to   every
16    participant and annuitant without regard to whether status as
17    an  employee  terminates  before  the  effective date of this
18    amendatory Act.
19        Public Act 86-273 is a clarification of existing law  and
20    shall  be  applicable  to  every  participant  and  annuitant
21    without  regard  to  whether status as an employee terminates
22    before the effective date of that Act.
23    (Source: P.A.  90-65,  eff.  7-7-97;  90-448,  eff.  8-16-97;
24    90-511, eff. 8-22-97; 90-655, eff. 7-30-98.)

25        Section  25.   The  Illinois  Pension  Code is amended by
26    changing Section 15-136, 15-139, 15-146, 15-146.1, and 15-154
27    as follows:

28        (40 ILCS 5/15-136) (from Ch. 108 1/2, par. 15-136)
29        Sec.  15-136.   Retirement  annuities  -   Amount.    The
30    provisions  of  this  Section  15-136  apply  only  to  those
31    participants who are participating in the traditional benefit
32    package  or  the portable benefit package and do not apply to
 
                            -11-           LRB9101658EGfgam02
 1    participants who are participating in the self-managed plan.
 2        (a)  The amount of a  participant's  retirement  annuity,
 3    expressed  in  the  form  of  a single-life annuity, shall be
 4    determined by whichever of the following rules is  applicable
 5    and provides the largest annuity:
 6        Rule  1:  The  retirement annuity shall be 1.67% of final
 7    rate of earnings for each of the first 10 years  of  service,
 8    1.90%  for  each  of  the next 10 years of service, 2.10% for
 9    each year of service in excess of 20 but  not  exceeding  30,
10    and  2.30%  for each year in excess of 30; or for persons who
11    retire on or after January 1, 1998, 2.2% of the final rate of
12    earnings for each year of service.
13        Rule 2:  The retirement annuity shall be the sum  of  the
14    following,   determined   from   amounts   credited   to  the
15    participant in accordance with the actuarial tables  and  the
16    prescribed  rate  of  interest  in  effect  at  the  time the
17    retirement annuity begins:
18             (i)  the normal annuity which can be provided on  an
19        actuarially  equivalent  basis, by the accumulated normal
20        contributions as of the date the annuity begins; and
21             (ii)  an annuity from employer contributions  of  an
22        amount which can be provided on an actuarially equivalent
23        basis  from  the accumulated normal contributions made by
24        the  participant  under  Section  15-113.6  and   Section
25        15-113.7  plus  1.4  times  all  other accumulated normal
26        contributions made by the participant.
27    With respect to a police officer or firefighter  who  retires
28    on  or  after  the  effective  date of this amendatory Act of
29    1998, the accumulated normal contributions taken into account
30    under clauses (i) and (ii) of this Rule 2 shall  include  the
31    additional normal contributions made by the police officer or
32    firefighter under Section 15-157(a).
33        Rule  3:  The  retirement annuity of a participant who is
34    employed at least one-half time during the  period  on  which
 
                            -12-           LRB9101658EGfgam02
 1    his or her final rate of earnings is based, shall be equal to
 2    the   participant's  years  of  service  not  to  exceed  30,
 3    multiplied by (1) $96 if  the  participant's  final  rate  of
 4    earnings  is  less than $3,500, (2) $108 if the final rate of
 5    earnings is at least $3,500 but less than $4,500, (3) $120 if
 6    the final rate of earnings is at least $4,500 but  less  than
 7    $5,500,  (4)  $132  if the final rate of earnings is at least
 8    $5,500 but less than $6,500, (5) $144 if the  final  rate  of
 9    earnings is at least $6,500 but less than $7,500, (6) $156 if
10    the  final  rate of earnings is at least $7,500 but less than
11    $8,500, (7) $168 if the final rate of earnings  is  at  least
12    $8,500  but  less than $9,500, and (8) $180 if the final rate
13    of earnings is $9,500 or more, except that  the  annuity  for
14    those   persons   having   made  an  election  under  Section
15    15-154(a-1)  shall  be  calculated  and  payable  under   the
16    portable   retirement   benefit   program   pursuant  to  the
17    provisions of Section 15-136.4.
18        Rule 4:  A participant who is at least age 50 and has  25
19    or  more years of service as a police officer or firefighter,
20    and a participant who is age 55 or over and has at  least  20
21    but  less  than  25  years  of service as a police officer or
22    firefighter, shall be entitled to  a  retirement  annuity  of
23    2 1/4% of the final rate of earnings for each of the first 10
24    years  of  service as a police officer or firefighter, 2 1/2%
25    for each of the next 10 years of service as a police  officer
26    or  firefighter,  and  2 3/4%  for  each year of service as a
27    police  officer  or  firefighter  in  excess  of   20.    The
28    retirement  annuity  for  all other service shall be computed
29    under Rule 1.
30        For purposes of this Rule 4, a participant's service as a
31    firefighter shall also include the following:
32             (i)  service that is performed while the  person  is
33        an employee under subsection (h) of Section 15-107; and
34             (ii)  in  the  case  of  an  individual  who  was  a
 
                            -13-           LRB9101658EGfgam02
 1        participating employee employed in the fire department of
 2        the  University  of  Illinois's  Champaign-Urbana  campus
 3        immediately   prior  to  the  elimination  of  that  fire
 4        department and who immediately after the  elimination  of
 5        that  fire department transferred to another job with the
 6        University of Illinois, service performed as an  employee
 7        of  the  University  of Illinois in a position other than
 8        police officer or firefighter,  from  the  date  of  that
 9        transfer until the employee's next termination of service
10        with the University of Illinois.
11        Rule  5:  The  retirement  annuity  of  a participant who
12    elected early retirement  under  the  provisions  of  Section
13    15-136.2  and  who,  on  or  before February 16 1995, brought
14    administrative proceedings  pursuant  to  the  administrative
15    rules  adopted  by the System to challenge the calculation of
16    his or her  retirement  annuity  shall  be  the  sum  of  the
17    following,   determined   from   amounts   credited   to  the
18    participant in accordance with the actuarial tables  and  the
19    prescribed  rate  of  interest  in  effect  at  the  time the
20    retirement annuity begins:
21             (i)  the normal annuity which can be provided on  an
22        actuarially  equivalent  basis, by the accumulated normal
23        contributions as of the date the annuity begins; and
24             (ii)  an annuity from employer contributions  of  an
25        amount  equal  to  that  which  can  be  provided  on  an
26        actuarially  equivalent basis from the accumulated normal
27        contributions  made  by  the  participant  under  Section
28        15-113.6 and Section 15-113.7 plus 1.4  times  all  other
29        accumulated normal contributions made by the participant;
30        and
31             (iii)  an  annuity  which  can  be  provided  on  an
32        actuarially    equivalent   basis   from   the   employee
33        contribution for early retirement under Section 15-136.2,
34        and an annuity from employer contributions of  an  amount
 
                            -14-           LRB9101658EGfgam02
 1        equal  to  that  which  can be provided on an actuarially
 2        equivalent basis from the employee contribution for early
 3        retirement under Section 15-136.2.
 4        In no event shall a retirement annuity under this Rule  5
 5    be  lower  than the amount obtained by adding (1) the monthly
 6    amount  obtained  by  dividing  the  combined  employee   and
 7    employer  contributions  made  under  Section 15-136.2 by the
 8    System's annuity factor for the age of the participant at the
 9    beginning of the annuity payment period and  (2)  the  amount
10    equal  to  the participant's annuity if calculated under Rule
11    1, reduced under Section 15-136(b) as if no contributions had
12    been made under Section 15-136.2.
13        With respect to a participant  who  is  qualified  for  a
14    retirement annuity under this Rule 5 whose retirement annuity
15    began before the effective date of this amendatory Act of the
16    91st  General Assembly, and for whom an employee contribution
17    was made under Section 15-136.2, the System shall recalculate
18    the retirement annuity under this Rule 5 and  shall  pay  any
19    additional  amounts  due  in  the  manner provided in Section
20    15-186.1 for benefits mistakenly set too low.
21        The amount of a retirement annuity calculated under  this
22    Rule  5  shall  be  computed  solely  on  the  basis of those
23    contributions specifically set forth in this Rule 5.   Except
24    as  provided  in  clause  (iii)  of  this  Rule 5, neither an
25    employee nor employer contribution for early retirement under
26    Section 15-136.2, nor any other employer contribution,  shall
27    be  used  in  the  calculation  of the amount of a retirement
28    annuity under this Rule 5.
29        The General Assembly has adopted the changes set forth in
30    Section 25  of  this  amendatory  Act  of  the  91st  General
31    Assembly  in  recognition  that the decision of the Appellate
32    Court for the Fourth District in Mattis v. State Universities
33    Retirement System et al. might be deemed to give  some  right
34    to  the  plaintiff in that case.  The changes made by Section
 
                            -15-           LRB9101658EGfgam02
 1    25 of this amendatory Act of the 91st General Assembly are  a
 2    legislative  implementation  of the decision of the Appellate
 3    Court for the Fourth District in Mattis v. State Universities
 4    Retirement System et al. with respect to that plaintiff.
 5        The changes made by Section 25 of this amendatory Act  of
 6    the 91st General Assembly apply without regard to whether the
 7    person is in service as an employee on or after its effective
 8    date.
 9        (b)  The  retirement annuity provided under Rules 1 and 3
10    above shall be reduced by  1/2  of  1%  for  each  month  the
11    participant  is  under  age  60  at  the  time of retirement.
12    However, this reduction shall  not  apply  in  the  following
13    cases:
14             (1)  For  a  disabled  participant  whose disability
15        benefits have been discontinued because  he  or  she  has
16        exhausted   eligibility  for  disability  benefits  under
17        clause (6) of Section 15-152;
18             (2)  For a participant who has at least  the  number
19        of  years  of service required to retire at any age under
20        subsection (a) of Section 15-135; or
21             (3)  For that portion of a retirement annuity  which
22        has   been   provided   on  account  of  service  of  the
23        participant during periods when he or she  performed  the
24        duties  of  a  police  officer  or  firefighter, if these
25        duties were performed for at least  5  years  immediately
26        preceding the date the retirement annuity is to begin.
27        (c)  The  maximum retirement annuity provided under Rules
28    1, 2, and 4, and 5 shall be the  lesser  of  (1)  the  annual
29    limit of benefits as specified in Section 415 of the Internal
30    Revenue  Code  of  1986,  as such Section may be amended from
31    time to time and as such benefit limits shall be adjusted  by
32    the  Commissioner  of  Internal Revenue, and (2) 80% of final
33    rate of earnings.
34        (d)  An annuitant whose status as an employee  terminates
 
                            -16-           LRB9101658EGfgam02
 1    after  August  14,  1969 shall receive automatic increases in
 2    his or her retirement annuity as follows:
 3        Effective January 1 immediately following  the  date  the
 4    retirement  annuity  begins,  the  annuitant shall receive an
 5    increase in his or her monthly retirement annuity  of  0.125%
 6    of the monthly retirement annuity provided under Rule 1, Rule
 7    2,  Rule  3, or Rule 4, or Rule 5, contained in this Section,
 8    multiplied by the number of full months  which  elapsed  from
 9    the  date the retirement annuity payments began to January 1,
10    1972, plus 0.1667% of such annuity, multiplied by the  number
11    of  full  months  which  elapsed from January 1, 1972, or the
12    date the retirement  annuity  payments  began,  whichever  is
13    later,  to  January  1,  1978,  plus  0.25%  of  such annuity
14    multiplied by the number of full months  which  elapsed  from
15    January  1, 1978, or the date the retirement annuity payments
16    began, whichever is later,  to  the  effective  date  of  the
17    increase.
18        The  annuitant  shall  receive  an increase in his or her
19    monthly retirement  annuity  on  each  January  1  thereafter
20    during  the  annuitant's  life  of  3% of the monthly annuity
21    provided under Rule 1, Rule 2, Rule 3, or Rule 4, or  Rule  5
22    contained  in  this  Section.   The  change  made  under this
23    subsection by P.A. 81-970 is effective January  1,  1980  and
24    applies  to  each  annuitant  whose  status  as  an  employee
25    terminates before or after that date.
26        Beginning January 1, 1990, all automatic annual increases
27    payable   under   this  Section  shall  be  calculated  as  a
28    percentage of the total annuity payable at the  time  of  the
29    increase,  including  all  increases previously granted under
30    this Article.
31        The change made in this subsection  by  P.A.  85-1008  is
32    effective  January 26, 1988, and is applicable without regard
33    to whether status as an employee terminated before that date.
34        (e)  If, on January 1, 1987, or the date  the  retirement
 
                            -17-           LRB9101658EGfgam02
 1    annuity payment period begins, whichever is later, the sum of
 2    the  retirement  annuity  provided  under Rule 1 or Rule 2 of
 3    this Section and  the  automatic  annual  increases  provided
 4    under  the  preceding subsection or Section 15-136.1, amounts
 5    to less than the retirement annuity which would  be  provided
 6    by  Rule  3,  the retirement annuity shall be increased as of
 7    January 1, 1987, or the date the retirement  annuity  payment
 8    period  begins, whichever is later, to the amount which would
 9    be provided by Rule 3 of this Section. Such increased  amount
10    shall  be considered as the retirement annuity in determining
11    benefits provided under other Sections of this Article.  This
12    paragraph  applies  without  regard  to  whether status as an
13    employee  terminated  before  the  effective  date  of   this
14    amendatory  Act  of  1987,  provided  that  the annuitant was
15    employed at least one-half time during the  period  on  which
16    the final rate of earnings was based.
17        (f)  A participant is entitled to such additional annuity
18    as may be provided on an actuarially equivalent basis, by any
19    accumulated  additional  contributions  to his or her credit.
20    However, the additional contributions made by the participant
21    toward the automatic increases in annuity provided under this
22    Section shall not be taken into account  in  determining  the
23    amount of such additional annuity.
24        (g)  If,  (1)  by law, a function of a governmental unit,
25    as defined by Section 20-107 of this Code, is transferred  in
26    whole  or  in  part  to  an  employer,  and (2) a participant
27    transfers employment from  such  governmental  unit  to  such
28    employer  within 6 months after the transfer of the function,
29    and (3) the sum of (A) the annuity payable to the participant
30    under Rule 1, 2, or 3 of this Section  (B)  all  proportional
31    annuities  payable to the participant by all other retirement
32    systems covered by Article 20, and (C)  the  initial  primary
33    insurance  amount  to which the participant is entitled under
34    the Social Security Act, is less than the retirement  annuity
 
                            -18-           LRB9101658EGfgam02
 1    which  would  have  been  payable if all of the participant's
 2    pension credits  validated  under  Section  20-109  had  been
 3    validated  under this system, a supplemental annuity equal to
 4    the difference in  such  amounts  shall  be  payable  to  the
 5    participant.
 6        (h)  On January 1, 1981, an annuitant who was receiving a
 7    retirement  annuity  on  or before January 1, 1971 shall have
 8    his or her retirement annuity then being  paid  increased  $1
 9    per  month for each year of creditable service. On January 1,
10    1982, an annuitant  whose  retirement  annuity  began  on  or
11    before  January  1,  1977,  shall  have his or her retirement
12    annuity then being paid increased $1 per month for each  year
13    of creditable service.
14        (i)  On  January  1, 1987, any annuitant whose retirement
15    annuity began on or before January 1, 1977,  shall  have  the
16    monthly retirement annuity increased by an amount equal to 8¢
17    per year of creditable service times the number of years that
18    have elapsed since the annuity began.
19    (Source: P.A. 90-14, eff. 7-1-97; 90-65, eff. 7-7-97; 90-448,
20    eff.  8-16-97;  90-576,  eff.  3-31-98; 90-655, eff. 7-30-98;
21    90-766, eff. 8-14-98.)

22        (40 ILCS 5/15-139) (from Ch. 108 1/2, par. 15-139)
23        Sec.   15-139.    Retirement   annuities;   Cancellation;
24    Suspended during employment.
25        (a)  If  an  annuitant  returns  to  employment  for   an
26    employer within 60 days after the beginning of the retirement
27    annuity  payment  period,  the  retirement  annuity  shall be
28    cancelled, and the annuitant shall refund to the  System  the
29    total  amount  of the retirement annuity payments which he or
30    she received. If the retirement  annuity  is  cancelled,  the
31    participant shall continue to participate in the System.
32        (b)  If an annuitant retires prior to age 60 and receives
33    or  becomes entitled to receive during any month compensation
 
                            -19-           LRB9101658EGfgam02
 1    in excess of the  monthly  retirement  annuity  for  services
 2    performed after the date of retirement for any employer under
 3    this  System,  the  State  Employees'  Retirement  System  of
 4    Illinois,  or the Teachers' Retirement System of the State of
 5    Illinois, that portion  of  the  monthly  retirement  annuity
 6    provided by employer contributions shall not be payable.
 7        If an annuitant retires at age 60 or over and receives or
 8    becomes   entitled   to  receive  during  any  academic  year
 9    compensation in excess of the difference between his  or  her
10    highest  annual  earnings  prior to retirement and his or her
11    annual retirement annuity computed under Rule 1, Rule 2, Rule
12    3, or Rule 4, or  Rule  5  of  Section  15-136  for  services
13    performed after the date of retirement for any employer under
14    this  System,  that portion of the monthly retirement annuity
15    provided by employer contributions shall  be  reduced  by  an
16    amount   equal   to   the   compensation  that  exceeds  such
17    difference.
18        However, any  remuneration  received  for  serving  as  a
19    member  of  the  Illinois  Educational  Labor Relations Board
20    shall be excluded from "compensation"  for  the  purposes  of
21    this  subsection (b), and serving as a member of the Illinois
22    Educational Labor Relations Board shall not be deemed to be a
23    return to employment for the purposes of this  Section.  This
24    provision  applies  without  regard  to  whether  service was
25    terminated prior to the effective date of this amendatory Act
26    of 1991.
27        (c)  If an employer certifies that an annuitant has  been
28    reemployed  on  a  permanent  and  continuous  basis  or in a
29    position in which the annuitant is expected to serve  for  at
30    least  9 months, the annuitant shall resume his or her status
31    as a participating employee and  shall  be  entitled  to  all
32    rights applicable to participating employees upon filing with
33    the  board  an election to forego all annuity payments during
34    the period of reemployment. Upon subsequent  retirement,  the
 
                            -20-           LRB9101658EGfgam02
 1    retirement  annuity  shall  consist  of the annuity which was
 2    terminated  by  the   reemployment,   plus   the   additional
 3    retirement  annuity  based  upon  service  granted during the
 4    period of reemployment, but the combined  retirement  annuity
 5    shall  not  exceed the maximum annuity applicable on the date
 6    of the last retirement.
 7        The total service and earnings credited before and  after
 8    the  initial  date  of  retirement  shall  be  considered  in
 9    determining  eligibility  of  the  employee or the employee's
10    beneficiary  to  benefits  under   this   Article,   and   in
11    calculating final rate of earnings.
12        In determining the death benefit payable to a beneficiary
13    of  an  annuitant  who again becomes a participating employee
14    under  this  Section,  accumulated  normal   and   additional
15    contributions   shall   be  considered  as  the  sum  of  the
16    accumulated normal and additional contributions at  the  date
17    of   initial   retirement  and  the  accumulated  normal  and
18    additional contributions credited after that date,  less  the
19    sum of the annuity payments received by the annuitant.
20        The  survivors  insurance benefits provided under Section
21    15-145 shall not be applicable to an  annuitant  who  resumes
22    his  or  her  status  as a participating employee, unless the
23    annuitant, at the time of initial retirement, has a survivors
24    insurance beneficiary who could qualify for such benefits.
25        If the annuitant's employment is  terminated  because  of
26    circumstances  other than death before 9 months from the date
27    of reemployment, the provisions  of  this  Section  regarding
28    resumption  of  status  as a participating employee shall not
29    apply. The normal and survivors insurance contributions which
30    are deducted during this period  shall  be  refunded  to  the
31    annuitant  without  interest,  and  subsequent benefits under
32    this Article shall be the same as those which were applicable
33    prior to the date the annuitant resumed employment.
34    (Source: P.A. 86-1488.)
 
                            -21-           LRB9101658EGfgam02
 1        (40 ILCS 5/15-146) (from Ch. 108 1/2, par. 15-146)
 2        Sec. 15-146.   Survivors  insurance  benefits  -  Minimum
 3    amounts.
 4        (a)  The  minimum  total  survivors  annuity  payable  on
 5    account  of  the  death  of a participant shall be 50% of the
 6    retirement annuity which would have been provided under  Rule
 7    1,  Rule  2,  or Rule 3, or Rule 5 of Section 15-136 upon the
 8    participant's attainment of the  minimum  age  at  which  the
 9    penalty  for  early retirement would not be applicable or the
10    date of the participant's death, whichever is later,  on  the
11    basis of credits earned prior to the time of death.
12        (b)  The  minimum  total  survivors  annuity  payable  on
13    account  of  the  death  of  an annuitant shall be 50% of the
14    retirement annuity which is payable under Section  15-136  at
15    the time of death or 50% of the disability retirement annuity
16    payable   under  Section  15-153.2.  This  minimum  survivors
17    annuity shall apply to each  participant  and  annuitant  who
18    dies  after  September  16,  1979,  whether or not his or her
19    employee status terminates before or after that date.
20        (c)  If an annuitant has elected a reversionary  annuity,
21    the  retirement  annuity  referred to in this Section is that
22    which would have been payable  had  such  election  not  been
23    filed.
24    (Source: P.A. 90-448, eff. 8-16-97; 90-766, eff. 8-14-98.)

25        (40 ILCS 5/15-146.1) (from Ch. 108 1/2, par. 15-146.1)
26        Sec.   15-146.1.   Survivors  insurance  benefits-Maximum
27    amounts.  (a) The maximum total survivors annuity payable  on
28    account  of  any deceased participating employee shall be the
29    lesser of:  (1) 80% of the final rate of earnings; or (2) (A)
30    $400 per month if  one  survivors  insurance  beneficiary  is
31    entitled  to  a  survivors  annuity, or (B) $600 per month if
32    there are 2 or more such beneficiaries.
33        (b)  The  maximum  total  survivors  annuity  payable  on
 
                            -22-           LRB9101658EGfgam02
 1    account of the death of any person occurring after retirement
 2    or after termination of his or her employee status  shall  be
 3    the  lesser  of:   (1) 80% of the final rate of earnings; (2)
 4    (A) $400 per month if one survivors insurance beneficiary  is
 5    entitled  to  a  survivors  annuity, or (B) $600 per month if
 6    there are 2 or more such beneficiaries; or  (3)  80%  of  the
 7    retirement  annuity  payable  to the annuitant at the date of
 8    retirement under the provisions of Rule 1, Rule 2, or Rule 3,
 9    or Rule 5 of Section 15-136, or 80% of the retirement annuity
10    which  would  have  been  payable  to  the  participant  upon
11    attainment of the minimum age at which the penalty for  early
12    retirement  would  not  be  applicable  or the date of death,
13    whichever is later, based upon credits earned as of the  date
14    of death.
15        (c)  The  maximum  total  survivors  annuity  payable  on
16    account  of  the death of any person whose death occurs while
17    in receipt of a disability retirement annuity  under  Section
18    15-153.2  shall  be the lesser of (1) 80% of his or her final
19    rate of earnings, (2) (A) $400 per  month  if  one  survivors
20    insurance  beneficiary is entitled to a survivors annuity, or
21    (B)  $600  per  month  if  2  or  more  survivors   insurance
22    beneficiaries  qualify  for  this  benefit, or (3) 80% of the
23    retirement  annuity  which  would  have  been  payable   upon
24    attainment  of  the  age  at  which  the  penalty  for  early
25    retirement  would  not  be  applicable  or the date of death,
26    whichever is later, based upon the participant's  credits  on
27    the  date  of  death,  or  80%  of  the disability retirement
28    annuity whichever is greater.
29        (d)  If the minimum annuity provided under Section 15-146
30    exceeds the maximum annuity provided under this Section,  the
31    minimum annuity shall be payable.
32        (e)  If  an annuitant has elected a reversionary annuity,
33    the retirement annuity referred to in this  Section  is  that
34    which  would  have  been  payable  had such election not been
 
                            -23-           LRB9101658EGfgam02
 1    filed.
 2        (f)  If a survivors insurance beneficiary qualifies for a
 3    survivors or  widows   annuity  because  of  pension  credits
 4    established by the participant or annuitant in another system
 5    covered  by  Article 20, and the combined survivors annuities
 6    exceed the highest survivors annuity which could be  provided
 7    by either system based upon the combined pension credits, the
 8    survivors  annuity payable by this system shall be reduced to
 9    that amount  which,  when  added  to  the  survivors  annuity
10    payable  by  the  other  system,  would  equal  this  highest
11    survivors  annuity.   If  the  other  system  has  a  similar
12    provision  for  adjustment  of  the  survivors  annuity,  the
13    respective  proportional survivors annuities shall be reduced
14    proportionately according to the ratio which  the  amount  of
15    each proportional survivors annuity bears to the aggregate of
16    all proportional survivors annuities.  If a survivors annuity
17    is  payable  by another system covered by Article 20, and the
18    survivor elects to waive the survivors annuity and  accept  a
19    lump  sum  payment  or death benefit in lieu of the survivors
20    annuity, this system shall, for the purpose of adjusting  the
21    survivors  annuity  under  this  subsection,  assume that the
22    survivor was  entitled  to  a  survivors  annuity  which,  in
23    accordance  with  actuarial  tables  of  this  system, is the
24    actuarial equivalent of the amount of the lump sum payment or
25    death benefit.
26        (g)  The total monthly survivors annuity payable  to  the
27    beneficiaries  of  any  annuitant  who  terminated employment
28    before July 14, 1959 and whose death occurs  after  September
29    16, 1977 shall not exceed $200.
30        (h)  Whenever  a  reduction  in  the survivors annuity is
31    made as authorized  above,  the  survivors  annuity  to  each
32    dependent   parent   shall   be  proportionately  reduced  or
33    eliminated,  and  if  further  reduction  is  necessary,  the
34    survivors annuity payable to  every  other  person  shall  be
 
                            -24-           LRB9101658EGfgam02
 1    proportionately decreased.
 2    (Source: P.A. 86-272.)

 3        (40 ILCS 5/15-154) (from Ch. 108 1/2, par. 15-154)
 4        Sec. 15-154.  Refunds.
 5        (a)  A   participant  whose  status  as  an  employee  is
 6    terminated, regardless of cause, or who has been on  lay  off
 7    status  for  more  than  120 days, and who is not on leave of
 8    absence, is  entitled  to  a  refund  of  contributions  upon
 9    application;  except  that  not  more  than  one  such refund
10    application may be made during any academic year.
11        Except as set forth in subsections (a-1) and  (a-2),  the
12    refund shall be the sum of the accumulated normal, additional
13    and  survivors  insurance  contributions,  less the amount of
14    interest credited on these contributions each year in  excess
15    of 4 1/2% of the amount on which interest was calculated.
16        (a-1)  A  person  who  elects,  in  accordance  with  the
17    requirements  of  Section  15-134.5,  to  participate  in the
18    portable benefit package  and  who  becomes  a  participating
19    employee under that retirement program upon the conclusion of
20    the  one-year  waiting  period  applicable  to  the  portable
21    benefit  package  election  shall  have  his  or  her  refund
22    calculated  in  accordance  with the provisions of subsection
23    (a-2).
24        (a-2)  The refund payable to a participant  described  in
25    subsection  (a-1)  shall  be  the  sum  of  the participant's
26    accumulated normal and additional contributions,  as  defined
27    in Sections 15-116 and 15-117.  If the participant terminates
28    with  5 or more years of service for employment as defined in
29    Section 15-113.1, he or she  shall  also  be  entitled  to  a
30    distribution  of employer contributions in an amount equal to
31    the  sum   of   the   accumulated   normal   and   additional
32    contributions, as defined in Sections 15-116 and 15-117.
33        (b)  Upon   acceptance   of  a  refund,  the  participant
 
                            -25-           LRB9101658EGfgam02
 1    forfeits all accrued rights and credits in the System, and if
 2    subsequently reemployed, the participant shall be  considered
 3    a  new  employee subject to all the qualifying conditions for
 4    participation and eligibility for benefits applicable to  new
 5    employees.  If  such  person  again  becomes  a participating
 6    employee and continues as such for 2 years, or is employed by
 7    an employer and participates for at  least  2  years  in  the
 8    Federal  Civil  Service  Retirement  System, all such rights,
 9    credits, and  previous  status  as  a  participant  shall  be
10    restored upon repayment of the amount of the refund, together
11    with  compound  interest thereon from the date the refund was
12    received to the date of repayment at the rate of 6% per annum
13    through August 31, 1982, and at  the  effective  rates  after
14    that date.
15        (c)  If  a  participant  covered  under  the transitional
16    benefit package has made survivors  insurance  contributions,
17    but  has  no survivors insurance beneficiary upon retirement,
18    he or she shall be entitled to a refund  of  the  accumulated
19    survivors   insurance  contributions,  or  to  an  additional
20    annuity the value  of  which  is  equal  to  the  accumulated
21    survivors insurance contributions.
22        (d)  A  participant,  upon  application, is entitled to a
23    refund of his or  her  accumulated  additional  contributions
24    attributable to the additional contributions described in the
25    last  sentence  of subsection (c) of Section 15-157. Upon the
26    acceptance  of  such  a  refund  of  accumulated   additional
27    contributions,   the  participant  forfeits  all  rights  and
28    credits which may have accrued because of such contributions.
29        (e)  A participant who terminates  his  or  her  employee
30    status  and  elects  to  waive  service  credit under Section
31    15-154.2, is entitled to a refund of the accumulated  normal,
32    additional  and  survivors  insurance  contributions, if any,
33    which were credited the participant for this service,  or  to
34    an  additional  annuity  the  value  of which is equal to the
 
                            -26-           LRB9101658EGfgam02
 1    accumulated  normal,  additional  and   survivors   insurance
 2    contributions,  if  any;  except  that not more than one such
 3    refund application may be made during any academic year. Upon
 4    acceptance of  this  refund,  the  participant  forfeits  all
 5    rights and credits accrued because of this service.
 6        (f)  If  a  police  officer  or  firefighter  receives  a
 7    retirement annuity under Rule 1 or 3 of Section 15-136, he or
 8    she  shall  be  entitled  at  retirement  to  a refund of the
 9    difference   between   his   or   her   accumulated    normal
10    contributions  and  the normal contributions which would have
11    accumulated had such person filed a waiver of the  retirement
12    formula provided by Rule 4 of Section 15-136.
13        (g)  If,  at  the time of retirement, a participant would
14    be entitled to a retirement annuity under Rule 1, 2, 3, or 4,
15    or 5 of Section 15-136 that exceeds the maximum specified  in
16    clause  (1)  of  subsection  (c) of Section 15-136, he or she
17    shall be entitled to a refund of the employee  contributions,
18    if  any,  paid under Section 15-157 after the date upon which
19    continuance of such contributions would have otherwise caused
20    the retirement annuity to exceed this maximum, plus  compound
21    interest at the effective rates.
22    (Source: P.A.  90-448,  eff.  8-16-97;  90-576, eff. 3-31-98;
23    90-766, eff. 8-14-98.)

24        Section 90. Severability.
25        (a)  It is the intent of the General  Assembly  that  the
26    changes made by Section 25 of this amendatory Act of the 91st
27    General  Assembly  are  not  severable  from one another, and
28    should any of the changes made  by  Section  25  be  declared
29    invalid, then the remainder of those changes shall not remain
30    in effect.
31        (b)  Except   as   set   forth  in  subsection  (a),  the
32    provisions  of  this  amendatory  Act  of  the  91st  General
33    Assembly are severable under Section 1.31 of the  Statute  on
 
                            -27-           LRB9101658EGfgam02
 1    Statutes.   Without  limiting the foregoing, it is the intent
 2    of the General Assembly that should the provisions of Section
 3    25 of this amendatory Act of the  91st  General  Assembly  be
 4    declared invalid, then the remainder of this Act shall remain
 5    in effect.".

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