State of Illinois
92nd General Assembly
Legislation

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92_HB1858

 
                                               LRB9205424EGfg

 1        AN ACT in relation to public employee benefits.

 2        Be  it  enacted  by  the People of the State of Illinois,
 3    represented in the General Assembly:

 4        Section 5.  The  Illinois  Pension  Code  is  amended  by
 5    changing Sections 5-167.1 and 5-167.2 as follows:

 6        (40 ILCS 5/5-167.1) (from Ch. 108 1/2, par. 5-167.1)
 7        Sec.  5-167.1.  Automatic increase in annuity; retirement
 8    from service after September 1, 1967.
 9        (a)  A policeman who retires from service after September
10    1, 1967 with at least 20 years of service credit shall,  upon
11    either the first of the month following the first anniversary
12    of  his  date  of  retirement if he is age 60 (age 55 if born
13    before January 1, 1945) or over on that anniversary date,  or
14    upon  the  first of the month following his attainment of age
15    60 (age 55 if born before January 1, 1945) if it occurs after
16    the first anniversary of his retirement date, have  his  then
17    fixed  and  payable  monthly  annuity increased by 1 1/2% and
18    such first fixed annuity as granted at  retirement  increased
19    by an additional 1 1/2% in January of each year thereafter up
20    to  a maximum increase of 30%.  Beginning January 1, 1983 for
21    policemen born before January 1, 1930, and beginning  January
22    1,  1988  for  policemen born on or after January 1, 1930 but
23    before January 1, 1940, and beginning  January  1,  1996  for
24    policemen born on or after January 1, 1940 but before January
25    1,  1945, such increases shall be 3% and such policemen shall
26    not be subject to the 30% maximum increase.
27        Beginning January 1, 2002, regardless of the  policeman's
28    date  of  birth,  all  annual increases under this subsection
29    shall be at the rate of 3%  of  the  current  amount  of  the
30    annuity,  including any previous increases granted under this
31    Article, and the 30% maximum no longer applies.
 
                            -2-                LRB9205424EGfg
 1        Notwithstanding the other provisions of this  subsection,
 2    any policeman who qualifies for a minimum annuity and retires
 3    after  September  1,  1967  but  has not received the initial
 4    increase under this subsection  before  January  1,  2002  is
 5    entitled   to   receive   the  initial  increase  under  this
 6    subsection on (1) January 1, 2002, (2) the first  anniversary
 7    of  the  date  of  retirement,  or  (3) attainment of age 55,
 8    whichever occurs last.  The changes to this Section  made  by
 9    this  amendatory  Act  of  the  92nd  General  Assembly apply
10    without  regard  to  whether  the  policeman   or   annuitant
11    terminated   service   before  the  effective  date  of  this
12    amendatory Act.
13        Any policeman born before January 1, 1945  who  qualifies
14    for a minimum annuity and retires after September 1, 1967 but
15    has  not  received the initial increase under this subsection
16    before January 1, 1996 is entitled  to  receive  the  initial
17    increase  under  this  subsection on (1) January 1, 1996, (2)
18    the first anniversary of  the  date  of  retirement,  or  (3)
19    attainment  of age 55, whichever occurs last.  The changes to
20    this Section made  by  this  amendatory  Act  of  1995  apply
21    beginning  January  1, 1996 and without regard to whether the
22    policeman  or  annuitant  terminated   service   before   the
23    effective date of this amendatory Act of 1995.
24        (b)  Subsection  (a) of this Section is not applicable to
25    an employee receiving a term annuity.
26        (c)  To  help  defray  the  cost  of  such  increases  in
27    annuity, there shall  be  deducted,  beginning  September  1,
28    1967,  from  each payment of salary to a policeman, 1/2 of 1%
29    of each salary payment concurrently with and in  addition  to
30    the salary deductions otherwise made for annuity purposes.
31        The city, in addition to the contributions otherwise made
32    by  it  for  annuity  purposes under other provisions of this
33    Article, shall make matching contributions concurrently  with
34    such salary deductions.
 
                            -3-                LRB9205424EGfg
 1        Each  such  1/2 of 1% deduction from salary and each such
 2    contribution by the city of 1/2 of  1%  of  salary  shall  be
 3    credited  to  the  Automatic  Increase Reserve, to be used to
 4    defray the cost of the 1 1/2% annuity  increase  provided  by
 5    this  Section.   Any  balance  in  such  reserve  as  of  the
 6    beginning  of  each  calendar  year  shall  be  credited with
 7    interest at the rate of 3% per annum.
 8        Such deductions from salary and city contributions  shall
 9    continue while the policeman is in service.
10        The  salary  deductions  provided in this Section are not
11    subject to refund, except to the policeman  himself,  in  any
12    case  in  which  a policeman withdraws prior to qualification
13    for minimum annuity and applies for  refund  or  applies  for
14    annuity,  and  also  where a term annuity becomes payable. In
15    such cases, the total of  such  salary  deductions  shall  be
16    refunded  to  the policeman, without interest, and charged to
17    the Automatic Increase Reserve.
18    (Source: P.A. 89-12, eff. 4-20-95.)

19        (40 ILCS 5/5-167.2) (from Ch. 108 1/2, par. 5-167.2)
20        Sec. 5-167.2. Retirement before  September  1,  1967.   A
21    retired  policeman,  qualifying  for  minimum  annuity or who
22    retired from service with 20 or more years of service, before
23    September 1, 1967, shall, in January of  the  year  following
24    the  year he attains the age of 65, or in January of the year
25    1970, if then more than 65 years of age, have his then  fixed
26    and  payable  monthly annuity increased by an amount equal to
27    2% of the original  grant  of  annuity,  for  each  year  the
28    policeman  was  in receipt of annuity payments after the year
29    in which he attains,  or  did  attain  the  age  of  63.   An
30    additional  2%  increase  in  such  then  fixed  and  payable
31    original   granted  annuity  shall  accrue  in  each  January
32    thereafter.  Beginning January 1,  1986,  the  rate  of  such
33    increase  shall  be  3%  instead of 2%.  Beginning January 1,
 
                            -4-                LRB9205424EGfg
 1    2002, all annual increases under this paragraph shall  be  at
 2    the  rate  of  3%  of  the  current  amount  of  the annuity,
 3    including any previous increases granted under this  Article.
 4    The change made to this Section by this amendatory Act of the
 5    92nd General Assembly is not limited to persons in service on
 6    or after its effective date.
 7        The provisions of the preceding paragraph of this Section
 8    apply only to a retired policeman eligible for such increases
 9    in  his annuity who contributes to the Fund a sum equal to $5
10    for each full year of credited service upon which his annuity
11    was computed.  All such sums contributed shall be placed in a
12    Supplementary Payment Reserve  and  shall  be  used  for  the
13    purposes of such Fund account.
14        Beginning  with  the monthly annuity payment due in July,
15    1982, the fixed and granted monthly annuity payment  for  any
16    policeman  who  retired from the service, before September 1,
17    1976, at age 50 or over with 20 or more years of service  and
18    entitled  to an annuity on January 1, 1974, shall be not less
19    than $400.  It is the intent of the General Assembly that the
20    change made in this Section by this amendatory  Act  of  1982
21    shall apply retroactively to July 1, 1982.
22        Beginning with the monthly annuity payment due on January
23    1,  1986,  the  fixed and granted monthly annuity payment for
24    any policeman who retired from the service before January  1,
25    1986,  at age 50 or over with 20 or more years of service, or
26    any policeman who retired from service due to termination  of
27    disability  and  who  is entitled to an annuity on January 1,
28    1986, shall be not less than $475.
29        Beginning with the monthly annuity payment due on January
30    1, 1992, the fixed and granted monthly  annuity  payment  for
31    any  policeman who retired from the service before January 1,
32    1992, at age 50 or over with 20 or more years of service, and
33    for any policeman who retired from service due to termination
34    of disability and who is entitled to an annuity on January 1,
 
                            -5-                LRB9205424EGfg
 1    1992, shall be not less than $650.
 2        Beginning with the monthly annuity payment due on January
 3    1, 1993, the fixed and granted monthly  annuity  payment  for
 4    any  policeman who retired from the service before January 1,
 5    1993, at age 50 or over with 20 or more years of service, and
 6    for any policeman who retired from service due to termination
 7    of disability and who is entitled to an annuity on January 1,
 8    1993, shall be not less than $750.
 9        Beginning with the monthly annuity payment due on January
10    1, 1994, the fixed and granted monthly  annuity  payment  for
11    any  policeman who retired from the service before January 1,
12    1994, at age 50 or over with 20 or more years of service, and
13    for any policeman who retired from service due to termination
14    of disability and who is entitled to an annuity on January 1,
15    1994, shall be not less than $850.
16        The difference in amount between the original  fixed  and
17    granted  monthly annuity of any such policeman on the date of
18    his retirement from  the  service  and  the  monthly  annuity
19    provided  for in the immediately preceding paragraph shall be
20    paid  as  a  supplement  in  the  manner  set  forth  in  the
21    immediately following paragraph.
22        To defray the annual cost of the increases  indicated  in
23    the  preceding  part  of   this  Section, the annual interest
24    income accruing from investments held by this Fund, exclusive
25    of gains or losses on sales or exchanges of assets during the
26    year, over and above 4% a year shall be used  to  the  extent
27    necessary and available to finance the cost of such increases
28    for  the  following year and such amount shall be transferred
29    as of the end of each year beginning with the year 1969 to  a
30    Fund  account designated as the Supplementary Payment Reserve
31    from the Interest and Investment Reserve set forth in Section
32    5-207.
33        In the event  the  funds  in  the  Supplementary  Payment
34    Reserve  in  any  year  arising from: (1) the interest income
 
                            -6-                LRB9205424EGfg
 1    accruing in the preceding  year above 4% a year and  (2)  the
 2    contributions by retired persons are insufficient to make the
 3    total  payments  to  all  persons  entitled  to  the  annuity
 4    specified  in this Section and (3) any interest earnings over
 5    4% a year  beginning  with  the  year  1969  which  were  not
 6    previously  used  to  finance  such  increases and which were
 7    transferred to the Prior Service Annuity Reserve, may be used
 8    to the extent necessary and available to  provide  sufficient
 9    funds to finance such increases for the current year and such
10    sums  shall  be  transferred  from  the Prior Service Annuity
11    Reserve.  In the event  the  total  money  available  in  the
12    Supplementary   Payment   Reserve   from   such  sources  are
13    insufficient to  make  the  total  payments  to  all  persons
14    entitled  to  such  increases  for  the year, a proportionate
15    amount computed as the ratio of the money  available  to  the
16    total  of the total payments specified for that year shall be
17    paid to each person for that year.
18        The Fund shall  be  obligated  for  the  payment  of  the
19    increases in  annuity as provided for in this Section only to
20    the extent that the assets for such purpose are available.
21    (Source: P.A. 91-357, eff. 7-29-99.)

22        Section  90.  The State Mandates Act is amended by adding
23    Section 8.25 as follows:

24        (30 ILCS 805/8.25 new)
25        Sec. 8.25. Exempt mandate.   Notwithstanding  Sections  6
26    and  8 of this Act, no reimbursement by the State is required
27    for  the  implementation  of  any  mandate  created  by  this
28    amendatory Act of the 92nd General Assembly.

29        Section 99. Effective date.  This Act takes  effect  upon
30    becoming law.

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