Public Act 90-0065 of the 90th General Assembly

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Public Act 90-0065

HB0110 Enrolled                                LRB9000902EGfg

    AN ACT in relation to public  employees,  amending  named
Acts.

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

    Section 5.  The State Employees Group  Insurance  Act  of
1971 is amended by changing Sections 3 and 10 as follows:

    (5 ILCS 375/3) (from Ch. 127, par. 523)
    (Text of Section before amendment by P.A. 89-507)
    Sec.   3.  Definitions.   Unless  the  context  otherwise
requires, the following words and phrases as used in this Act
shall have the following meanings.  The Department may define
these and other words and phrases separately for the  purpose
of  implementing  specific  programs providing benefits under
this Act.
    (a)  "Administrative  service  organization"  means   any
person,  firm  or  corporation experienced in the handling of
claims  which  is  fully  qualified,  financially  sound  and
capable of meeting the service requirements of a contract  of
administration executed with the Department.
    (b)  "Annuitant"  means  (1)  an employee who retires, or
has retired, on or after January  1,  1966  on  an  immediate
annuity under the provisions of Articles 2, 14, 15 (including
an  employee  who  has  retired and is receiving a retirement
annuity under an optional program established  under  Section
15-158.2  and  who  would  also  be eligible for a retirement
annuity had that person  been  a  participant  in  the  State
University  Retirement  System),  paragraphs  (b)  or  (c) of
Section 16-106, or Article 18 of the Illinois  Pension  Code;
(2)  any  person  who  was receiving group insurance coverage
under this Act as of March 31, 1978 by reason of  his  status
as an annuitant, even though the annuity in relation to which
such coverage was provided is a proportional annuity based on
less  than  the  minimum  period  of  service  required for a
retirement annuity in the system involved; (3) any person not
otherwise  covered  by  this  Act  who  has  retired   as   a
participating  member under Article 2 of the Illinois Pension
Code but is  ineligible  for  the  retirement  annuity  under
Section 2-119 of the Illinois Pension Code; (4) the spouse of
any  person  who  is  receiving  a  retirement  annuity under
Article 18 of the Illinois Pension Code and  who  is  covered
under  a  group  health  insurance  program  sponsored  by  a
governmental  employer  other  than the State of Illinois and
who has irrevocably elected to  waive  his  or  her  coverage
under  this  Act  and to have his or her spouse considered as
the "annuitant" under this Act and not as a  "dependent";  or
(5) an employee who retires, or has retired, from a qualified
position, as determined according to rules promulgated by the
Director,  under  a qualified local government or a qualified
rehabilitation facility  or  a  qualified  domestic  violence
shelter  or  service.  (For definition of "retired employee",
see (p) post).
    (b-5)  "New SERS annuitant" means a  person  who,  on  or
after  January  1,  1998, becomes an annuitant, as defined in
subsection  (b),  by  virtue  of  beginning  to   receive   a
retirement  annuity  under Article 14 of the Illinois Pension
Code, and is eligible to participate in the basic program  of
group health benefits provided for annuitants under this Act.
    (b-6)  "New  SURS  annuitant"  means  a person who, on or
after January 1, 1998, becomes an annuitant,  as  defined  in
subsection   (b),   by  virtue  of  beginning  to  receive  a
retirement annuity under Article 15 of the  Illinois  Pension
Code,  and is eligible to participate in the basic program of
group health benefits provided for annuitants under this Act.
    (c)  "Carrier"  means  (1)  an   insurance   company,   a
corporation   organized  under  the  Limited  Health  Service
Organization Act or the Voluntary Health Services Plan Act, a
partnership, or other nongovernmental organization, which  is
authorized  to  do  group  life  or  group  health  insurance
business  in  Illinois,  or  (2)  the  State of Illinois as a
self-insurer.
    (d)  "Compensation" means salary or wages  payable  on  a
regular  payroll  by  the State Treasurer on a warrant of the
State Comptroller out of any State, trust or federal fund, or
by the Governor of the State through a disbursing officer  of
the  State  out of a trust or out of federal funds, or by any
Department out of State, trust, federal or other  funds  held
by  the  State Treasurer or the Department, to any person for
personal  services  currently  performed,  and  ordinary   or
accidental  disability  benefits  under  Articles  2,  14, 15
(including ordinary or accidental disability  benefits  under
an  optional  program  established  under  Section 15-158.2),
paragraphs (b) or (c) of Section 16-106, or Article 18 of the
Illinois Pension Code, for disability incurred after  January
1,  1966, or benefits payable under the Workers' Compensation
or Occupational Diseases Act or benefits payable under a sick
pay plan established in accordance with  Section  36  of  the
State  Finance Act. "Compensation" also means salary or wages
paid to an employee of  any  qualified  local  government  or
qualified  rehabilitation  facility  or  a qualified domestic
violence shelter or service.
    (e)  "Commission"  means  the   State   Employees   Group
Insurance   Advisory   Commission  authorized  by  this  Act.
Commencing July 1, 1984, "Commission" as  used  in  this  Act
means   the   Illinois  Economic  and  Fiscal  Commission  as
established by the Legislative Commission Reorganization  Act
of 1984.
    (f)  "Contributory",  when  referred  to  as contributory
coverage, shall mean optional coverages or  benefits  elected
by  the  member  toward  the  cost of which such member makes
contribution, or which are funded in whole or in part through
the acceptance of a reduction in earnings or the foregoing of
an increase in earnings by an employee, as distinguished from
noncontributory coverage or benefits which are paid  entirely
by  the  State  of Illinois without reduction of the member's
salary.
    (g)  "Department"  means  any  department,   institution,
board,  commission, officer, court or any agency of the State
government  receiving  appropriations  and  having  power  to
certify payrolls to the Comptroller authorizing  payments  of
salary  and  wages against such appropriations as are made by
the General Assembly from any State fund,  or  against  trust
funds  held  by  the  State  Treasurer and includes boards of
trustees of the retirement systems created by Articles 2, 14,
15, 16 and 18 of the  Illinois  Pension  Code.   "Department"
also  includes  the  Illinois  Comprehensive Health Insurance
Board and the Illinois Rural Bond Bank.
    (h)  "Dependent", when the term is used in the context of
the health and life plan, means a  member's  spouse  and  any
unmarried child (1) from birth to age 19 including an adopted
child, a child who lives with the member from the time of the
filing  of a petition for adoption until entry of an order of
adoption, a stepchild or recognized child who lives with  the
member  in  a parent-child relationship, or a child who lives
with the member if such member is a court appointed  guardian
of  the  child,  or  (2) age 19 to 23 enrolled as a full-time
student in any accredited school, financially dependent  upon
the  member,  and  eligible as a dependent for Illinois State
income tax purposes, or (3) age 19 or over who is mentally or
physically handicapped as defined in the  Illinois  Insurance
Code.  For  the  health  plan only, the term "dependent" also
includes any person enrolled prior to the effective  date  of
this  Section  who is dependent upon the member to the extent
that the member may claim such  person  as  a  dependent  for
Illinois  State  income tax deduction purposes; no other such
person may be enrolled.
    (i)  "Director"  means  the  Director  of  the   Illinois
Department of Central Management Services.
    (j)  "Eligibility  period"  means  the  period  of time a
member has to elect  enrollment  in  programs  or  to  select
benefits without regard to age, sex or health.
    (k)  "Employee"   means  and  includes  each  officer  or
employee in the service of a department who (1) receives  his
compensation  for  service  rendered  to  the department on a
warrant  issued  pursuant  to  a  payroll  certified   by   a
department  or  on  a  warrant or check issued and drawn by a
department upon a trust,  federal  or  other  fund  or  on  a
warrant  issued pursuant to a payroll certified by an elected
or duly appointed  officer  of  the  State  or  who  receives
payment  of the performance of personal services on a warrant
issued pursuant to a payroll certified by  a  Department  and
drawn  by  the  Comptroller  upon the State Treasurer against
appropriations made by the General Assembly from any fund  or
against  trust  funds held by the State Treasurer, and (2) is
employed  full-time  or  part-time  in  a  position  normally
requiring actual performance of duty during not less than 1/2
of a normal work period, as established by  the  Director  in
cooperation with each department, except that persons elected
by  popular  vote  will  be  considered  employees during the
entire term for which they are elected  regardless  of  hours
devoted  to  the  service  of  the State, and (3) except that
"employee" does not include any person who is not eligible by
reason of such person's employment to participate in  one  of
the State retirement systems under Articles 2, 14, 15 (either
the   regular  Article  15  system  or  an  optional  program
established under Section 15-158.2) or 18, or under paragraph
(b) or (c) of Section 16-106, of the Illinois  Pension  Code,
but  such  term  does include persons who are employed during
the 6  month  qualifying  period  under  Article  14  of  the
Illinois  Pension  Code.   Such term also includes any person
who (1) after January  1,  1966,  is  receiving  ordinary  or
accidental  disability  benefits  under  Articles  2,  14, 15
(including ordinary or accidental disability  benefits  under
an  optional  program  established  under  Section 15-158.2),
paragraphs (b) or (c) of Section 16-106, or Article 18 of the
Illinois Pension Code, for disability incurred after  January
1,  1966,  (2)  receives  total  permanent or total temporary
disability   under   the   Workers'   Compensation   Act   or
Occupational Disease Act as a result of injuries sustained or
illness contracted in the course of employment with the State
of Illinois, or (3) is not otherwise covered under  this  Act
and  has retired as a participating member under Article 2 of
the  Illinois  Pension  Code  but  is  ineligible   for   the
retirement  annuity  under  Section  2-119  of  the  Illinois
Pension  Code.   However, a person who satisfies the criteria
of the foregoing definition of "employee"  except  that  such
person  is  made  ineligible  to  participate  in  the  State
Universities  Retirement  System  by clause (4) of subsection
(a) the first paragraph of Section  15-107  of  the  Illinois
Pension  Code  is also an "employee" for the purposes of this
Act.   "Employee"  also  includes  any  person  receiving  or
eligible for benefits under a sick pay  plan  established  in
accordance   with  Section  36  of  the  State  Finance  Act.
"Employee" also includes each  officer  or  employee  in  the
service  of  a  qualified local government, including persons
appointed as trustees of  sanitary  districts  regardless  of
hours  devoted  to  the service of the sanitary district, and
each employee in the service of  a  qualified  rehabilitation
facility  and  each  full-time  employee  in the service of a
qualified domestic violence shelter or service, as determined
according to rules promulgated by the Director.
    (l)  "Member"  means  an  employee,  annuitant,   retired
employee or survivor.
    (m)  "Optional   coverages   or   benefits"  means  those
coverages or benefits available to the member on his  or  her
voluntary election, and at his or her own expense.
    (n)  "Program"  means  the  group  life insurance, health
benefits and other employee benefits designed and  contracted
for by the Director under this Act.
    (o)  "Health  plan" means a self-insured health insurance
program offered by the State of Illinois for the purposes  of
benefiting  employees  by  means  of providing, among others,
wellness programs, utilization reviews, second  opinions  and
medical  fee  reviews, as well as for paying for hospital and
medical care up to the maximum coverage provided by the plan,
to its members and their dependents.
    (p)  "Retired employee" means any person who would be  an
annuitant  as  that  term  is defined herein but for the fact
that such person retired prior to January 1, 1966.  Such term
also includes any person formerly employed by the  University
of Illinois in the Cooperative Extension Service who would be
an  annuitant  but  for  the  fact  that such person was made
ineligible  to  participate   in   the   State   Universities
Retirement  System  by clause (4) of subsection (a) the first
paragraph of Section 15-107 of the Illinois Pension Code.
    (p-6)  "New SURS retired employee" means a person who, on
or after January 1, 1998,  becomes  a  retired  employee,  as
defined  in  subsection  (p),  by  virtue  of  being a person
formerly employed  by  the  University  of  Illinois  in  the
Cooperative  Extension  Service who would be an annuitant but
for  the  fact  that  he  or  she  was  made  ineligible   to
participate  in  the  State Universities Retirement System by
clause (4)  of  subsection  (a)  of  Section  15-107  of  the
Illinois  Pension Code, and who is eligible to participate in
the basic program  of  group  health  benefits  provided  for
retired employees under this Act.
    (q)  "Survivor"  means a person receiving an annuity as a
survivor of an employee or of an annuitant.  "Survivor"  also
includes:  (1)  the  surviving  dependent  of  a  person  who
satisfies  the  definition  of  "employee"  except  that such
person  is  made  ineligible  to  participate  in  the  State
Universities Retirement System by clause  (4)  of  subsection
(a)  the  first  paragraph  of Section 15-107 of the Illinois
Pension Code; and (2) the surviving dependent of  any  person
formerly  employed  by  the  University  of  Illinois  in the
Cooperative Extension  Service  who  would  be  an  annuitant
except  for  the fact that such person was made ineligible to
participate in the State Universities  Retirement  System  by
clause  (4)  of subsection (a) the first paragraph of Section
15-107 of the Illinois Pension Code.
    (q-5)  "New SERS survivor" means a survivor,  as  defined
in  subsection (q), whose annuity is paid under Article 14 of
the Illinois Pension Code and is based on the death of (i) an
employee whose death occurs on or after January 1,  1998,  or
(ii) a new SERS annuitant as defined in subsection (b-5).
    (q-6)  "New  SURS  survivor" means a survivor, as defined
in subsection (q), whose annuity is paid under Article 15  of
the Illinois Pension Code and is based on the death of (i) an
employee whose death occurs on or after January 1, 1998, (ii)
a new SURS annuitant as defined in subsection (b-6), or (iii)
a new SURS retired employee as defined in subsection (p-6).
    (r)  "Medical   services"  means  the  services  provided
within the scope of their licenses by  practitioners  in  all
categories licensed under the Medical Practice Act of 1987.
    (s)  "Unit   of   local  government"  means  any  county,
municipality, township, school district, special district  or
other  unit, designated as a unit of local government by law,
which exercises limited  governmental  powers  or  powers  in
respect  to limited governmental subjects, any not-for-profit
association  with  a  membership  that   primarily   includes
townships  and  township  officials,  that  has  duties  that
include  provision  of  research  service,  dissemination  of
information,  and  other  acts  for  the purpose of improving
township government, and that is funded wholly or  partly  in
accordance  with  Section  85-15  of  the  Township Code; any
not-for-profit corporation or association, with a  membership
consisting primarily of municipalities, that operates its own
utility    system,    and    provides   research,   training,
dissemination  of  information,  or  other  acts  to  promote
cooperation between and  among  municipalities  that  provide
utility  services  and  for  the advancement of the goals and
purposes of its membership; and the Illinois  Association  of
Park Districts.  "Qualified local government" means a unit of
local  government  approved by the Director and participating
in a program created under subsection (i) of  Section  10  of
this Act.
    (t)  "Qualified   rehabilitation   facility"   means  any
not-for-profit  organization  that  is  accredited   by   the
Commission  on  Accreditation of Rehabilitation Facilities or
certified  by  the  Department     of   Mental   Health   and
Developmental  Disabilities  to  provide  services to persons
with disabilities and which receives funds from the State  of
Illinois  for  providing  those  services,  approved  by  the
Director   and  participating  in  a  program  created  under
subsection (j) of Section 10 of this Act.
    (u)  "Qualified domestic  violence  shelter  or  service"
means  any  Illinois domestic violence shelter or service and
its administrative offices funded by the Illinois  Department
of  Public Aid, approved by the Director and participating in
a program created under subsection (k) of Section 10.
    (v)  "TRS benefit recipient" means a person who:
         (1)  is not a "member" as defined in  this  Section;
    and
         (2)  is  receiving  a  monthly benefit or retirement
    annuity under Article 16 of the  Illinois  Pension  Code;
    and
         (3)  either  (i)  has at least 8 years of creditable
    service under Article 16 of the Illinois Pension Code, or
    (ii) was enrolled in the health insurance program offered
    under that Article on January 1, 1996, or  (iii)  is  the
    survivor  of a benefit recipient who had at least 8 years
    of creditable service under Article 16  of  the  Illinois
    Pension  Code  or  was  enrolled  in the health insurance
    program offered under that Article on the effective  date
    of this amendatory Act of 1995, or (iv) is a recipient or
    survivor  of  a  recipient  of a disability benefit under
    Article 16 of the Illinois Pension Code.
    (w)  "TRS dependent beneficiary" means a person who:
         (1)  is not a "member" or "dependent" as defined  in
    this Section; and
         (2)  is  a  TRS benefit recipient's: (A) spouse, (B)
    dependent parent who is receiving at least half of his or
    her support  from  the  TRS  benefit  recipient,  or  (C)
    unmarried  natural  or adopted child who is (i) under age
    19, or  (ii)  enrolled  as  a  full-time  student  in  an
    accredited  school,  financially  dependent  upon the TRS
    benefit recipient, eligible as a dependent  for  Illinois
    State  income tax purposes, and either is under age 24 or
    was, on January 1, 1996,  participating  as  a  dependent
    beneficiary in the health insurance program offered under
    Article  16 of the Illinois Pension Code, or (iii) age 19
    or over who is  mentally  or  physically  handicapped  as
    defined in the Illinois Insurance Code.
    (x)  "Military  leave  with  pay  and benefits" refers to
individuals in basic training for reserves,  special/advanced
training,  annual  training, emergency call up, or activation
by the President of the United States with approved  pay  and
benefits.
    (y)  "Military  leave without pay and benefits" refers to
individuals who enlist for active duty in a regular component
of the U.S. Armed Forces  or  other  duty  not  specified  or
authorized under military leave with pay and benefits.
(Source:  P.A.  88-670,  eff.  12-2-94;  89-21, eff. 6-21-95;
89-25,  eff.  6-21-95;  89-76,  eff.  7-1-95;  89-324,   eff.
8-13-95;  89-430, eff. 12-15-95; 89-502, eff. 7-1-96; 89-628,
eff. 8-9-96; revised 8-23-96.)

    (Text of Section after amendment by P.A. 89-507)
    Sec.  3.  Definitions.   Unless  the  context   otherwise
requires, the following words and phrases as used in this Act
shall have the following meanings.  The Department may define
these  and other words and phrases separately for the purpose
of implementing specific programs  providing  benefits  under
this Act.
    (a)  "Administrative   service  organization"  means  any
person, firm or corporation experienced in  the  handling  of
claims  which  is  fully  qualified,  financially  sound  and
capable  of meeting the service requirements of a contract of
administration executed with the Department.
    (b)  "Annuitant" means (1) an employee  who  retires,  or
has  retired,  on  or  after  January 1, 1966 on an immediate
annuity under the provisions of Articles 2, 14, 15 (including
an employee who has retired and  is  receiving  a  retirement
annuity  under  an optional program established under Section
15-158.2 and who would also  be  eligible  for  a  retirement
annuity  had  that  person  been  a  participant in the State
University Retirement  System),  paragraphs  (b)  or  (c)  of
Section  16-106,  or Article 18 of the Illinois Pension Code;
(2) any person who was  receiving  group  insurance  coverage
under  this  Act as of March 31, 1978 by reason of his status
as an annuitant, even though the annuity in relation to which
such coverage was provided is a proportional annuity based on
less than the  minimum  period  of  service  required  for  a
retirement annuity in the system involved; (3) any person not
otherwise   covered   by  this  Act  who  has  retired  as  a
participating member under Article 2 of the Illinois  Pension
Code  but  is  ineligible  for  the  retirement annuity under
Section 2-119 of the Illinois Pension Code; (4) the spouse of
any person  who  is  receiving  a  retirement  annuity  under
Article  18  of  the Illinois Pension Code and who is covered
under  a  group  health  insurance  program  sponsored  by  a
governmental employer other than the State  of  Illinois  and
who  has  irrevocably  elected  to  waive his or her coverage
under this Act and to have his or her  spouse  considered  as
the  "annuitant"  under this Act and not as a "dependent"; or
(5) an employee who retires, or has retired, from a qualified
position, as determined according to rules promulgated by the
Director, under a qualified local government or  a  qualified
rehabilitation  facility  or  a  qualified  domestic violence
shelter or service. (For definition  of  "retired  employee",
see (p) post).
    (b-5)  "New  SERS  annuitant"  means  a person who, on or
after January 1, 1998, becomes an annuitant,  as  defined  in
subsection   (b),   by  virtue  of  beginning  to  receive  a
retirement annuity under Article 14 of the  Illinois  Pension
Code,  and is eligible to participate in the basic program of
group health benefits provided for annuitants under this Act.
    (b-6)  "New SURS annuitant" means a  person  who,  on  or
after  January  1,  1998, becomes an annuitant, as defined in
subsection  (b),  by  virtue  of  beginning  to   receive   a
retirement  annuity  under Article 15 of the Illinois Pension
Code, and is eligible to participate in the basic program  of
group health benefits provided for annuitants under this Act.
    (c)  "Carrier"   means   (1)   an  insurance  company,  a
corporation  organized  under  the  Limited  Health   Service
Organization Act or the Voluntary Health Services Plan Act, a
partnership,  or other nongovernmental organization, which is
authorized  to  do  group  life  or  group  health  insurance
business in Illinois, or (2)  the  State  of  Illinois  as  a
self-insurer.
    (d)  "Compensation"  means  salary  or wages payable on a
regular payroll by the State Treasurer on a  warrant  of  the
State Comptroller out of any State, trust or federal fund, or
by  the Governor of the State through a disbursing officer of
the State out of a trust or out of federal funds, or  by  any
Department  out  of State, trust, federal or other funds held
by the State Treasurer or the Department, to any  person  for
personal   services  currently  performed,  and  ordinary  or
accidental disability  benefits  under  Articles  2,  14,  15
(including  ordinary  or accidental disability benefits under
an optional  program  established  under  Section  15-158.2),
paragraphs (b) or (c) of Section 16-106, or Article 18 of the
Illinois  Pension Code, for disability incurred after January
1, 1966, or benefits payable under the Workers'  Compensation
or Occupational Diseases Act or benefits payable under a sick
pay  plan  established  in  accordance with Section 36 of the
State Finance Act. "Compensation" also means salary or  wages
paid  to  an  employee  of  any qualified local government or
qualified rehabilitation facility  or  a  qualified  domestic
violence shelter or service.
    (e)  "Commission"   means   the   State  Employees  Group
Insurance  Advisory  Commission  authorized  by   this   Act.
Commencing  July  1,  1984,  "Commission" as used in this Act
means  the  Illinois  Economic  and  Fiscal   Commission   as
established  by the Legislative Commission Reorganization Act
of 1984.
    (f)  "Contributory", when  referred  to  as  contributory
coverage,  shall  mean optional coverages or benefits elected
by the member toward the cost  of  which  such  member  makes
contribution, or which are funded in whole or in part through
the acceptance of a reduction in earnings or the foregoing of
an increase in earnings by an employee, as distinguished from
noncontributory  coverage or benefits which are paid entirely
by the State of Illinois without reduction  of  the  member's
salary.
    (g)  "Department"   means  any  department,  institution,
board, commission, officer, court or any agency of the  State
government  receiving  appropriations  and  having  power  to
certify  payrolls  to the Comptroller authorizing payments of
salary and wages against such appropriations as are  made  by
the  General  Assembly  from any State fund, or against trust
funds held by the State  Treasurer  and  includes  boards  of
trustees of the retirement systems created by Articles 2, 14,
15,  16  and  18  of the Illinois Pension Code.  "Department"
also includes the  Illinois  Comprehensive  Health  Insurance
Board and the Illinois Rural Bond Bank.
    (h)  "Dependent", when the term is used in the context of
the  health  and  life  plan, means a member's spouse and any
unmarried child (1) from birth to age 19 including an adopted
child, a child who lives with the member from the time of the
filing of a petition for adoption until entry of an order  of
adoption,  a stepchild or recognized child who lives with the
member in a parent-child relationship, or a child  who  lives
with  the member if such member is a court appointed guardian
of the child, or (2) age 19 to 23  enrolled  as  a  full-time
student  in any accredited school, financially dependent upon
the member, and eligible as a dependent  for  Illinois  State
income tax purposes, or (3) age 19 or over who is mentally or
physically  handicapped  as defined in the Illinois Insurance
Code. For the health plan only,  the  term  "dependent"  also
includes  any  person enrolled prior to the effective date of
this Section who is dependent upon the member to  the  extent
that  the  member  may  claim  such person as a dependent for
Illinois State income tax deduction purposes; no  other  such
person may be enrolled.
    (i)  "Director"   means  the  Director  of  the  Illinois
Department of Central Management Services.
    (j)  "Eligibility period" means  the  period  of  time  a
member  has  to  elect  enrollment  in  programs or to select
benefits without regard to age, sex or health.
    (k)  "Employee"  means  and  includes  each  officer   or
employee  in the service of a department who (1) receives his
compensation for service rendered  to  the  department  on  a
warrant   issued   pursuant  to  a  payroll  certified  by  a
department or on a warrant or check issued  and  drawn  by  a
department  upon  a  trust,  federal  or  other  fund or on a
warrant issued pursuant to a payroll certified by an  elected
or  duly  appointed  officer  of  the  State  or who receives
payment of the performance of personal services on a  warrant
issued  pursuant  to  a payroll certified by a Department and
drawn by the Comptroller upon  the  State  Treasurer  against
appropriations  made by the General Assembly from any fund or
against trust funds held by the State Treasurer, and  (2)  is
employed  full-time  or  part-time  in  a  position  normally
requiring actual performance of duty during not less than 1/2
of  a  normal  work period, as established by the Director in
cooperation with each department, except that persons elected
by popular vote  will  be  considered  employees  during  the
entire  term  for  which they are elected regardless of hours
devoted to the service of the  State,  and  (3)  except  that
"employee" does not include any person who is not eligible by
reason  of  such person's employment to participate in one of
the State retirement systems under Articles 2, 14, 15 (either
the  regular  Article  15  system  or  an  optional   program
established under Section 15-158.2) or 18, or under paragraph
(b)  or  (c) of Section 16-106, of the Illinois Pension Code,
but such term does include persons who  are  employed  during
the  6  month  qualifying  period  under  Article  14  of the
Illinois Pension Code.  Such term also  includes  any  person
who  (1)  after  January  1,  1966,  is receiving ordinary or
accidental disability  benefits  under  Articles  2,  14,  15
(including  ordinary  or accidental disability benefits under
an optional  program  established  under  Section  15-158.2),
paragraphs (b) or (c) of Section 16-106, or Article 18 of the
Illinois  Pension Code, for disability incurred after January
1, 1966, (2) receives  total  permanent  or  total  temporary
disability   under   the   Workers'   Compensation   Act   or
Occupational Disease Act as a result of injuries sustained or
illness contracted in the course of employment with the State
of  Illinois,  or (3) is not otherwise covered under this Act
and has retired as a participating member under Article 2  of
the   Illinois   Pension  Code  but  is  ineligible  for  the
retirement  annuity  under  Section  2-119  of  the  Illinois
Pension Code.  However, a person who satisfies  the  criteria
of  the  foregoing  definition of "employee" except that such
person  is  made  ineligible  to  participate  in  the  State
Universities Retirement System by clause  (4)  of  subsection
(a)  the  first  paragraph  of Section 15-107 of the Illinois
Pension Code is also an "employee" for the purposes  of  this
Act.   "Employee"  also  includes  any  person  receiving  or
eligible  for  benefits  under a sick pay plan established in
accordance  with  Section  36  of  the  State  Finance   Act.
"Employee"  also  includes  each  officer  or employee in the
service of a qualified local  government,  including  persons
appointed  as  trustees  of  sanitary districts regardless of
hours devoted to the service of the  sanitary  district,  and
each  employee  in  the service of a qualified rehabilitation
facility and each full-time employee  in  the  service  of  a
qualified domestic violence shelter or service, as determined
according to rules promulgated by the Director.
    (l)  "Member"   means  an  employee,  annuitant,  retired
employee or survivor.
    (m)  "Optional  coverages  or   benefits"   means   those
coverages  or  benefits available to the member on his or her
voluntary election, and at his or her own expense.
    (n)  "Program" means the  group  life  insurance,  health
benefits  and other employee benefits designed and contracted
for by the Director under this Act.
    (o)  "Health plan" means a self-insured health  insurance
program  offered by the State of Illinois for the purposes of
benefiting employees by means  of  providing,  among  others,
wellness  programs,  utilization reviews, second opinions and
medical fee reviews, as well as for paying for  hospital  and
medical care up to the maximum coverage provided by the plan,
to its members and their dependents.
    (p)  "Retired  employee" means any person who would be an
annuitant as that term is defined herein  but  for  the  fact
that such person retired prior to January 1, 1966.  Such term
also  includes any person formerly employed by the University
of Illinois in the Cooperative Extension Service who would be
an annuitant but for the  fact  that  such  person  was  made
ineligible   to   participate   in   the  State  Universities
Retirement System by clause (4) of subsection (a)  the  first
paragraph of Section 15-107 of the Illinois Pension Code.
    (p-6)  "New SURS retired employee" means a person who, on
or  after  January  1,  1998,  becomes a retired employee, as
defined in subsection  (p),  by  virtue  of  being  a  person
formerly  employed  by  the  University  of  Illinois  in the
Cooperative Extension Service who would be an  annuitant  but
for   the  fact  that  he  or  she  was  made  ineligible  to
participate in the State Universities  Retirement  System  by
clause  (4)  of  subsection  (a)  of  Section  15-107  of the
Illinois Pension Code, and who is eligible to participate  in
the  basic  program  of  group  health  benefits provided for
retired employees under this Act.
    (q)  "Survivor" means a person receiving an annuity as  a
survivor  of an employee or of an annuitant.  "Survivor" also
includes:  (1)  the  surviving  dependent  of  a  person  who
satisfies the  definition  of  "employee"  except  that  such
person  is  made  ineligible  to  participate  in  the  State
Universities  Retirement  System  by clause (4) of subsection
(a) the first paragraph of Section  15-107  of  the  Illinois
Pension  Code;  and (2) the surviving dependent of any person
formerly employed  by  the  University  of  Illinois  in  the
Cooperative  Extension  Service  who  would  be  an annuitant
except for the fact that such person was made  ineligible  to
participate  in  the  State Universities Retirement System by
clause (4) of subsection (a) the first paragraph  of  Section
15-107 of the Illinois Pension Code.
    (q-5)  "New  SERS  survivor" means a survivor, as defined
in subsection (q), whose annuity is paid under Article 14  of
the Illinois Pension Code and is based on the death of (i) an
employee  whose  death occurs on or after January 1, 1998, or
(ii) a new SERS annuitant as defined in subsection (b-5).
    (q-6)  "New SURS survivor" means a survivor,  as  defined
in  subsection (q), whose annuity is paid under Article 15 of
the Illinois Pension Code and is based on the death of (i) an
employee whose death occurs on or after January 1, 1998, (ii)
a new SURS annuitant as defined in subsection (b-6), or (iii)
a new SURS retired employee as defined in subsection (p-6).
    (r)  "Medical  services"  means  the  services   provided
within  the  scope  of their licenses by practitioners in all
categories licensed under the Medical Practice Act of 1987.
    (s)  "Unit  of  local  government"  means   any   county,
municipality,  township, school district, special district or
other unit, designated as a unit of local government by  law,
which  exercises  limited  governmental  powers  or powers in
respect to limited governmental subjects, any  not-for-profit
association   with   a  membership  that  primarily  includes
townships  and  township  officials,  that  has  duties  that
include  provision  of  research  service,  dissemination  of
information, and other acts  for  the  purpose  of  improving
township  government,  and that is funded wholly or partly in
accordance with Section  85-15  of  the  Township  Code;  any
not-for-profit  corporation or association, with a membership
consisting primarily of municipalities, that operates its own
utility   system,   and    provides    research,    training,
dissemination  of  information,  or  other  acts  to  promote
cooperation  between  and  among  municipalities that provide
utility services and for the advancement  of  the  goals  and
purposes  of  its membership; and the Illinois Association of
Park Districts.  "Qualified local government" means a unit of
local government approved by the Director  and  participating
in  a  program  created under subsection (i) of Section 10 of
this Act.
    (t)  "Qualified  rehabilitation   facility"   means   any
not-for-profit   organization   that  is  accredited  by  the
Commission on Accreditation of Rehabilitation  Facilities  or
certified  by  the Department of Human Services (as successor
to  the  Department  of  Mental  Health   and   Developmental
Disabilities)   to   provide   services   to   persons   with
disabilities  and  which  receives  funds  from  the State of
Illinois  for  providing  those  services,  approved  by  the
Director  and  participating  in  a  program  created   under
subsection (j) of Section 10 of this Act.
    (u)  "Qualified  domestic  violence  shelter  or service"
means any Illinois domestic violence shelter or  service  and
its  administrative offices funded by the Department of Human
Services (as successor to the Illinois Department  of  Public
Aid), approved by the Director and participating in a program
created under subsection (k) of Section 10.
    (v)  "TRS benefit recipient" means a person who:
         (1)  is  not  a "member" as defined in this Section;
    and
         (2)  is receiving a monthly  benefit  or  retirement
    annuity  under  Article  16 of the Illinois Pension Code;
    and
         (3)  either (i) has at least 8 years  of  creditable
    service under Article 16 of the Illinois Pension Code, or
    (ii) was enrolled in the health insurance program offered
    under  that  Article  on January 1, 1996, or (iii) is the
    survivor of a benefit recipient who had at least 8  years
    of  creditable  service  under Article 16 of the Illinois
    Pension Code or was  enrolled  in  the  health  insurance
    program  offered under that Article on the effective date
    of this amendatory Act of 1995, or (iv) is a recipient or
    survivor of a recipient of  a  disability  benefit  under
    Article 16 of the Illinois Pension Code.
    (w)  "TRS dependent beneficiary" means a person who:
         (1)  is  not a "member" or "dependent" as defined in
    this Section; and
         (2)  is a TRS benefit recipient's: (A)  spouse,  (B)
    dependent parent who is receiving at least half of his or
    her  support  from  the  TRS  benefit  recipient,  or (C)
    unmarried natural or adopted child who is (i)  under  age
    19,  or  (ii)  enrolled  as  a  full-time  student  in an
    accredited school, financially  dependent  upon  the  TRS
    benefit  recipient,  eligible as a dependent for Illinois
    State income tax purposes, and either is under age 24  or
    was,  on  January  1,  1996, participating as a dependent
    beneficiary in the health insurance program offered under
    Article 16 of the Illinois Pension Code, or (iii) age  19
    or  over  who  is  mentally  or physically handicapped as
    defined in the Illinois Insurance Code.
    (x)  "Military leave with pay  and  benefits"  refers  to
individuals  in basic training for reserves, special/advanced
training, annual training, emergency call up,  or  activation
by  the  President of the United States with approved pay and
benefits.
    (y)  "Military leave without pay and benefits" refers  to
individuals who enlist for active duty in a regular component
of  the  U.S.  Armed  Forces  or  other duty not specified or
authorized under military leave with pay and benefits.
(Source: P.A. 88-670,  eff.  12-2-94;  89-21,  eff.  6-21-95;
89-25,   eff.  6-21-95;  89-76,  eff.  7-1-95;  89-324,  eff.
8-13-95; 89-430, eff. 12-15-95; 89-502, eff. 7-1-96;  89-507,
eff. 7-1-97; 89-628, eff. 8-9-96; revised 8-23-96.)

    (5 ILCS 375/10) (from Ch. 127, par. 530)
    Sec. 10. Payments by State; premiums.
    (a)  The    State   shall   pay   the   cost   of   basic
non-contributory group life insurance and, subject to  member
paid  contributions set by the Department or required by this
Section, the basic program of group health benefits  on  each
eligible  member,  except  a member, not otherwise covered by
this Act, who has retired as  a  participating  member  under
Article  2 of the Illinois Pension Code but is ineligible for
the retirement annuity under Section 2-119  of  the  Illinois
Pension  Code, and part of each eligible member's and retired
member's premiums for health insurance coverage for  enrolled
dependents as provided by Section 9.  The State shall pay the
cost of the basic program of group health benefits only after
benefits  are  reduced  by  the amount of benefits covered by
Medicare for all retired members and retired dependents  aged
65  years  or older who are entitled to benefits under Social
Security  or  the  Railroad  Retirement  system  or  who  had
sufficient Medicare-covered government employment except that
such reduction in benefits shall apply only to those  retired
members  or  retired dependents who (1) first become eligible
for such Medicare coverage on or after July 1, 1992;  or  (2)
remain  eligible for, but no longer receive Medicare coverage
which they had been receiving on or after July 1,  1992.  The
Department  may  determine the aggregate level of the State's
contribution on the basis of actual cost of medical  services
adjusted  for  age,  sex  or  geographic or other demographic
characteristics which affect the costs of such programs.
    (a-1)  Beginning January 1, 1998,  for  each  person  who
becomes  a  new  SERS annuitant and participates in the basic
program of group health benefits, the State shall  contribute
toward  the  cost of the annuitant's coverage under the basic
program of group health benefits an amount  equal  to  5%  of
that cost for each full year of creditable service upon which
the  annuitant's retirement annuity is based, up to a maximum
of 100% for an annuitant with 20 or more years of  creditable
service.  The remainder of the cost of a new SERS annuitant's
coverage  under  the  basic  program of group health benefits
shall be the responsibility of the annuitant.
    (a-2)  Beginning January 1, 1998,  for  each  person  who
becomes  a  new  SERS  survivor and participates in the basic
program of group health benefits, the State shall  contribute
toward  the  cost  of the survivor's coverage under the basic
program of group health benefits an amount  equal  to  5%  of
that  cost  for  each full year of the deceased employee's or
deceased  annuitant's  creditable  service   in   the   State
Employees'  Retirement  System  of  Illinois  on  the date of
death, up to a maximum of 100% for a survivor of an  employee
or  annuitant  with  20  or more years of creditable service.
The remainder of the cost of the new SERS survivor's coverage
under the basic program of group health benefits shall be the
responsibility of the survivor.
    (a-3)  Beginning January 1, 1998,  for  each  person  who
becomes  a  new  SURS annuitant and participates in the basic
program of group health benefits, the State shall  contribute
toward  the  cost of the annuitant's coverage under the basic
program of group health benefits an amount  equal  to  5%  of
that cost for each full year of creditable service upon which
the  annuitant's retirement annuity is based, up to a maximum
of 100% for an annuitant with 20 or more years of  creditable
service.  The remainder of the cost of a new SURS annuitant's
coverage  under  the  basic  program of group health benefits
shall be the responsibility of the annuitant.
    (a-4)  Beginning January 1, 1998,  for  each  person  who
becomes  a  new SURS retired employee and participates in the
basic program of  group  health  benefits,  the  State  shall
contribute toward the cost of the retired employee's coverage
under  the  basic  program of group health benefits an amount
equal to 5% of that cost for each full year that the  retired
employee  was  an  employee  as defined in Section 3, up to a
maximum of 100% for a retired employee who  was  an  employee
for  20  or  more  years.  The remainder of the cost of a new
SURS retired employee's coverage under the basic  program  of
group  health  benefits  shall  be  the responsibility of the
retired employee.
    (a-5)  Beginning January 1, 1998,  for  each  person  who
becomes  a  new  SURS  survivor and participates in the basic
program of group health benefits, the State shall  contribute
toward  the  cost  of the survivor's coverage under the basic
program of group health benefits an amount  equal  to  5%  of
that  cost  for  each full year of the deceased employee's or
deceased  annuitant's  creditable  service   in   the   State
Employees'  Retirement  System  of  Illinois  on  the date of
death, up to a maximum of 100% for a survivor of an  employee
or  annuitant  with  20  or more years of creditable service.
The remainder of the cost of the new SURS survivor's coverage
under the basic program of group health benefits shall be the
responsibility of the survivor.
    (a-6)  A new SERS annuitant, new SERS survivor, new  SURS
annuitant,  new  SURS  retired employee, or new SURS survivor
may waive or terminate  coverage  in  the  program  of  group
health  benefits.   Any  such annuitant, survivor, or retired
employee who has waived or terminated coverage may enroll  or
re-enroll in the program of group health benefits only during
the  annual  benefit  choice  period,  as  determined  by the
Director; except that in the event of termination of coverage
due to nonpayment of premiums, the  annuitant,  survivor,  or
retired employee may not re-enroll in the program.
    (a-7)  No  later  than  May  1 of each calendar year, the
Director of Central  Management  Services  shall  certify  in
writing  to  the  Executive Secretary of the State Employee's
Retirement System the  amounts  of  the  Medicare  supplement
health  care  premiums  and  the  amounts  of the health care
premiums  for  all  other  retirees  who  are  not   Medicare
eligible.
    A  separate  calculation  of  the premiums based upon the
actual cost of each health care plan shall be so certified.
    The Director of Central Management Services shall provide
to the Executive Secretary of the State Employee's Retirement
System such information statistics, and other data as  he/she
may  require  to  review the premium amounts certified by the
Director of Central Management Services.
    (b)  State employees who become eligible for this program
on or after January 1, 1980 in positions, normally  requiring
actual performance of duty not less than 1/2 of a normal work
period  but  not equal to that of a normal work period, shall
be  given  the  option  of  participating  in  the  available
program. If the employee elects  coverage,  the  State  shall
contribute  on  behalf  of  such  employee to the cost of the
employee's benefit and any applicable  dependent  supplement,
that  sum  which bears the same percentage as that percentage
of time the employee regularly works when compared to  normal
work period.
    (c)  The  basic  non-contributory coverage from the basic
program of group health benefits shall be continued for  each
employee  not in pay status or on active service by reason of
(1) leave of absence due to illness or injury, (2) authorized
educational leave of absence  or  sabbatical  leave,  or  (3)
military  leave  with  pay  and benefits. This coverage shall
continue until expiration of authorized leave and  return  to
active  service, but not to exceed 24 months for leaves under
item (1) or (2). This 24-month limitation and the requirement
of returning to active service shall  not  apply  to  persons
receiving  ordinary  or  accidental  disability  benefits  or
retirement  benefits through the appropriate State retirement
system  or  benefits  under  the  Workers'  Compensation   or
Occupational Disease Act.
    (d)  The   basic  group  life  insurance  coverage  shall
continue, with full State contribution, where such person  is
(1)  absent  from  active  service  by  reason  of disability
arising from any cause  other  than  self-inflicted,  (2)  on
authorized  educational leave of absence or sabbatical leave,
or (3) on military leave with pay and benefits.
    (e)  Where the person is in non-pay status for  a  period
in  excess  of  30 days or on leave of absence, other than by
reason of disability, educational  or  sabbatical  leave,  or
military  leave  with  pay  and  benefits,  such  person  may
continue  coverage  only  by making personal payment equal to
the amount normally contributed by the State on such person's
behalf. Such payments and  coverage  may  be  continued:  (1)
until  such  time  as the person returns to a status eligible
for coverage at State expense, but not to exceed  24  months,
(2)  until  such person's employment or annuitant status with
the State is terminated, or (3) for a  maximum  period  of  4
years for members on military leave with pay and benefits and
military  leave  without  pay  and benefits (exclusive of any
additional service imposed pursuant to law).
    (f)  The Department shall  establish by rule  the  extent
to which other employee benefits will continue for persons in
non-pay status or who are not in active service.
    (g)  The  State  shall  not  pay  the  cost  of the basic
non-contributory group  life  insurance,  program  of  health
benefits  and  other  employee  benefits  for members who are
survivors as defined by paragraphs (1) and (2) of  subsection
(q)  of  Section  3  of  this Act.  The costs of benefits for
these survivors shall be paid by  the  survivors  or  by  the
University  of Illinois Cooperative Extension Service, or any
combination thereof.
    (h)  Those   persons   occupying   positions   with   any
department as a result of emergency appointments pursuant  to
Section  8b.8  of  the  Personnel Code who are not considered
employees under  this  Act  shall  be  given  the  option  of
participating in the programs of group life insurance, health
benefits  and other employee benefits.  Such persons electing
coverage may participate only by making payment equal to  the
amount  normally  contributed  by  the  State  for  similarly
situated  employees.  Such amounts shall be determined by the
Director.  Such payments and coverage may be continued  until
such  time as the person becomes an employee pursuant to this
Act or such person's appointment is terminated.
    (i)  Any unit of local government  within  the  State  of
Illinois  may  apply  to  the Director to have its employees,
annuitants,  and  their  dependents  provided  group   health
coverage   under   this  Act  on  a  non-insured  basis.   To
participate, a unit of local government must agree to  enroll
all  of  its  employees, who may select coverage under either
the State group health insurance plan or a health maintenance
organization  that  has  contracted  with  the  State  to  be
available as a health care provider for employees as  defined
in  this  Act.   A  unit  of  local government must remit the
entire cost of  providing  coverage  under  the  State  group
health  insurance  plan  or,  for  coverage  under  a  health
maintenance   organization,   an  amount  determined  by  the
Director based on an analysis of  the  sex,  age,  geographic
location,  or  other  relevant  demographic variables for its
employees, except that the unit of local government shall not
be required to enroll those of its employees who are  covered
spouses or dependents under this plan or another group policy
or   plan  providing  health  benefits  as  long  as  (1)  an
appropriate  official  from  the  unit  of  local  government
attests that each employee not enrolled is a  covered  spouse
or dependent under this plan or another group policy or plan,
and  (2)  at  least 85% of the employees are enrolled and the
unit of local government remits the entire cost of  providing
coverage  to  those  employees.  Employees of a participating
unit of local government who are not enrolled due to coverage
under another group health policy or plan  may  enroll  at  a
later  date subject to submission of satisfactory evidence of
insurability and provided that no benefits shall  be  payable
for  services  incurred during the first 6 months of coverage
to the extent  the  services  are   in  connection  with  any
pre-existing   condition.   A  participating  unit  of  local
government may also elect to cover its annuitants.  Dependent
coverage shall be offered on  an  optional  basis,  with  the
costs paid by the unit of local government, its employees, or
some  combination  of  the  two  as determined by the unit of
local government.  The unit  of  local  government  shall  be
responsible   for   timely  collection  and  transmission  of
dependent premiums.
    The Director shall annually determine  monthly  rates  of
payment, subject to the following constraints:
         (1)  In  the first year of coverage, the rates shall
    be  equal  to  the  amount  normally  charged  to   State
    employees  for elected optional coverages or for enrolled
    dependents coverages or other contributory coverages,  or
    contributed by the State for basic insurance coverages on
    behalf of its employees, adjusted for differences between
    State  employees and employees of the local government in
    age,  sex,  geographic   location   or   other   relevant
    demographic  variables,  plus an amount sufficient to pay
    for the  additional  administrative  costs  of  providing
    coverage to employees of the unit of local government and
    their dependents.
         (2)  In subsequent years, a further adjustment shall
    be  made  to  reflect  the  actual  prior  years'  claims
    experience   of  the  employees  of  the  unit  of  local
    government.
    In the case of coverage  of  local  government  employees
under  a  health maintenance organization, the Director shall
annually determine  for  each  participating  unit  of  local
government the maximum monthly amount the unit may contribute
toward  that  coverage,  based on an analysis of (i) the age,
sex, geographic  location,  and  other  relevant  demographic
variables  of the unit's employees and (ii) the cost to cover
those employees under the State group health insurance  plan.
The  Director  may  similarly  determine  the maximum monthly
amount each unit of local government  may  contribute  toward
coverage   of   its  employees'  dependents  under  a  health
maintenance organization.
    Monthly payments by the unit of local government  or  its
employees  for  group  health insurance or health maintenance
organization  coverage  shall  be  deposited  in  the   Local
Government   Health   Insurance   Reserve  Fund.   The  Local
Government  Health  Insurance  Reserve  Fund   shall   be   a
continuing  fund not subject to fiscal year limitations.  All
expenditures from this fund shall be used  for  payments  for
health  care benefits for local government and rehabilitation
facility  employees,  annuitants,  and  dependents,  and   to
reimburse   the  Department  or  its  administrative  service
organization for all expenses incurred in the  administration
of  benefits.   No  other  State  funds may be used for these
purposes.
    A local government employer's participation or desire  to
participate  in a program created under this subsection shall
not  limit  that  employer's  duty  to   bargain   with   the
representative  of  any  collective  bargaining  unit  of its
employees.
    (j)  Any rehabilitation  facility  within  the  State  of
Illinois  may  apply  to  the Director to have its employees,
annuitants,  and  their  dependents  provided  group   health
coverage   under   this   Act  on  a  non-insured  basis.  To
participate, a rehabilitation facility must agree  to  enroll
all  of  its employees and remit the entire cost of providing
such  coverage   for   its   employees,   except   that   the
rehabilitation facility shall not be required to enroll those
of  its employees who are covered spouses or dependents under
this plan or another group policy or  plan  providing  health
benefits  as  long  as  (1)  an appropriate official from the
rehabilitation  facility  attests  that  each  employee   not
enrolled  is a covered spouse or dependent under this plan or
another group policy or plan, and (2) at  least  85%  of  the
employees are enrolled and the rehabilitation facility remits
the  entire  cost  of  providing coverage to those employees.
Employees of a participating rehabilitation facility who  are
not  enrolled  due  to  coverage  under  another group health
policy or  plan  may  enroll  at  a  later  date  subject  to
submission  of  satisfactory  evidence  of  insurability  and
provided  that  no  benefits  shall  be  payable for services
incurred during the first 6 months of coverage to the  extent
the   services   are  in  connection  with  any  pre-existing
condition. A participating rehabilitation facility  may  also
elect  to  cover  its annuitants. Dependent coverage shall be
offered on an optional basis, with  the  costs  paid  by  the
rehabilitation  facility,  its employees, or some combination
of the 2 as determined by the  rehabilitation  facility.  The
rehabilitation  facility  shall  be  responsible  for  timely
collection and transmission of dependent premiums.
    The  Director shall annually determine quarterly rates of
payment, subject to the following constraints:
         (1)  In the first year of coverage, the rates  shall
    be   equal  to  the  amount  normally  charged  to  State
    employees for elected optional coverages or for  enrolled
    dependents  coverages  or other contributory coverages on
    behalf of its employees, adjusted for differences between
    State  employees  and  employees  of  the  rehabilitation
    facility  in  age,  sex,  geographic  location  or  other
    relevant demographic variables, plus an amount sufficient
    to  pay  for  the  additional  administrative  costs   of
    providing  coverage  to  employees  of the rehabilitation
    facility and their dependents.
         (2)  In subsequent years, a further adjustment shall
    be  made  to  reflect  the  actual  prior  years'  claims
    experience  of  the  employees  of   the   rehabilitation
    facility.
    Monthly  payments  by  the rehabilitation facility or its
employees for group health insurance shall  be  deposited  in
the Local Government Health Insurance Reserve Fund.
    (k)  Any  domestic violence shelter or service within the
State of Illinois may apply  to  the  Director  to  have  its
employees,  annuitants,  and  their dependents provided group
health coverage under this Act on a  non-insured  basis.   To
participate,  a  domestic  violence  shelter  or service must
agree to enroll all of its employees and pay the entire  cost
of   providing   such   coverage   for   its   employees.   A
participating domestic violence shelter  may  also  elect  to
cover its annuitants.  Dependent coverage shall be offered on
an optional basis, with employees, or some combination of the
2  as determined by the domestic violence shelter or service.
The domestic violence shelter or service shall be responsible
for timely collection and transmission of dependent premiums.
    The Director shall annually determine quarterly rates  of
payment, subject to the following constraints:
         (1)  In  the first year of coverage, the rates shall
    be  equal  to  the  amount  normally  charged  to   State
    employees  for elected optional coverages or for enrolled
    dependents coverages or other contributory  coverages  on
    behalf of its employees, adjusted for differences between
    State  employees  and  employees of the domestic violence
    shelter or service in age, sex,  geographic  location  or
    other  relevant  demographic  variables,  plus  an amount
    sufficient to pay for the additional administrative costs
    of  providing  coverage  to  employees  of  the  domestic
    violence shelter or service and their dependents.
         (2)  In subsequent years, a further adjustment shall
    be  made  to  reflect  the  actual  prior  years'  claims
    experience of the  employees  of  the  domestic  violence
    shelter or service.
         (3)  In  no  case  shall  the  rate be less than the
    amount normally charged to State employees or contributed
    by the State on behalf of its employees.
    Monthly payments by  the  domestic  violence  shelter  or
service  or its employees for group health insurance shall be
deposited in the Local Government  Health  Insurance  Reserve
Fund.
    (l)  A  public  community  college  or  entity  organized
pursuant to the Public Community College Act may apply to the
Director  initially to have only annuitants not covered prior
to July 1, 1992 by the district's health plan provided health
coverage  under  this  Act  on  a  non-insured  basis.    The
community   college   must   execute  a  2-year  contract  to
participate in  the  Local  Government  Health  Plan.   Those
annuitants  enrolled initially under this contract shall have
no benefits payable for services incurred during the first  6
months  of  coverage  to  the  extent  the  services  are  in
connection  with  any  pre-existing condition.  Any annuitant
who may enroll after this initial enrollment period shall  be
subject   to   submission   of   satisfactory   evidence   of
insurability and to the pre-existing conditions limitation.
    The  Director  shall  annually determine monthly rates of
payment subject to  the  following  constraints:   for  those
community  colleges with annuitants only enrolled, first year
rates shall be equal to the average cost to cover claims  for
a   State   member   adjusted   for   demographics,  Medicare
participation, and other factors; and in the second  year,  a
further  adjustment  of  rates  shall  be made to reflect the
actual  first  year's  claims  experience  of   the   covered
annuitants.
    (m)  The  Director shall adopt any rules deemed necessary
for implementation of this amendatory Act of 1989 (Public Act
86-978).
(Source: P.A. 88-45; 89-53, eff. 7-1-95; 89-236, eff. 8-4-95;
89-324, eff. 8-13-95; 89-626, eff. 8-9-96.)

    Section 10.  The State Finance Act is amended by changing
Section 14a as follows:

    (30 ILCS 105/14a) (from Ch. 127, par. 150a)
    Sec. 14a.  Payments for  unused  benefits;  use  of  sick
leave.
    (a)  Upon  the  death  of  a  State  employee, his or her
estate is entitled to  receive  from  the  appropriation  for
personal  services  available  for  payment  of  his  or  her
compensation  such  sum  for  any  accrued  vacation  period,
accrued  overtime, and accrued qualifying sick leave as would
have been paid or allowed to such  employee  had  he  or  she
survived and terminated his or her employment.
    The  State  Comptroller  shall  draw  a  his  warrant  or
warrants  against the appropriation, upon receipt of a proper
death certificate, payable to decedent's  estate,  or  if  no
estate  is  opened, to the person or persons entitled thereto
under Section 25-1 of the Probate Act of 1975 upon receipt of
the affidavit referred to in that Section, for the sum due.
    (b)  The Department of Central Management Services  shall
prescribe  by  rule  the  method  of  computing  the  accrued
vacation  period  and  accrued  overtime  for  all employees,
including those not otherwise subject  to  its  jurisdiction,
and  for  the  purposes of this Act the Department of Central
Management Services may require  such  reports  as  it  deems
necessary.   Accrued sick leave shall be computed as provided
in subsection (f) by multiplying 1/2 of the number of days of
accumulated sick leave by  the  daily  rate  of  compensation
applicable  to  the  employee  at  the  time  of  his  death,
retirement,  resignation  or  other  termination  of  service
described in this Section.
    (c)  Upon  the  retirement  or  resignation  of  a  State
employee  from  State  service,  his or her accrued vacation,
overtime and qualifying sick leave shall be  payable  to  the
employee  in  a  single  lump  sum  payment.  However, if the
employee returns to employment in any capacity with the  same
agency or department within 30 days of the termination of his
or  her  previous  State  employment, the employee must, as a
condition of his or her new State employment, repay the  lump
sum  amount  within  30  days  after  his  or  her  new State
employment commences.  The amount repaid shall  be  deposited
into  the fund from which the payment was made or the General
Revenue Fund, and the accrued  vacation,  overtime  and  sick
leave  upon  which  the  lump  sum payment was based shall be
credited to the account of the employee  in  accordance  with
the  rules  of  the  jurisdiction  under  which  he or she is
employed.
    (d)  Upon  the  movement  of  a  State  employee  from  a
position subject to  the  Personnel  Code  to  another  State
position  not subject to the Personnel Code, or to a position
subject to the Personnel  Code  from  a  State  position  not
subject  to  the  Personnel  Code,  or upon the movement of a
State employee of an institution or  agency  subject  to  the
State   Universities  Civil  Service  System  from  one  such
institution or agency to another such institution or  agency,
his or her accrued vacation, overtime and sick leave shall be
credited  to  the  employee's  account in accordance with the
rules of the jurisdiction to which the State employee  moved.
However, if the rules preclude crediting the State employee's
total  accrued vacation, overtime or sick leave to his or her
account at the jurisdiction to which he or she  is  to  move,
the   nontransferable   nontransferrable   accrued  vacation,
overtime, and qualifying or sick leave shall  be  payable  to
the employee in a single lump sum payment by the jurisdiction
from which he or she moved.
    (e)  Upon   the   death   of  a  State  employee  or  the
retirement, indeterminate layoff or resignation  of  a  State
employee  from  State  service,  the employee's retirement or
disability benefits shall be computed as if the employee  had
remained  in  the  State employment at his or her most recent
rate of compensation until  his  or  her  accumulated  unused
leave  for vacation, overtime, sickness and personal business
would  have  been  exhausted.   The  employing  agency  shall
certify, in writing to the employee, the  unused  leaves  the
employee  has accrued.  This certification may be held by the
employee or forwarded  to  the  retirement  fund.   Employing
agencies  not covered by the Personnel Code shall certify, in
writing to the employee, the unused leaves the  employee  has
accrued.
    (f)  Accrued  sick leave shall be computed by multiplying
1/2 of the number of days of accumulated sick  leave  by  the
daily  rate of compensation applicable to the employee at the
time of his or her death, retirement, resignation,  or  other
termination of service described in this Section.
    The  payment  for qualifying accrued sick leave after the
employee's   death,   retirement,   resignation,   or   other
termination of service provided by Public Act 83-976 shall be
for sick leave days earned on or after January  1,  1984  and
before  January  1, 1998.  Sick leave accumulated on or after
January 1, 1998 is not compensable under this Section at  the
time  of  the  employee's  death, retirement, resignation, or
other termination of service, but may be  used  to  establish
retirement  system service credit as provided in the Illinois
Pension Code.
    The  Department  of  Central  Management  Services  shall
prescribe by rule the method of computing  the  accrued  sick
leave  days  for all employees, including those not otherwise
subject to its jurisdiction.  Beginning January 1, 1998, sick
leave used by an employee shall be charged against his or her
accumulated sick leave in the following order:   first,  sick
leave  accumulated  before  January  1, 1984; then sick leave
accumulated on or after January 1,  1998;  and  finally  sick
leave  accumulated  on  or  after  January 1, 1984 but before
January 1, 1998.
(Source: P.A. 87-384; 87-721; 87-895; 87-1234.)

    Section 12.  The Illinois  Pension  Code  is  amended  by
changing   Sections  15-112,  15-113.2,  15-113.3,  15-113.4,
15-113.5,  15-113.7,  15-125,  15-136.2,  15-143,   15-153.2,
15-157,  15-167.2, 15-185, 15-190, 15-191, and adding Section
15-168.1 as follows:

    (40 ILCS 5/15-112) (from Ch. 108 1/2, par. 15-112)
    Sec. 15-112.  Final rate of  earnings.   "Final  rate  of
earnings":  For an employee who is paid on an hourly basis or
who  receives  an  annual  salary  in  installments during 12
months of each academic year,  the  average  annual  earnings
during  the  48 consecutive calendar month period ending with
the last day of final termination  of  employment  or  the  4
consecutive academic years of service in which the employee's
earnings  were  the  highest,  whichever is greater.  For any
other employee, the average  annual  earnings  during  the  4
consecutive  academic  years  of  service in which his or her
earnings were the highest.  For an employee with less than 48
months or  4  consecutive  academic  years  of  service,  the
average  earnings during his or her entire period of service.
The earnings of an employee  with  more  than  36  months  of
service  prior to the date of becoming a participant are, for
such period, considered equal to the average earnings  during
the last 36 months of such service.  For an employee on leave
of  absence  with pay, or on leave of absence without pay who
makes contributions during such leave, earnings  are  assumed
to  be  equal to the basic compensation on the date the leave
began.  For an employee on  disability  leave,  earnings  are
assumed  to  be  equal  to the basic compensation on the date
disability occurs or  the  average  earnings  during  the  24
months  immediately  preceding  the month in which disability
occurs, whichever is greater.
    If a participant is an employee for  at  least  6  months
during  the  academic  year in which his or her employment is
terminated, the annual final rate of earnings shall be 25% of
the sum of (1) the annual basic compensation for  that  year,
and  (2)  the  amount earned during the 36 months immediately
preceding that year, if this is greater than the  final  rate
of  earnings as calculated under the other provisions of this
Section.
    In the determination of the final rate of earnings for an
employee,  that  part  of  an  employee's  earnings  for  any
academic year beginning after June 30,  1997,  which  exceeds
the  employee's earnings with that employer for the preceding
year by more than 20 percent shall be excluded; in the  event
that  an  employee has more than one employer this limitation
shall be calculated separately for  the  earnings  with  each
employer.    In  making  such  calculation,  only  the  basic
compensation of employees shall be considered, without regard
to  vacation  or  overtime  or  to   contracts   for   summer
employment.
    The   following   are   not  considered  as  earnings  in
determining  final  rate   of   earnings:   separation   pay,
retirement  pay,  payment  in  lieu  of unused sick leave and
payments from an employer for the period used in  determining
final  rate  of  earnings for any purpose other than services
rendered, leave of absence or vacation  granted  during  that
period,  and  vacation  of  up  to  56 work days allowed upon
termination of employment  under  a  vacation  policy  of  an
employer which was in effect on or before January 1, 1977.
    Intermittent  periods  of  service shall be considered as
consecutive in determining final rate of earnings.
(Source: P.A. 84-1472.)

    (40 ILCS 5/15-113.2) (from Ch. 108 1/2, par. 15-113.2)
    Sec. 15-113.2.  Service for leaves of  absence.  "Service
for  leaves  of  absence" includes those periods of leaves of
absence at less than  50%  pay,  except  military  leave  and
periods  of  disability leave in excess of 60 days, for which
the employee pays the contributions  required  under  Section
15-157 in accordance with rules prescribed by the board based
upon  the employee's basic compensation on the date the leave
begins, or in the case of leave for service  with  a  teacher
organization,  based upon the actual compensation received by
the employee for such service after January 26, 1988, if  the
employee  so  elects  within 30 days of that date or the date
the leave for service with  a  teacher  organization  begins,
whichever is later; provided that the employee (1) returns to
employment  covered  by  this system at the expiration of the
leave,  or  within  30  days  after  the  termination  of   a
disability  which  occurs during the leave and continues this
employment at a percentage of time equal to or  greater  than
the  percentage  of  time  immediately preceding the leave of
absence for at least 8 consecutive months or a  period  equal
to  the  period  of  the  leave, whichever is less, or (2) is
precluded from meeting the foregoing  conditions  because  of
disability or death.  If service credit is denied because the
employee  fails  to  meet these conditions, the contributions
covering the leave  of  absence  shall  be  refunded  without
interest.   The return to employment condition does not apply
if the leave  of  absence  is  for  service  with  a  teacher
organization  and  the  leave  of absence is in effect on the
effective date of this amendatory Act of 1993.
    Service credit provided  under  this  Section  shall  not
exceed 3 years in any period of 10 years, unless the employee
is  on special leave granted by the employer for service with
a teacher organization.  Commencing with the fourth  year  in
any  period  of 10 years, a participant on such special leave
is also required to pay employer contributions equal  to  the
normal  cost  as  defined  in  Section 15-155, based upon the
employee's basic compensation on the date the  leave  begins,
or  based  upon  the  actual  compensation  received  by  the
employee  for  service  with  a  teacher  organization if the
employee has so elected.
(Source: P.A. 86-1488; 87-1265.)

    (40 ILCS 5/15-113.3) (from Ch. 108 1/2, par. 15-113.3)
    Sec. 15-113.3.  Service for periods of military  service.
"Service  for  periods  of military service":  Those periods,
not exceeding 5 years, during which a person  served  in  the
armed  forces  of the United States, of which all but 2 years
must have immediately followed a period of employment with an
employer under this system or the State Employees' Retirement
System of Illinois;  provided  that  the  person  received  a
discharge   other  than  dishonorable  and  again  became  an
employee under this System within one year  after  discharge.
However,  for  the  up  to  2  years  of military service not
immediately following employment,  the  applicant  must  make
contributions  to  the  System  (1)  at the rates provided in
Section 15-157 based upon the employee's  basic  compensation
on  the  last  date as a participating employee prior to such
military service, or on the first  date  as  a  participating
employee  after  such military service, whichever is greater,
plus (2) an amount determined by the board to be equal to the
employer's normal cost  of  the  benefits  accrued  for  such
military  service,  plus (3) interest on items (1) and (2) at
the effective rate from  the  later  of  the  date  of  first
membership  in  the  System  or  the  date  of  conclusion of
military service to the date of payment. The  change  in  the
required  contribution  for purchased military credit made by
this amendatory Act of 1993 does not entitle any person to  a
refund of contributions already paid.
    The  changes  to this Section made by this amendatory Act
of 1991 shall apply not only to persons who on or  after  its
effective  date  are in service under the System, but also to
persons whose  employment  terminated  prior  to  that  date,
whether  or  not the person is an annuitant on that date.  In
the case of an annuitant who  applies  for  credit  allowable
under  this Section for a period of military service that did
not immediately follow  employment,  and  who  has  made  the
required  contributions for such credit, the annuity shall be
recalculated to include the additional service  credit,  with
the  increase  taking  effect on the date the System received
written notification of the annuitant's  intent  to  purchase
the  credit,  if payment of all the required contributions is
made within 60 days of such notice,  or  else  on  the  first
annuity  payment  date  following  the date of payment of the
required contributions.  In calculating the automatic  annual
increase for an annuity that has been recalculated under this
Section,  the increase attributable to the additional service
allowable under this amendatory Act of 1991 shall be included
in the calculation of  automatic  annual  increases  accruing
after the effective date of the recalculation.
(Source: P.A. 87-794; 87-1265.)

    (40 ILCS 5/15-113.4) (from Ch. 108 1/2, par. 15-113.4)
    Sec.  15-113.4.   Service for unused sick leave. "Service
for unused sick leave":  A participant  who  is  an  employee
under  this  System  or  one  of the other systems subject to
Article 20 of this Code within 60 days immediately  preceding
the  date  on  which his or her retirement annuity begins, is
entitled to credit for service for  that  portion  of  unused
sick  leave  earned  in  the  course  of  employment  with an
employer  and   credited  on  the  date  of  termination   of
employment  by an employer for which payment is not received,
in accordance with the following  schedule:   30  through  90
full calendar days and 20 through 59 full work days of unused
sick  leave,  1/4  of  a year of service; 91 through 180 full
calendar days and 60 through 119 full work  days,  1/2  of  a
year  of  service; 181 through 270 full calendar days and 120
through 179 full work days, 3/4 of a year  of  service;   271
through  360 full calendar days and 180 through 240 full work
days, one year of service.  Only uncompensated,  unused  sick
leave  earned  in  accordance  with  an employer's sick leave
accrual policy generally applicable to employees or  a  class
of  employees  shall  be  taken  into  account in calculating
service credit under this Section.  Any uncompensated, unused
sick leave granted by an employer to facilitate  the  hiring,
retirement, termination, or other special circumstances of an
employee  shall  not  be  taken  into  account in calculating
service  credit  under  this  Section.    If  a   participant
transfers from one employer to another, the unused sick leave
credited  by  the  previous  employer  shall be considered in
determining service to be credited under this  Section,  even
if  the participant terminated service prior to the effective
date of P.A. 86-272 (August  23,  1989);  if  necessary,  the
retirement annuity shall be recalculated to reflect such sick
leave  credit.   Each employer shall certify to the board the
number  of  days  of  unused  sick  leave  accrued   to   the
participant's  credit  on  the  date  that  the participant's
status as an employee terminated.  This period of unused sick
leave shall not be considered in  determining  the  date  the
retirement annuity begins.
(Source: P.A. 86-272; 87-794.)

    (40 ILCS 5/15-113.5) (from Ch. 108 1/2, par. 15-113.5)
    Sec.  15-113.5.  Service for employment with other public
agencies in this State.  "Service for employment  with  other
public  agencies  in  this  State":  includes  the  following
periods:
    (a)  periods  during which a person rendered services for
the State of  Illinois,  prior  to  January  1,  1944,  under
employment  not  covered by this Article, if (1) such periods
would have been considered creditable service under the State
Employees' Retirement System of Illinois had that system been
in effect at that time,  and  (2)  service  credit  for  such
periods  has  not  been  granted  under  the State Employees'
Retirement System of Illinois.
    (b)  periods  credited   under   the   State   Employees'
Retirement  System of Illinois on the date an employee became
eligible  for  participation  in   the   State   Universities
Retirement  System  as  a  result  of  a  transfer of a State
function from a department, commission  or  other  agency  of
this  State  to  an employer, excluding periods as a "covered
employee" as defined in Article 14 of this Code, provided the
employee has received a refund of his  or  her  contributions
from  the  State Employees' Retirement System of Illinois and
pays to this system contributions equal to the amount of  the
refund  together  with compound interest at the rate required
for repayment of a refund under Section 15-154 from the  date
the refund is received to the date payment is made.
    (c)  periods  credited  in a retirement system covering a
governmental unit, as defined in Section 20-107 on the date a
person becomes a participant,  if  (1)  a  function  of  this
governmental  unit  is  transferred in whole or in part to an
employer, and (2) the person transfers  employment  from  the
governmental  unit to such employer within 6 months after the
employer begins operation  of  this  function,  and  (3)  the
person  cannot  qualify for a proportional retirement annuity
from the retirement system covering this  governmental  unit,
and  (4)  the  participant  receives  a  refund of his or her
contributions  from  the  retirement  system  covering   this
governmental unit and pays to this system contributions equal
to  the  amount of the refund together with compound interest
from the date the refund is made by the system  to  the  date
payment  is received by the board at the rate of 6% per annum
through August 31, 1982, and at  the  effective  rates  after
that date.
    (d)  periods  during  which  a participant contributed to
the Park Policemen's  Annuity  Fund  as  defined  in  Section
5-219,  provided  the participant and the Chicago Policemen's
Annuity Fund pay to this system  the  required  employee  and
employer contributions.
    (e)  periods  during which a person rendered services for
an athletic association affiliated  with  the  University  of
Illinois, provided that (1) the employee was employed by that
athletic   association   on  January  1,  1960,  (2)  annuity
contracts covering that employment  have  been  purchased  by
other  retirement  systems covering employees of the athletic
association, and (3) the employee files  with  the  board  an
election to become a participant and assigns to the board his
or her right, title, and interest in those annuity contracts.
(Source: P.A. 83-1440.)

    (40 ILCS 5/15-113.7) (from Ch. 108 1/2, par. 15-113.7)
    Sec.  15-113.7.  Service  for  other  public  employment.
"Service   for  other  public  employment":   Includes  those
periods not exceeding the lesser of 10 years or  2/3  of  the
service  granted under other Sections of this Article dealing
with service credit, during which a person was employed  full
time by the United States government, or by the government of
a  state,  or by a political subdivision of a state, or by an
agency or instrumentality of any of  the  foregoing,  if  the
person  (1)  cannot qualify for a retirement pension or other
benefit  based  upon  employer  contributions  from   another
retirement  system,  exclusive  of  federal  social security,
based in whole or in part upon this employment, and (2)  pays
the  lesser of (A) an amount equal to 8% of his or her annual
basic compensation on the date of  becoming  a  participating
employee  subsequent to this service multiplied by the number
of years of such service,  together  with  compound  interest
from  the  date  participation  begins to the date payment is
received by the board at the rate of  6%  per  annum  through
August  31, 1982, and at the effective rates after that date,
and (B) 50% of the actuarial value of  the  increase  in  the
retirement   annuity   provided  by  this  service,  and  (3)
contributes  for  at  least  5  years  subsequent   to   this
employment  to  one  or  more  of the following systems:  the
State   Universities   Retirement   System,   the   Teachers'
Retirement System of the State of Illinois,  and  the  Public
School  Teachers' Pension and Retirement Fund of Chicago.  If
a function of a  governmental  unit  as  defined  by  Section
20-107  is  transferred  by  law,  in  whole or in part to an
employer, and an  employee  transfers  employment  from  this
governmental  unit  to  such  employer within 6 months of the
transfer of the function, the payment for service  authorized
under  this  Section  shall not exceed the amount which would
have been payable for this service to the  retirement  system
covering  the  governmental  unit from which the function was
transferred.
    The service granted  under  this  Section  shall  not  be
considered  in determining whether the person has the minimum
of 8 years of service required to qualify  for  a  retirement
annuity  at  age  55  or  the  5 years of service required to
qualify for a retirement annuity at age 62,  as  provided  in
Section  15-135.    The maximum allowable service of 10 years
for this governmental employment  shall  be  reduced  by  the
service  credit  which  is  validated  under paragraph (3) of
Section 16-127 and paragraph one of Section 17-133.
    Except as hereinafter provided, this  Section  shall  not
apply  to persons who become participants in the system after
September 1, 1974.  Except as  hereinafter  provided,  credit
for military service under this Section shall be allowed only
to  persons who have applied for such credit before September
1, 1974.  The foregoing September 1, 1974, limitations do not
apply to any person who became a participant in the system on
or before January 15, 1977, and prior thereto, had a  minimum
of 20 years of service credit granted in the General Assembly
Retirement System.
(Source: P.A. 87-1265.)

    (40 ILCS 5/15-125) (from Ch. 108 1/2, par. 15-125)
    Sec.  15-125.   "Prescribed  Rate  of Interest; Effective
Rate of Interest":
    (1)  "Prescribed rate of interest": The rate of  interest
to  be  used  in  actuarial  valuations and in development of
actuarial tables as determined by the board on the  basis  of
the  probable  average  effective  rate of interest on a long
term basis.
    (2)  "Effective rate of interest": The interest rate  for
all  or  any  part of a fiscal year that is determined by the
board based  on  factors  including  the  system's  past  and
expected   investment  experience;  historical  and  expected
fluctuations  in  the  market  value  of   investments;   the
desirability  of  minimizing volatility in the effective rate
of interest from year to year; the provision of reserves  for
anticipated   losses   upon   sales,  redemptions,  or  other
disposition of investments and  for  variations  in  interest
experience.   This  amendatory Act of 1997 is a clarification
of existing law.  The  interest  rate  for  any  fiscal  year
determined by the board from the investment experience of the
preceding   fiscal   years   and   the  estimated  investment
experience of the current fiscal year.   In  determining  the
effective   rate   of  interest  to  be  credited  to  member
contribution accounts  and  other  reserves,  the  board  may
provide  for  reserves  for  anticipated  losses  upon sales,
redemptions or  other  disposition  of  investments  and  for
reserves for variations in interest experience.
(Source: P.A. 79-1146.)

    (40 ILCS 5/15-136.2) (from Ch. 108 1/2, par. 15-136.2)
    Sec.  15-136.2.  Early  retirement  without  discount.  A
participant whose retirement annuity  begins  after  June  1,
1981  and  on or before September 1, 2002 1997 and within six
months of the last day of  employment  for  which  retirement
contributions  were  required,  may  elect  at  the  time  of
application  to  make a one time employee contribution to the
System and thereby avoid the early  retirement  reduction  in
retirement  annuity specified under subsection (b) of Section
15-136.  The exercise of the election shall obligate the last
employer to also make a one time non-refundable  contribution
to the System.
    The one time employee and employer contributions shall be
a  percentage of the retiring participant's highest full time
annual salary rate  during  the  academic  years  which  were
considered  in determining his or her final rate of earnings,
or if not full time  then  the  full  time  equivalent.   The
employee  contribution  rate  shall  be  7% multiplied by the
lesser of the following 2 sums: (1) the number of years  that
the  participant  is  less  than age 60; or (2) the number of
years that the participant's creditable service is less  than
35  years.  The employer contribution shall be at the rate of
20% for each year the participant is less than age  60.   The
employer  shall  pay  the employer contribution from the same
source  of  funds  which  is  used  in  paying  earnings   to
employees.
    Upon  receipt of the application and election, the System
shall  determine  the  one   time   employee   and   employer
contributions.   The  provisions of this Section shall not be
applicable until all the above  outlined  contributions  have
been   received   by  the  System;  however,  the  date  such
contributions  are  received  shall  not  be  considered   in
determining the effective date of retirement.
    For  persons  who  apply to the Board after the effective
date of this amendatory Act of 1993 and before July 1,  1993,
requesting a retirement annuity to begin no earlier than July
1,  1993  and no later than June 30, 1994, the employer shall
pay both the employee  and  employer  contributions  required
under this Section.
    The  number  of  employees retiring under this Section in
any fiscal year may be limited at the option of the  employer
to  no  less  than 15% of those eligible.  The right to elect
early retirement without discount shall  be  allocated  among
those  applying  on  the basis of seniority in the service of
the last employer.
(Source: P.A. 87-794; 87-1265.)
    (40 ILCS 5/15-143) (from Ch. 108 1/2, par. 15-143)
    Sec. 15-143.  Death benefits -  General  provisions.  All
death  benefits  shall  be  paid  as  a  single  cash  sum or
otherwise as the beneficiary and the  board  mutually  agree,
except  where  an  annuity is payable under Section 15-144. A
death benefit shall be paid  as  soon  as  practicable  after
receipt  by  the  board  of  (1) a written application by the
beneficiary and (2) such evidence of death and identification
as the board shall require.
(Source: P.A. 83-1440.)

    (40 ILCS 5/15-153.2) (from Ch. 108 1/2, par. 15-153.2)
    Sec.  15-153.2.   Disability   retirement   annuity.    A
participant  whose disability benefits are discontinued under
the provisions of  clause  (6)  (5)  of  Section  15-152,  is
entitled  to  a  disability  retirement annuity of 35% of the
basic compensation which was payable to  the  participant  at
the  time that disability began, provided at least 2 licensed
and practicing physicians appointed by the board certify that
the participant has  a  medically  determinable  physical  or
mental  impairment  which  would  prevent  him  or  her  from
engaging  in  any substantial gainful activity, and which can
be expected to result in death or which has lasted or can  be
expected  to last for a continuous period of not less than 12
months.  The terms "medically determinable physical or mental
impairment" and "substantial gainful activity" shall have the
meanings ascribed to them in the "Social  Security  Act",  as
now   or   hereafter  amended,  and  the  regulations  issued
thereunder.
    The disability retirement annuity  payment  period  shall
begin  immediately following the expiration of the disability
benefit payments under clause (6) (5) of Section  15-152  and
shall  be  discontinued  when  (1)  the  physical  or  mental
impairment  no  longer prevents the participant from engaging
in any substantial gainful activity, (2) the participant dies
or (3) the participant elects to receive a retirement annuity
under Sections 15-135 and 15-136.  If a  person's  disability
retirement  annuity  is  discontinued  under  clause (1), all
rights and credits accrued in the system on the date that the
disability retirement annuity began shall  be  restored,  and
the disability retirement annuity paid shall be considered as
disability payments under clause (6) (5) of Section 15-152.
(Source: P.A. 83-1440.)

    (40 ILCS 5/15-157) (from Ch. 108 1/2, par. 15-157)
    Sec. 15-157.  Employee Contributions.
    (a)  Each participating employee shall make contributions
towards  the  retirement  annuity of each payment of earnings
applicable to employment under this system on and  after  the
date   of  becoming  a  participant  as  follows:   Prior  to
September 1, 1949, 3 1/2% of earnings; from September 1, 1949
to August 31, 1955, 5%; from September 1, 1955 to August  31,
1969,   6%;   from   September   1,  1969,  6  1/2%.    These
contributions are to be considered  as  normal  contributions
for purposes of this Article.
    Each  participant  who is a police officer or firefighter
shall make normal contributions of  8%  of  each  payment  of
earnings  applicable  to  employment  as  a police officer or
firefighter under this system on or after September 1,  1981,
unless  he  or  she files with the board within 60 days after
the effective date of this amendatory Act of 1991 or 60  days
after the board receives notice that he or she is employed as
a  police  officer  or  firefighter,  whichever  is  later, a
written notice waiving the  retirement  formula  provided  by
Rule  4 of Section 15-136.  This waiver shall be irrevocable.
If a participant had met the conditions set forth in  Section
15-132.1  prior  to the effective date of this amendatory Act
of  1991  but  failed   to   make   the   additional   normal
contributions required by this paragraph, he or she may elect
to pay the additional contributions plus compound interest at
the  effective  rate.   If  such  payment  is received by the
board, the service shall  be  considered  as  police  officer
service in calculating the retirement annuity under Rule 4 of
Section 15-136.
    (b)  Starting   September  1,  1969,  each  participating
employee shall make additional contributions of 1/2 of 1%  of
earnings  to  finance  a  portion  of  the cost of the annual
increases  in  retirement  annuity  provided  under   Section
15-136.
    (c)  Each  participating  employee  shall  make survivors
insurance contributions of 1% of  earnings  applicable  under
this  system  on  and after August 1, 1959.  Contributions in
excess of $80 during any fiscal year beginning before  August
31,  1969  and  in  excess  of  $120  during  any fiscal year
thereafter until September 1, 1971  shall  be  considered  as
additional contributions for purposes of this Article.
    (d)  If the board by board rule so permits and subject to
such  conditions  and  limitations as may be specified in its
rules, a participant may make other additional  contributions
of  such percentage of earnings or amounts as the participant
shall elect in a  written  notice  thereof  received  by  the
board.
    (e)  That  fraction  of a participant's total accumulated
normal contributions, the numerator of which is equal to  the
number  of  years  of  service  in  excess  of  that which is
required to qualify for the maximum retirement  annuity,  and
the denominator of which is equal to the total service of the
participant,  shall  be  considered as accumulated additional
contributions.  The determination of the  applicable  maximum
annuity  and the adjustment in contributions required by this
provision shall be made as of the date of  the  participant's
retirement.
    (f)  Notwithstanding   the   foregoing,  a  participating
employee shall not be required to  make  contributions  under
this  Section  after  the date upon which continuance of such
contributions would otherwise cause  his  or  her  retirement
annuity to exceed the maximum retirement annuity as specified
in clause (1) of subsection (c) of Section 15-136.
(Source: P.A. 86-272; 86-1488.)

    (40 ILCS 5/15-167.2) (from Ch. 108 1/2, par. 15-167.2)
    Sec.  15-167.2.  To issue bonds.  To borrow money and, in
evidence of its obligation to repay the borrowing,  to  issue
bonds  for  the purpose of financing the cost of any project.
The bonds shall be authorized pursuant to a resolution to  be
adopted  by the board setting forth all details in connection
with the bonds.
    The principal amount of  the  outstanding  bonds  of  the
board shall not at any time exceed $20,000,000 $10,000,000.
    The  bonds may be issued in one or more series, bear such
date or dates, become due at such time  or  times  within  40
years,  bear  interest  payable at such intervals and at such
rate or rates, which rates may be fixed or  variable,  be  in
such   denominations,   be   in  such  form,  either  coupon,
registered or book-entry, carry such conversion, registration
and exchange privileges, be subject to defeasance  upon  such
terms,  have  such  rank  or  priority,  be  executed in such
manner, be payable in such medium of payment at such place or
places  within  or  without  the  State  of  Illinois,   make
provision for a corporate trustee within or without the State
of Illinois with respect to such bonds, prescribe the rights,
powers  and duties thereof to be exercised for the benefit of
the board, the system and the protection of the  bondholders,
provide  for  the  holding  in  trust,  investment and use of
moneys, funds and accounts held in connection  therewith,  be
subject  to such terms of redemption with or without premium,
and be sold in such manner at private or public sale  and  at
such price, all as the board shall determine.  Whenever bonds
are sold at a price less than par, they shall be sold at such
price and bear interest at such rate or rates that either the
true  interest  cost (yield) or the net interest rate, as may
be selected by the board, received  upon  the  sale  of  such
bonds  does not exceed the maximum interest rate permitted by
the Bond Authorization Act, as amended at  the  time  of  the
making of the contract.
    Any  bonds  may be refunded or advance refunded upon such
terms as the board may determine for such term of years,  not
exceeding  40  years, and in such principal amount, as may be
deemed  necessary  by  the  board.   Any  redemption  premium
payable upon the redemption of bonds may be payable from  the
proceeds  of  refunding  bonds  issued  for  the  purpose  of
refunding  such  bonds, from any lawfully available source or
from both refunding bond proceeds and such other sources.
    The bonds or refunding bonds shall be obligations of  the
board payable from the income, interest and dividends derived
from  investments  of  the board, all as may be designated in
the resolution of the board authorizing the issuance  of  the
bonds.  The  bonds  shall  be  secured  as  provided  in  the
authorizing  resolution, which may, notwithstanding any other
provision  of  this  Code,  include  a  specific  pledge   or
assignment of and lien on or security interest in the income,
interest  and dividends derived from investments of the board
and a specific  pledge  or  assignment  of  and  lien  on  or
security   interest   in  any  funds,  reserves  or  accounts
established or provided for by the resolution  of  the  board
authorizing the issuance of the bonds. The bonds or refunding
bonds  shall  not  be  payable  from any employer or employee
contributions   derived   from   State   appropriations   nor
constitute  obligations  or  indebtedness  of  the  State  of
Illinois or  of  any  municipal  corporation  or  other  body
politic and corporate in the State.
    The  holder  or  holders of any bonds issued by the board
may bring suits at law or proceedings in equity to compel the
performance and observance by the board or any of its  agents
or  employees  of  any  contract  or  covenant  made with the
holders of the bonds, to compel  the  board  or  any  of  its
agents  or  employees  to  perform  any duties required to be
performed for the benefit of the holders of the bonds by  the
provisions  of the resolution authorizing their issuance, and
to enjoin the board or any of its agents  or  employees  from
taking  any  action  in  conflict  with  any such contract or
covenant.
    Notwithstanding the provisions of Section 15-188 of  this
Code, if the board fails to pay the principal of, premium, if
any,  or  interest  on any of the bonds as they become due, a
civil action to compel  payment  may  be  instituted  in  the
appropriate  circuit  court  by  the holder or holders of the
bonds upon which such default exists or by a  trustee  acting
on behalf of the holders.
    No bonds may be issued under this Section until a copy of
the resolution of the board authorizing such bonds, certified
by  the  secretary  of  the  board,  has  been filed with the
Governor of the State of Illinois.
    "Bonds" means any instrument evidencing the obligation to
pay  money,  including  without  limitation   bonds,   notes,
installment  or  financing  contracts,  leases, certificates,
warrants, and any other evidences of indebtedness.
    "Project" means the acquisition, construction, equipping,
improving, expanding and furnishing of  any  office  building
for  the  use  of  the  system,  including any real estate or
interest in real estate necessary  or  useful  in  connection
therewith.
    "Cost  of  any project" includes all capital costs of the
project, an amount for  expenses  of  issuing  any  bonds  to
finance  such  project,  including underwriter's discount and
costs of bond  insurance  or  other  credit  enhancement,  an
amount  necessary  to  provide  for  a  reserve  fund for the
payment of the principal of and interest on such bonds and an
amount to pay interest on such bonds  for  a  period  not  to
exceed  the  greater  of  2 years or a period ending 6 months
after the estimated date of completion of the project.
(Source: P.A. 86-1034.)

    (40 ILCS 5/15-168.1 new)
    Sec. 15-168.1.  Testimony and the production of  records.
The  secretary  of  the  Board  shall have the power to issue
subpoenas to compel  the  attendance  of  witnesses  and  the
production   of   documents   and   records,   including  law
enforcement records maintained by law  enforcement  agencies,
in conjunction with a disability claim, administrative review
proceedings, or felony forfeiture investigation.  The fees of
witnesses  for attendance and travel shall be the same as the
fees of witnesses before the circuit courts of this State and
shall be paid by the party seeking the subpoena.   The  Board
may  apply  to  any  circuit  court in the State for an order
requiring  compliance  with  a  subpoena  issued  under  this
Section.   Subpoenas  issued  under  this  Section  shall  be
subject  to  applicable  provisions  of  the  Code  of  Civil
Procedure.

    (40 ILCS 5/15-185) (from Ch. 108 1/2, par. 15-185)
    Sec. 15-185.  Annuities,  etc.  Exempt.  The  accumulated
employee  and  employer  contributions shall be held in trust
for each participant and annuitant, and this trust  shall  be
treated  as  a  spendthrift trust. Except as provided in this
Article, all cash, securities  and  other  property  of  this
system,  all  annuities and other benefits payable under this
Article and  all  accumulated  credits  of  participants  and
annuitants  in  this  system  and  the right of any person to
receive an annuity or other benefit under this Article, or  a
refund  of  contributions,  shall not be subject to judgment,
execution,  garnishment,  attachment,  or  other  seizure  by
process, in bankruptcy or otherwise,  nor  to  sale,  pledge,
mortgage  or  other  alienation, and shall not be assignable.
The board, however, may deduct from the benefits, refunds and
credits payable to the participant, annuitant or beneficiary,
amounts owed  by the participant or annuitant to the  system.
No  attempted  sale,  transfer  or assignment of any benefit,
refund or credit shall prevent the right of the board to make
the deduction and offset  authorized  in  this  Section.  Any
participant  or  annuitant  may authorize the board to deduct
from disability benefits or annuities, premiums due under any
group hospital-surgical insurance program which is  sponsored
or  approved  by  any  employer; however, the deductions from
disability benefits may not begin prior to 6 months after the
disability occurs.
    A  person  receiving  an  annuity  or  benefit  may  also
authorize withholding from such annuity or  benefit  for  the
purposes   enumerated   in   the  State  Salary  and  Annuity
Withholding Act.
    This  amendatory  Act  of  1989  is  a  clarification  of
existing law and shall be applicable to every participant and
annuitant without regard to whether  status  as  an  employee
terminates  before  the effective date of this amendatory Act
of 1989.
(Source: P.A. 86-273; 86-1488.)

    (40 ILCS 5/15-190) (from Ch. 108 1/2, par. 15-190)
    Sec. 15-190.  Persons under legal disability. If a person
is under legal disability when any right or privilege accrues
to him or her under this Article, a guardian may be appointed
pursuant to law, and may, on behalf of such person, claim and
exercise any such right or privilege with the same force  and
effect as if the person had not been under a legal disability
and had claimed or exercised such right or privilege.
    If  a  person's application for benefits or a physician's
certificate on file with the board shows that the  person  is
under  a legal disability, and no guardian has been appointed
for his or  her  estate,  the  benefits  payable  under  this
Article  may  be  paid (1) directly to the person under legal
disability, or (2) to either parent of the person under legal
disability or any adult person with  whom  the  person  under
legal  disability  may  at  the time be living, provided only
that such parent or adult person to whom any amount is to  be
paid shall have advised the board in writing that such amount
will  be  held  or  used  for the benefit of the person under
legal disability, or (3) to the trustee of any trust  created
for  the  sole  benefit  of the person under legal disability
while that person is living, provided only that  the  trustee
of  such  trust  to  whom any amount is to be paid shall have
advised the board in writing that such amount will be held or
used for the benefit of the person  under  legal  disability.
The system shall not be required to determine the validity of
the trust or any of the terms thereof.  The representation of
the  trustee  that  the  trust meets the requirements of this
Section shall be conclusive as to the  system.   The  written
receipt  of  the  person  under legal disability or the other
person  who  receives  such  payment  shall  be  an  absolute
discharge of the system's liability in respect of the  amount
so paid.
(Source: P.A. 86-1488.)

    (40 ILCS 5/15-191) (from Ch. 108 1/2, par. 15-191)
    Sec.  15-191.   Payment  of  benefits  to  minors. If any
benefits under this Article become payable to  a  minor,  the
board  may make payment (1) directly to the minor, (2) to any
person who has legally qualified and is acting as guardian of
the minor's person or property in any jurisdiction, or (3) to
either parent of the minor or to any adult person  with  whom
the  minor  may at the time be living, provided only that the
parent or other person to whom any amount is to be paid shall
have advised the board in writing that such  amount  will  be
held  or  used  for  the  benefit of the minor, or (4) to the
trustee of any trust created for  the  sole  benefit  of  the
minor  while  that  minor  is  living, provided only that the
trustee of such trust to whom any amount is to be paid  shall
have  advised  the  board in writing that such amount will be
held or used for the benefit of the minor.  The system  shall
not be required to determine the validity of the trust or any
of the terms thereof.  The representation of the trustee that
the  trust  meets  the  requirements of this Section shall be
conclusive as to the  system.  The  written  receipt  of  the
minor,  parent,  trustee,  or  other person who receives such
payment shall  be  an  absolute  discharge  of  the  system's
liability in respect of the amount so paid.
(Source: P.A. 83-1440.)

    Section  15.   The  Illinois  Pension  Code is amended by
changing Sections 14-103.12, 14-108, 14-431, 15-134,  15-135,
and 15-136 as follows:

    (40 ILCS 5/14-103.12) (from Ch. 108 1/2, par. 14-103.12)
    Sec. 14-103.12.  Final average compensation.
    (a)  For   retirement   and  survivor  annuities,  "final
average compensation" means the monthly compensation obtained
by dividing the total compensation of an employee during  the
period  of:  (1)  the 48 consecutive months of service within
the  last  120  months  of  service  in   which   the   total
compensation  was  the  highest,  or  (2) the total period of
service, if less than 48 months, by the number of  months  of
service  in  such  period;  provided  that  for purposes of a
retirement annuity the average compensation for the  last  12
months  of  the  48-month  period  shall not exceed the final
average compensation by more than 25%.
    (b)  For death and disability benefits, in the case of  a
full-time  employee,  "final  average compensation" means the
greater of (1) the rate of compensation of  the  employee  at
the  date  of death or disability multiplied by 1 in the case
of a salaried employee, by 174  in  the  case  of  an  hourly
employee,  and  by  22 in the case of a per diem employee, or
(2) for benefits commencing on  or  after  January  1,  1991,
final  average  compensation  as  determined under subsection
(a).
    For purposes of this paragraph, full or part-time  status
shall  be  certified  by the employing agency.  Final rate of
compensation for a part-time  employee  shall  be  the  total
compensation earned during the last full calendar month prior
to the date of death or disability.
    (c)  Notwithstanding  the  provisions  of subsection (a),
for  the  purpose  of  calculating  retirement  and  survivor
annuities of persons with  at  least  20  years  of  eligible
creditable  service  as  defined  in  Section  14-110 a State
policeman, "final average  compensation"  means  the  monthly
rate  of  compensation received by the person on the last day
of eligible creditable service (but not to exceed 115% of the
average monthly compensation received by the person  for  the
last  24  months of service, unless the person was in service
as a State  policeman  before  the  effective  date  of  this
amendatory  Act of 1997), or the average monthly compensation
received by the person for the  last  48  months  of  service
prior to retirement, whichever is greater.
    (d)  Notwithstanding  the  provisions  of subsection (a),
for a person who was receiving, on the date of retirement  or
death,  a  disability  benefit  calculated  under subdivision
(b)(2) of this Section, the final average  compensation  used
to  calculate the disability benefit may be used for purposes
of calculating the retirement and survivor annuities.
    (e)  In computing the final average compensation, periods
of military leave shall not be considered.
    (f)  The changes to this Section made by this  amendatory
Act  of  1997  (redefining  final  average  compensation  for
members  under  the alternative formula) apply to members who
retire on or after January 1, 1998, without regard to whether
employment terminated  before  the  effective  date  of  this
amendatory Act of 1997.
(Source: P.A. 86-273; 86-1488.)

    (40 ILCS 5/14-108) (from Ch. 108 1/2, par. 14-108)
    (Text of Section before amendment by P.A. 89-507)
    Sec.  14-108. Amount of retirement annuity.  A member who
has contributed to the System for at least 12  months,  shall
be  entitled  to  a  prior  service  annuity for each year of
certified prior service credited to him, except that a member
shall receive 1/3 of the prior service annuity for each  year
of  service for which contributions have been made and all of
such annuity shall be  payable  after  the  member  has  made
contributions for a period of 3 years.  Proportionate amounts
shall  be  payable for service of less than a full year after
completion of at least 12 months.
    The  total  period  of  service  to  be   considered   in
establishing  the  measure  of  prior  service  annuity shall
include service credited in the Teachers'  Retirement  System
of   the   State  of  Illinois  and  the  State  Universities
Retirement System for which contributions have been  made  by
the  member to such systems; provided that at least 1 year of
the total period of 3 years prescribed for the allowance of a
full measure  of  prior  service  annuity  shall  consist  of
membership  service  in this System for which credit has been
granted.
    (a)  In the case of a member  who  retires  on  or  after
January  1, 1998 and is a noncovered employee, the retirement
annuity for membership service and  prior  service  shall  be
2.2%  1.67%  of  final  average  compensation for each of the
first 10 years of service; 1.90% for  each  of  the  next  10
years of service; 2.10% for each year of service in excess of
20 but not exceeding 30; and 2.30% for each year in excess of
30.   Any  service  credit  established as a covered employee
shall be considered in determining the applicable percentages
and computed as stated in paragraph (b).
    (b)  In the case of a member  who  retires  on  or  after
January  1,  1998  and  is a covered employee, the retirement
annuity for membership service and  prior  service  shall  be
computed  as  stated  in paragraph (a) for all service credit
established as a  noncovered  employee;  for  service  credit
established  as a covered employee it shall be 1.67% of final
average compensation 1% for each of the  first  10  years  of
service;  1.10%  for  each  of  the next 10 years of service;
1.30% for each year of  service  in  excess  of  20  but  not
exceeding 30; and 1.50% for each year of service in excess of
30.   Any service credit established as a noncovered employee
shall   be   considered   in   determining   the   applicable
percentages.
    (c)  For a member with 30  but  less  than  35  years  of
creditable service retiring after attaining age 55 but before
age  60, the retirement annuity shall be reduced by 1/2 of 1%
for each month that the member's age is under age 60  at  the
time of retirement.
    (d)  A  retirement  annuity shall not exceed 75% of final
average compensation, subject to such extension as may result
from the application of Section 14-114 or Section 14-115.
    (e)  The  retirement  annuity  payable  to  any   covered
employee  who  is  a  member  of the System and in service on
January 1, 1969, or in service thereafter in 1969 as a result
of legislation  enacted  by  the  Illinois  General  Assembly
transferring  the  member  to  State  employment  from county
employment in a county Department of Public Aid  in  counties
of 3,000,000 or more population, under a plan of coordination
with   the  Old  Age,  Survivors  and  Disability  provisions
thereof, if not fully insured for Old Age Insurance  payments
under the Federal Old Age, Survivors and Disability Insurance
provisions at the date of acceptance of a retirement annuity,
shall  not be less than the amount for which the member would
have been eligible if coordination were not applicable.
    (f)  The  retirement  annuity  payable  to  any   covered
employee  who  is  a  member  of the System and in service on
January 1, 1969, or in service thereafter in 1969 as a result
of the legislation designated in  the  immediately  preceding
paragraph,  if  fully  insured for Old Age Insurance payments
under  the  federal  Social  Security  Act  at  the  date  of
acceptance of a retirement annuity, shall not be less than an
amount which when added  to  the  Primary  Insurance  Benefit
payable  to  the  member upon attainment of age 65 under such
federal Act, will equal the annuity which would otherwise  be
payable   if  the  coordinated  plan  of  coverage  were  not
applicable.
    (g)  In  the  case  of  a  member  who  is  a  noncovered
employee, the retirement annuity for membership service as  a
full-time  security employee of the Department of Corrections
or security employee of the Department of Mental  Health  and
Developmental  Disabilities  shall  be  1.9% of final average
compensation for each of the first 10 years of service;  2.1%
for each of the next 10 years of service; 2.25% for each year
of service in excess of 20 but not exceeding 30; and 2.5% for
each  year  in  excess  of 30; except that the annuity may be
calculated under subsection (a) rather than  this  subsection
(g) if the resulting annuity is greater.
    (h)  In  the  case of a member who is a covered employee,
the retirement annuity for membership service as a  full-time
security   employee  of  the  Department  of  Corrections  or
security employee of the  Department  of  Mental  Health  and
Developmental  Disabilities  shall  be 1.67% of final average
compensation for each of the first 10 years of service; 1.90%
for each of the next 10 years of service; 2.10% for each year
of service in excess of 20 but not exceeding  30;  and  2.30%
for each year in excess of 30.
    (i)  For  the purposes of this Section and Section 14-133
of this Act, the term "security employee of the Department of
Corrections"  and  the  term  "security   employee   of   the
Department  of  Mental Health and Developmental Disabilities"
shall have the meanings ascribed to them in subsection (c) of
Section 14-110.
    (j)  The  retirement   annuity   computed   pursuant   to
paragraphs  (g)  or  (h)  shall  be  applicable only to those
security employees  of  the  Department  of  Corrections  and
security  employees  of  the  Department of Mental Health and
Developmental Disabilities who have  at  least  20  years  of
membership   service   and  who  are  not  eligible  for  the
alternative retirement annuity provided under Section 14-110.
However, persons transferring to this  System  under  Section
14-108.2  who  have  service  credit under Article 16 of this
Code  may  count  such  service  toward  establishing   their
eligibility  under  the  20-year  service requirement of this
subsection;  but  such  service  may   be   used   only   for
establishing  such  eligibility,  and  not for the purpose of
increasing or calculating any benefit.
    (k)  (Blank). In the case of a member who has at least 10
years  of  creditable  service  as  a  court  reporter,   the
retirement  annuity  for service as a court reporter shall be
2.2% of final average compensation  for  each  year  of  such
service  as  a noncovered employee, and 1.5% of final average
compensation for each year  of  such  service  as  a  covered
employee.
    (l)  The  changes to this Section made by this amendatory
Act of 1997 (changing  certain  retirement  annuity  formulas
from  a  stepped  rate  to  a flat rate) apply to members who
retire on or after January 1, 1998, without regard to whether
employment terminated  before  the  effective  date  of  this
amendatory  Act  of 1997.  An annuity shall not be calculated
in steps by using the new flat rate for some  steps  and  the
superseded  stepped  rate for other steps of the same type of
service.
(Source: P.A. 86-272; 86-273; 86-1028.)

    (Text of Section after amendment by P.A. 89-507)
    Sec. 14-108.  Amount of retirement annuity.  A member who
has contributed to the System for at least 12  months,  shall
be  entitled  to  a  prior  service  annuity for each year of
certified prior service credited to him, except that a member
shall receive 1/3 of the prior service annuity for each  year
of  service for which contributions have been made and all of
such annuity shall be  payable  after  the  member  has  made
contributions for a period of 3 years.  Proportionate amounts
shall  be  payable for service of less than a full year after
completion of at least 12 months.
    The  total  period  of  service  to  be   considered   in
establishing  the  measure  of  prior  service  annuity shall
include service credited in the Teachers'  Retirement  System
of   the   State  of  Illinois  and  the  State  Universities
Retirement System for which contributions have been  made  by
the  member to such systems; provided that at least 1 year of
the total period of 3 years prescribed for the allowance of a
full measure  of  prior  service  annuity  shall  consist  of
membership  service  in this system for which credit has been
granted.
    (a)  In the case of a member  who  retires  on  or  after
January  1, 1998 and is a noncovered employee, the retirement
annuity for membership service and  prior  service  shall  be
2.2%  1.67%  of  final  average  compensation for each of the
first 10 years of service; 1.90% for  each  of  the  next  10
ears  of service; 2.10% for each year of service in excess of
20 but not exceeding 30; and 2.30% for each year in excess of
30.  Any service credit established  as  a  covered  employee
shall be considered in determining the applicable percentages
and computed as stated in paragraph (b).
    (b)  In  the  case  of  a  member who retires on or after
January 1, 1998 and is a  covered  employee,  the  retirement
annuity  for  membership  service  and prior service shall be
computed as stated in paragraph (a) for  all  service  credit
established  as  a  noncovered  employee;  for service credit
established as a covered employee it shall be 1.67% of  final
average  compensation  1%  for  each of the first 10 years of
service; 1.10% for each of the  next  10  years  of  service;
1.30%  for  each  year  of  service  in  excess of 20 but not
exceeding 30; and 1.50% for each year of service in excess of
30.  Any service credit established as a noncovered  employee
shall   be   considered   in   determining   the   applicable
percentages.
    (c)  For  a  member  with  30  but  less than 35 years of
creditable service retiring after attaining age 55 but before
age 60, the retirement annuity shall be reduced by 1/2 of  1%
for  each  month that the member's age is under age 60 at the
time of retirement.
    (d)  A retirement annuity shall not exceed 75%  of  final
average compensation, subject to such extension as may result
from the application of Section 14-114 or Section 14-115.
    (e)  The   retirement  annuity  payable  to  any  covered
employee who is a member of the  System  and  in  service  on
January 1, 1969, or in service thereafter in 1969 as a result
of  legislation  enacted  by  the  Illinois  General Assembly
transferring the  member  to  State  employment  from  county
employment  in  a county Department of Public Aid in counties
of 3,000,000 or more population, under a plan of coordination
with  the  Old  Age,  Survivors  and  Disability   provisions
thereof,  if not fully insured for Old Age Insurance payments
under the Federal Old Age, Survivors and Disability Insurance
provisions at the date of acceptance of a retirement annuity,
shall not be less than the amount for which the member  would
have been eligible if coordination were not applicable.
    (f)  The   retirement  annuity  payable  to  any  covered
employee who is a member of the  System  and  in  service  on
January 1, 1969, or in service thereafter in 1969 as a result
of  the  legislation  designated in the immediately preceding
paragraph, if fully insured for Old  Age  Insurance  payments
under  the  Federal  Social  Security  Act  at  the  date  of
acceptance of a retirement annuity, shall not be less than an
amount  which  when  added  to  the Primary Insurance Benefit
payable to the member upon attainment of age  65  under  such
Federal  Act, will equal the annuity which would otherwise be
payable  if  the  coordinated  plan  of  coverage  were   not
applicable.
    (g)  In  the  case  of  a  member  who  is  a  noncovered
employee,  the retirement annuity for membership service as a
full-time security employee of the Department of  Corrections
or  security  employee  of  the  Department of Human Services
shall be 1.9% of final average compensation for each  of  the
first 10 years of service; 2.1% for each of the next 10 years
of  service;  2.25%  for each year of service in excess of 20
but not exceeding 30; and 2.5% for each year in excess of 30;
except that the annuity may be  calculated  under  subsection
(a)  rather than this subsection (g) if the resulting annuity
is greater.
    (h)  In the case of a member who is a  covered  employee,
the  retirement annuity for membership service as a full-time
security  employee  of  the  Department  of  Corrections   or
security  employee  of the Department of Human Services shall
be 1.67% of final average compensation for each of the  first
10  years  of service; 1.90% for each of the next 10 years of
service; 2.10% for each year of service in excess of  20  but
not exceeding 30; and 2.30% for each year in excess of 30.
    (i)  For  the purposes of this Section and Section 14-133
of this Act, the term "security employee of the Department of
Corrections"  and  the  term  "security   employee   of   the
Department   of  Human  Services"  shall  have  the  meanings
ascribed to them in subsection (c) of Section 14-110.
    (j)  The  retirement   annuity   computed   pursuant   to
paragraphs  (g)  or  (h)  shall  be  applicable only to those
security employees  of  the  Department  of  Corrections  and
security  employees  of  the Department of Human Services who
have at least 20 years of membership service and who are  not
eligible  for  the  alternative  retirement  annuity provided
under Section 14-110.  However, persons transferring to  this
System  under  Section 14-108.2 who have service credit under
Article 16  of  this  Code  may  count  such  service  toward
establishing  their  eligibility  under  the  20-year service
requirement of this subsection; but such service may be  used
only  for  establishing  such  eligibility,  and  not for the
purpose of increasing or calculating any benefit.
    (k)  (Blank). In the case of a member who has at least 10
years  of  creditable  service  as  a  court  reporter,   the
retirement  annuity  for service as a court reporter shall be
2.2% of final average compensation  for  each  year  of  such
service  as  a noncovered employee, and 1.5% of final average
compensation for each year  of  such  service  as  a  covered
employee.
    (l)  The  changes to this Section made by this amendatory
Act of 1997 (changing  certain  retirement  annuity  formulas
from  a  stepped  rate  to  a flat rate) apply to members who
retire on or after January 1, 1998, without regard to whether
employment terminated  before  the  effective  date  of  this
amendatory  Act  of 1997.  An annuity shall not be calculated
in steps by using the new flat rate for some  steps  and  the
superseded  stepped  rate for other steps of the same type of
service.
(Source: P.A. 89-507, eff. 7-1-97.)

    (40 ILCS 5/14-131) (from Ch. 108 1/2, par. 14-131)
    Sec. 14-131. Contributions by State.
    (a)  The State shall make contributions to the System  by
appropriations of amounts which, together with other employer
contributions  from trust, federal, and other funds, employee
contributions, investment income, and other income,  will  be
sufficient  to meet the cost of maintaining and administering
the System on a 90% funded basis in accordance with actuarial
recommendations.
    For the purposes of this Section and  Section  14-135.08,
references  to  State  contributions  refer  only to employer
contributions and do not include employee contributions  that
are  picked up or otherwise paid by the State or a department
on behalf of the employee.
    (b)  The Board shall determine the total amount of  State
contributions  required  for each fiscal year on the basis of
the actuarial tables and other  assumptions  adopted  by  the
Board, using the formula in subsection (e).
    The  Board shall also determine a State contribution rate
for each fiscal year, expressed as a percentage  of  payroll,
based  on  the  total  required  State  contribution for that
fiscal year (less the amount  received  by  the  System  from
appropriations  under  Section  8.12 of the State Finance Act
and  Section  1  of  the  State  Pension   Funds   Continuing
Appropriation  Act, if any, for the fiscal year ending on the
June 30 immediately  preceding  the  applicable  November  15
certification deadline), the estimated payroll (including all
forms  of  compensation)  for  personal  services rendered by
eligible employees, and the recommendations of the actuary.
    For the purposes of this Section and Section 14.1 of  the
State  Finance  Act,  the  term "eligible employees" includes
employees who participate in  the  System,  persons  who  may
elect  to  participate in the System but have not so elected,
persons who are serving a qualifying period that is  required
for participation, and annuitants employed by a department as
described in subdivision (a)(1) or (a)(2) of Section 14-111.
    (c)  Contributions   shall   be   made   by  the  several
departments for each pay period  by  warrants  drawn  by  the
State   Comptroller   against   their   respective  funds  or
appropriations based upon vouchers stating the amount  to  be
so  contributed.   These  amounts  shall be based on the full
rate certified by the Board under Section 14-135.08 for  that
fiscal year.
    (d)  If  an  employee is paid from trust funds or federal
funds, the department or other employer  shall  pay  employer
contributions from those funds to the System at the certified
rate,  unless  the  terms  of  the trust or the federal-State
agreement preclude the use of the funds for that purpose,  in
which  case the required employer contributions shall be paid
by the State.
    (e)  For  State  fiscal  years  2011  through  2045,  the
minimum contribution to the System to be made  by  the  State
for  each  fiscal  year  shall be an amount determined by the
System to be sufficient to bring  the  total  assets  of  the
System  up  to  90% of the total actuarial liabilities of the
System by the end of State fiscal year 2045.  In making these
determinations, the  required  State  contribution  shall  be
calculated  each  year  as a level percentage of payroll over
the years remaining to and including  fiscal  year  2045  and
shall be determined under the projected unit credit actuarial
cost method.
    For  State  fiscal  years  1996  through  2010, the State
contribution to the System, as a percentage of the applicable
employee  payroll,  shall  be  increased  in   equal   annual
increments  so  that  by State fiscal year 2011, the State is
contributing at the rate required under this Section;  except
that (i) for State fiscal year 1998, for all purposes of this
Code   and  any  other  law  of  this  State,  the  certified
percentage of the applicable employee payroll shall be 5.052%
for  employees  earning  eligible  creditable  service  under
Section  14-110  and  6.500%   for   all   other   employees,
notwithstanding any contrary certification made under Section
14-135.08 before the effective date of this amendatory Act of
1997, and (ii) in the following specified State fiscal years,
the  State  contribution to the System shall not be less than
the  following  indicated  percentages  of   the   applicable
employee  payroll,  even  if  the  indicated  percentage will
produce  a  State  contribution  in  excess  of  the   amount
otherwise  required under this subsection and subsection (a):
9.8% in FY 1999; 10.0% in FY 2000; 10.2% in FY 2001; 10.4% in
FY 2002; 10.6% in FY 2003; 10.8% in  FY  2004;  11.0%  in  FY
2005;  11.2%  in FY 2006; 11.4% in FY 2007; 11.6% in FY 2008;
and 11.8% in FY 2009.
    Beginning in State fiscal year 2046,  the  minimum  State
contribution  for each fiscal year shall be the amount needed
to maintain the total assets of the  System  at  90%  of  the
total actuarial liabilities of the System.
(Source: P.A. 88-593, eff. 8-22-94; 89-136, eff. 7-14-95.)

    (40 ILCS 5/15-134) (from Ch. 108 1/2, par. 15-134)
    Sec. 15-134.  Participant.
    (a)  Each  person  shall,  as  a condition of employment,
become a participant and be subject to this  Article  on  the
date that he or she becomes an employee.
    An  employee  who becomes a participant shall continue to
be a participant until he or she becomes an  annuitant,  dies
or  accepts  a  refund of contributions, except that a person
shall not be deemed a participant while participating  in  an
optional  program  for  part-time  workers  established under
Section 15-158.1 or participating in an optional program  for
employees established under Section 15-158.2.
    (b)  A   person   employed  concurrently  by  2  or  more
employers  is  eligible  to  participate  in  the  system  on
compensation received from all employers; however, his or her
combined basic compensation and combined earnings  shall  not
exceed  the  basic compensation and earnings which would have
been payable for full-time employment by the  employer  under
which  the  employee's  basic  compensation  is  the highest.
However, effective for all employment on  or  after  July  1,
1991,  where  a  person  is employed to render service to one
employer during an academic or summer term and is employed by
another  employer  to  render  service  to  it   during   the
succeeding,  nonoverlapping  academic  or  summer  term, then
exclusively for the purposes  of  this  Section,  the  person
shall  be considered to be successively employed by more than
one employer, rather than concurrently employed by 2 or  more
employers.
(Source: P.A. 89-430, eff. 12-15-95.)

    (40 ILCS 5/15-135) (from Ch. 108 1/2, par. 15-135)
    Sec. 15-135.  Retirement annuities - Conditions.
    (a)  A  participant  who  retires in one of the following
specified years with the specified amount of 35 or more years
of service is entitled to a retirement annuity at any age:
         35 years if retirement is in 1997 or before;
         34 years if retirement is in 1998;
         33 years if retirement is in 1999;
         32 years if retirement is in 2000;
         31 years if retirement is in 2001;
         30 years if retirement is in 2002;
         35 years if retirement is in 2003 or later.
    A participant with 8  or  more  years  of  service  after
September  1, 1941, is entitled to a retirement annuity on or
after attainment of age 55.
    A participant with at least 5 but less than  8  years  of
service  after September 1, 1941, is entitled to a retirement
annuity on or after attainment of age 62.
    A participant who has at least 25  years  of  service  in
this system as a police officer or firefighter is entitled to
a retirement annuity on or after the attainment of age 50, if
Rule 4 of Section 15-136 is applicable to the participant.
    (b)  The  annuity  payment period shall begin on the date
specified   by   the   participant   submitting   a   written
application, which date shall not be prior to termination  of
employment  or  more  than one year before the application is
received by the board; however, if the participant is not  an
employee  on  April 1 following the attainment of age 70 1/2,
the annuity payment period shall begin on that date.
    (c)  An annuity is not payable  if  the  amount  provided
under Section 15-136 is less than $10 per month.
(Source: P.A. 86-273.)

    (40 ILCS 5/15-136) (from Ch. 108 1/2, par. 15-136)
    Sec. 15-136.  Retirement annuities - Amount.
    (a)  The  amount  of  the  retirement  annuity  shall  be
determined  by whichever of the following rules is applicable
and provides the largest annuity:
    Rule 1:  The retirement annuity shall be 1.67%  of  final
rate  of  earnings for each of the first 10 years of service,
1.90% for each of the next 10 years  of  service,  2.10%  for
each  year  of  service in excess of 20 but not exceeding 30,
and 2.30% for each year in excess of 30; or for  persons  who
retire on or after January 1, 1998, 2.2% of the final rate of
earnings for each year of service.
    Rule  2:  The  retirement annuity shall be the sum of the
following,  determined   from   amounts   credited   to   the
participant  in  accordance with the actuarial tables and the
prescribed rate  of  interest  in  effect  at  the  time  the
retirement annuity begins:
         (i)  The  normal annuity which can be provided on an
    actuarially   actuarial   equivalent   basis,   by    the
    accumulated  normal  contributions  as  of  the  date the
    annuity begins; and
         (ii)  an annuity from employer contributions  of  an
    amount which can be provided on an actuarially equivalent
    basis  from  the accumulated normal contributions made by
    the  participant  under  Section  15-113.6  and   Section
    15-113.7  plus  1.4  times  all  other accumulated normal
    contributions made by the participant.
    Rule 3:  The retirement annuity of a participant  who  is
employed  at  least  one-half time during the period on which
his or her final rate of earnings is based, shall be equal to
the  participant's  years  of  service  not  to  exceed   30,
multiplied  by  (1)  $96  if  the participant's final rate of
earnings is less than $3,500, (2) $108 if the final  rate  of
earnings is at least $3,500 but less than $4,500, (3) $120 if
the  final  rate of earnings is at least $4,500 but less than
$5,500, (4) $132 if the final rate of earnings  is  at  least
$5,500  but  less  than $6,500, (5) $144 if the final rate of
earnings is at least $6,500 but less than $7,500, (6) $156 if
the final rate of earnings is at least $7,500 but  less  than
$8,500,  (7)  $168  if the final rate of earnings is at least
$8,500 but less than $9,500, and (8) $180 if the  final  rate
of earnings is $9,500 or more.
    Rule  4:  A participant who is at least age 50 and has 25
or more years of service as a police officer or  firefighter,
and  a  participant who is age 55 or over and has at least 20
but less than 25 years of service  as  a  police  officer  or
firefighter,  shall  be  entitled  to a retirement annuity of
2 1/4% of the final rate of earnings for each of the first 10
years of service as a police officer or  firefighter,  2 1/2%
for  each of the next 10 years of service as a police officer
or firefighter, and 2 3/4% for each  year  of  service  as  a
police   officer   or  firefighter  in  excess  of  20.   The
retirement annuity for all other service  shall  be  computed
under Rule 1.
    (b)  The  retirement annuity provided under Rules 1 and 3
above shall be reduced by  1/2  of  1%  for  each  month  the
participant  is  under  age  60  at  the  time of retirement.
However, this reduction shall  not  apply  in  the  following
cases:
         (1)  For  a  disabled  participant  whose disability
    benefits have been discontinued because  he  or  she  has
    exhausted   eligibility  for  disability  benefits  under
    clause (6) (5) of Section 15-152;
         (2)  For a participant who has at least  the  number
    of  35  years  of  service  required to retire at any age
    under subsection (a) of Section 15-135; or
         (3)  For that portion of a retirement annuity  which
    has   been   provided   on  account  of  service  of  the
    participant during periods when he or she  performed  the
    duties  of  a  police  officer  or  firefighter, if these
    duties were performed for at least  5  years  immediately
    preceding the date the retirement annuity is to begin.
    (c)  The  maximum retirement annuity provided under Rules
1, 2, and 4 shall be the lesser of (1) the  annual  limit  of
benefits  as specified in Section 415 of the Internal Revenue
Code of 1986, as such Section may be  amended  from  time  to
time  and  as  such  benefit  limits shall be adjusted by the
Commissioner of Internal Revenue, and (2) 80%  75%  of  final
rate  of  earnings;  however, this limitation of 75% of final
rate of earnings shall  not  apply  to  a  person  who  is  a
participant  or annuitant on September 15, 1977 if it results
in a retirement annuity less than that which  is  payable  to
the  annuitant  or  which  would  have  been  payable  to the
participant under the provisions of this Article in effect on
June 30, 1977.
    (d)  An annuitant whose status as an employee  terminates
after  August  14,  1969 shall receive automatic increases in
his or her retirement annuity as follows:
    Effective January 1 immediately following  the  date  the
retirement  annuity  begins,  the  annuitant shall receive an
increase in his or her monthly retirement annuity  of  0.125%
of the monthly retirement annuity provided under Rule 1, Rule
2,  Rule  3, or Rule 4, contained in this Section, multiplied
by the number of full months which elapsed from the date  the
retirement  annuity  payments  began to January 1, 1972, plus
0.1667% of such annuity, multiplied by  the  number  of  full
months  which  elapsed  from January 1, 1972, or the date the
retirement annuity payments began,  whichever  is  later,  to
January 1, 1978, plus 0.25% of such annuity multiplied by the
number  of full months which elapsed from January 1, 1978, or
the date the retirement annuity payments began, whichever  is
later, to the effective date of the increase.
    The  annuitant  shall  receive  an increase in his or her
monthly retirement  annuity  on  each  January  1  thereafter
during  the  annuitant's  life  of  3% of the monthly annuity
provided under Rule 1, Rule 2, Rule 3, or Rule 4 contained in
this Section.  The change made under this subsection by  P.A.
81-970  is  effective  January  1,  1980  and applies to each
annuitant whose status as an employee  terminates  before  or
after that date.
    Beginning January 1, 1990, all automatic annual increases
payable   under   this  Section  shall  be  calculated  as  a
percentage of the total annuity payable at the  time  of  the
increase,  including  all  increases previously granted under
this Article.      The change made in this subsection by P.A.
85-1008 is effective January  26,  1988,  and  is  applicable
without  regard  to  whether status as an employee terminated
before that date.
    (e)  If, on January 1, 1987, or the date  the  retirement
annuity payment period begins, whichever is later, the sum of
the  retirement  annuity  provided  under Rule 1 or Rule 2 of
this Section and  the  automatic  annual  increases  provided
under  the  preceding subsection or Section 15-136.1, amounts
to less than the retirement annuity which would  be  provided
by  Rule  3,  the retirement annuity shall be increased as of
January 1, 1987, or the date the retirement  annuity  payment
period  begins, whichever is later, to the amount which would
be provided by Rule 3 of this Section. Such increased  amount
shall  be considered as the retirement annuity in determining
benefits provided under other Sections of this Article.  This
paragraph applies without regard  to  whether  status  as  an
employee   terminated  before  the  effective  date  of  this
amendatory Act of  1987,  provided  that  the  annuitant  was
employed  at  least  one-half time during the period on which
the final rate of earnings was based.
    (f)  A participant is entitled to such additional annuity
as may be provided on an actuarial equivalent basis,  by  any
accumulated  additional  contributions  to his or her credit.
However, the additional contributions made by the participant
toward the automatic increases in annuity provided under this
Section shall not be taken into account  in  determining  the
amount of such additional annuity.
    (g)  If,  (1)  by law, a function of a governmental unit,
as defined by Section 20-107 of this Code, is transferred  in
whole  or  in  part  to  an  employer,  and (2) a participant
transfers employment from  such  governmental  unit  to  such
employer  within 6 months after the transfer of the function,
and (3) the sum of (A) the annuity payable to the participant
under Rule 1, 2, or 3 of this Section  (B)  all  proportional
annuities  payable to the participant by all other retirement
systems covered by Article 20, and (C)  the  initial  primary
insurance  amount  to which the participant is entitled under
the Social Security Act, is less than the retirement  annuity
which  would  have  been  payable if all of the participant's
pension credits  validated  under  Section  20-109  had  been
validated  under this system, a supplemental annuity equal to
the difference in  such  amounts  shall  be  payable  to  the
participant.
    (h)  On January 1, 1981, an annuitant who was receiving a
retirement  annuity  on  or before January 1, 1971 shall have
his or her retirement annuity then being  paid  increased  $1
per  month for each year of creditable service. On January 1,
1982, an annuitant  whose  retirement  annuity  began  on  or
before  January  1,  1977,  shall  have his or her retirement
annuity then being paid increased $1 per month for each  year
of creditable service.
    (i)  On  January  1, 1987, any annuitant whose retirement
annuity began on or before January 1, 1977,  shall  have  the
monthly retirement annuity increased by an amount equal to 8¢
per year of creditable service times the number of years that
have elapsed since the annuity began.
(Source: P.A. 86-272; 86-273; 86-1028; revised 5-17-96.)

    Section  95.   No  acceleration or delay.  Where this Act
makes changes in a statute that is represented in this Act by
text that is not yet or no longer in effect (for  example,  a
Section  represented  by  multiple versions), the use of that
text does not accelerate or delay the taking  effect  of  (i)
the  changes made by this Act or (ii) provisions derived from
any other Public Act.
    Section 99. Effective date.  This Act takes  effect  upon
becoming law.

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