97TH GENERAL ASSEMBLY
State of Illinois
2011 and 2012
HB3325

 

Introduced 2/24/2011, by Rep. Joseph M. Lyons

 

SYNOPSIS AS INTRODUCED:
 
40 ILCS 5/5-167.1  from Ch. 108 1/2, par. 5-167.1
40 ILCS 5/5-169.1 new
30 ILCS 805/8.35 new

    Amends the Chicago Police Article of the Illinois Pension Code. Provides that, for policemen born on or after January 1, 1955 but before January 1, 1960, beginning on January 1, 2012, automatic annual increases shall be 3% and such policemen shall not be subject to the 30% maximum increase. Increases employee contributions by 1% in exchange for that benefit enhancement. Makes changes concerning annual increases to the monthly annuities of persons who first become a policeman on or after the effective date of the amendatory Act and deletes repetitive language concerning annual increases in survivor's annuities for new hires. Amends the State Mandates Act to require implementation without reimbursement.


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FISCAL NOTE ACT MAY APPLY
PENSION IMPACT NOTE ACT MAY APPLY
STATE MANDATES ACT MAY REQUIRE REIMBURSEMENT

 

 

A BILL FOR

 

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1    AN ACT concerning public employee benefits.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Illinois Pension Code is amended by changing
5Section 5-167.1 and by adding Section 5-169.1 as follows:
 
6    (40 ILCS 5/5-167.1)  (from Ch. 108 1/2, par. 5-167.1)
7    Sec. 5-167.1. Automatic increase in annuity; retirement
8from service after September 1, 1967.
9    (a) A policeman who retires from service after September 1,
101967 with at least 20 years of service credit shall, upon
11either the first of the month following the first anniversary
12of his date of retirement if he is age 60 (age 55 if born before
13January 1, 1955) or over on that anniversary date, or upon the
14first of the month following his attainment of age 60 (age 55
15if born before January 1, 1955) if it occurs after the first
16anniversary of his retirement date, have his then fixed and
17payable monthly annuity increased by 1 1/2% and such first
18fixed annuity as granted at retirement increased by an
19additional 1 1/2% in January of each year thereafter up to a
20maximum increase of 30%. Beginning January 1, 1983 for
21policemen born before January 1, 1930, and beginning January 1,
221988 for policemen born on or after January 1, 1930 but before
23January 1, 1940, and beginning January 1, 1996 for policemen

 

 

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1born on or after January 1, 1940 but before January 1, 1945,
2and beginning January 1, 2000 for policemen born on or after
3January 1, 1945 but before January 1, 1950, and beginning
4January 1, 2005 for policemen born on or after January 1, 1950
5but before January 1, 1955, and beginning January 1, 2012 for
6policemen born on or after January 1, 1955, such increases
7shall be 3% and such policemen shall not be subject to the 30%
8maximum increase.
9    Any policeman born before January 1, 1945 who qualifies for
10a minimum annuity and retires after September 1, 1967 but has
11not received the initial increase under this subsection before
12January 1, 1996 is entitled to receive the initial increase
13under this subsection on (1) January 1, 1996, (2) the first
14anniversary of the date of retirement, or (3) attainment of age
1555, whichever occurs last. The changes to this Section made by
16Public Act 89-12 apply beginning January 1, 1996 and without
17regard to whether the policeman or annuitant terminated service
18before the effective date of that Act.
19    Any policeman born before January 1, 1950 who qualifies for
20a minimum annuity and retires after September 1, 1967 but has
21not received the initial increase under this subsection before
22January 1, 2000 is entitled to receive the initial increase
23under this subsection on (1) January 1, 2000, (2) the first
24anniversary of the date of retirement, or (3) attainment of age
2555, whichever occurs last. The changes to this Section made by
26this amendatory Act of the 92nd General Assembly apply without

 

 

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1regard to whether the policeman or annuitant terminated service
2before the effective date of this amendatory Act.
3    Any policeman born before January 1, 1955 who qualifies for
4a minimum annuity and retires after September 1, 1967 but has
5not received the initial increase under this subsection before
6January 1, 2005 is entitled to receive the initial increase
7under this subsection on (1) January 1, 2005, (2) the first
8anniversary of the date of retirement, or (3) attainment of age
955, whichever occurs last. The changes to this Section made by
10this amendatory Act of the 94th General Assembly apply without
11regard to whether the policeman or annuitant terminated service
12before the effective date of this amendatory Act.
13    Any policeman who qualifies for a minimum annuity and
14retires after September 1, 1967 but has not received the
15initial increase under this subsection before January 1, 2012
16is entitled to receive the initial increase under this
17subsection on (1) January 1, 2012, (2) the first anniversary of
18the date of retirement, or (3) attainment of age 55, whichever
19occurs last. The changes to this Section made by this
20amendatory Act of the 97th General Assembly apply without
21regard to whether the policeman or annuitant terminated service
22before the effective date of this amendatory Act.
23    (b) Subsection (a) of this Section is not applicable to an
24employee receiving a term annuity.
25    (c) To help defray the cost of such increases in annuity,
26there shall be deducted, beginning September 1, 1967, from each

 

 

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1payment of salary to a policeman, 1/2 of 1% of each salary
2payment concurrently with and in addition to the salary
3deductions otherwise made for annuity purposes.
4    The city, in addition to the contributions otherwise made
5by it for annuity purposes under other provisions of this
6Article, shall make matching contributions concurrently with
7such salary deductions.
8    Each such 1/2 of 1% deduction from salary and each such
9contribution by the city of 1/2 of 1% of salary shall be
10credited to the Automatic Increase Reserve, to be used to
11defray the cost of the 1 1/2% annuity increase provided by this
12Section. Any balance in such reserve as of the beginning of
13each calendar year shall be credited with interest at the rate
14of 3% per annum.
15    Such deductions from salary and city contributions shall
16continue while the policeman is in service.
17    The salary deductions provided in this Section are not
18subject to refund, except to the policeman himself, in any case
19in which a policeman withdraws prior to qualification for
20minimum annuity and applies for refund or applies for annuity,
21and also where a term annuity becomes payable. In such cases,
22the total of such salary deductions shall be refunded to the
23policeman, without interest, and charged to the Automatic
24Increase Reserve.
25    (d) Notwithstanding any other provision of this Article,
26the monthly annuity of a person who first becomes a policeman

 

 

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1under this Article on or after the effective date of this
2amendatory Act of the 97th General Assembly shall be increased
3on the January 1 occurring either on or after the attainment of
4age 60 or the first anniversary of the annuity start date,
5whichever is later. Each annual increase shall be calculated at
63% or one-half the annual unadjusted percentage increase (but
7not less than zero) in the consumer price index-u for the 12
8months ending with the September preceding each November 1,
9whichever is less, of the originally granted retirement
10annuity. If the annual unadjusted percentage change in the
11consumer price index-u for a 12-month period ending in
12September is zero or, when compared with the preceding period,
13decreases, then the annuity shall not be increased.
14Notwithstanding any other provision of this Article, for a
15person who first becomes a policeman under this Article on or
16after January 1, 2011, the annuity to which the survivor is
17entitled under this subsection (d) shall be in the amount of 66
182/3% of the policeman's earned annuity at the date of death.
19Nothing in this subsection (d) shall act to diminish the
20survivor's benefits described in this Section.
21    Notwithstanding any other provision of this Article, the
22monthly annuity of a survivor of a person who first becomes a
23policeman under this Article on or after January 1, 2011 shall
24be increased on the January 1 after attainment of age 60 by the
25recipient of the survivor's annuity and each January 1
26thereafter by 3% or one-half the annual unadjusted percentage

 

 

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1increase (but not less than zero) in the consumer price index-u
2for the 12 months ending with the September preceding each
3November 1, whichever is less, of the originally granted
4annuity. If the annual unadjusted percentage change in the
5consumer price index-u for a 12-month period ending in
6September is zero or, when compared with the preceding period,
7decreases, then the annuity shall not be increased.
8    For the purposes of this subsection (d), "consumer price
9index-u" means the index published by the Bureau of Labor
10Statistics of the United States Department of Labor that
11measures the average change in prices of goods and services
12purchased by all urban consumers, United States city average,
13all items, 1982-84 = 100. The new amount resulting from each
14annual adjustment shall be determined by the Public Pension
15Division of the Department of Insurance and made available to
16the boards of the pension funds.
17(Source: P.A. 96-1495, eff. 1-1-11.)
 
18    (40 ILCS 5/5-169.1 new)
19    Sec. 5-169.1. Contributions for expanding the 3% annual
20increases to plan participants born on or after January 1,
211955. Beginning January 1, 2012, an additional 1% of each
22payment of the salary of each present employee shall be
23deducted and contributed to the fund in exchange for extending
24the 3% annual increases under Section 5-167.1 to all plan
25participants born on or after January 1, 1955. The deductions

 

 

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1shall be made from each payment of salary and shall continue
2while the employee is in service.
 
3    Section 90. The State Mandates Act is amended by adding
4Section 8.35 as follows:
 
5    (30 ILCS 805/8.35 new)
6    Sec. 8.35. Exempt mandate. Notwithstanding Sections 6 and 8
7of this Act, no reimbursement by the State is required for the
8implementation of any mandate created by this amendatory Act of
9the 97th General Assembly.