Sen. John J. Cullerton

Filed: 5/8/2013

 

 


 

 


 
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1
AMENDMENT TO SENATE BILL 2404

2    AMENDMENT NO. ______. Amend Senate Bill 2404 by replacing
3everything after the enacting clause with the following:
 
4    "Section 5. The Illinois Public Labor Relations Act is
5amended by changing Section 4 as follows:
 
6    (5 ILCS 315/4)  (from Ch. 48, par. 1604)
7    Sec. 4. Management Rights. Employers shall not be required
8to bargain over matters of inherent managerial policy, which
9shall include such areas of discretion or policy as the
10functions of the employer, standards of services, its overall
11budget, the organizational structure and selection of new
12employees, examination techniques and direction of employees.
13Employers, however, shall be required to bargain collectively
14with regard to policy matters directly affecting wages, hours
15and terms and conditions of employment as well as the impact
16thereon upon request by employee representatives, but

 

 

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1excluding (i) the payment of the additional member
2contributions set forth in subsections (a-1) and (a-5) of
3Sections 14-133, 15-157, and 16-152 of the Illinois Pension
4Code and (ii) the provision of compensation or benefits to
5employees who make the election under Section 14-106.5,
615-132.9, or 16-122.9 of the Illinois Pension Code in order to
7offset all or part of any compensation or benefit limitations
8included as part of the elections under those Sections.
9    To preserve the rights of employers and exclusive
10representatives which have established collective bargaining
11relationships or negotiated collective bargaining agreements
12prior to the effective date of this Act, employers shall be
13required to bargain collectively with regard to any matter
14concerning wages, hours or conditions of employment about which
15they have bargained for and agreed to in a collective
16bargaining agreement prior to the effective date of this Act,
17but excluding (i) the payment of the additional member
18contributions set forth in subsections (a-1) and (a-5) of
19Sections 14-133, 15-157, and 16-152 of the Illinois Pension
20Code and (ii) the provision of compensation or benefits to
21employees who make the election under Section 14-106.5,
2215-132.9, or 16-122.9 of the Illinois Pension Code in order to
23offset all or part of any compensation or benefit limitations
24included as part of the elections under those Sections.
25    The chief judge of the judicial circuit that employs a
26public employee who is a court reporter, as defined in the

 

 

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1Court Reporters Act, has the authority to hire, appoint,
2promote, evaluate, discipline, and discharge court reporters
3within that judicial circuit.
4    Nothing in this amendatory Act of the 94th General Assembly
5shall be construed to intrude upon the judicial functions of
6any court. This amendatory Act of the 94th General Assembly
7applies only to nonjudicial administrative matters relating to
8the collective bargaining rights of court reporters.
9(Source: P.A. 94-98, eff. 7-1-05.)
 
10    Section 10. The State Employees Group Insurance Act of 1971
11is amended by changing Sections 6.9 and 6.10 and by adding
12Sections 6.10A and 6.16 as follows:
 
13    (5 ILCS 375/6.9)
14    Sec. 6.9. Health benefits for community college benefit
15recipients and community college dependent beneficiaries.
16    (a) Purpose. It is the purpose of this amendatory Act of
171997 to establish a uniform program of health benefits for
18community college benefit recipients and their dependent
19beneficiaries under the administration of the Department of
20Central Management Services.
21    (b) Creation of program. Beginning July 1, 1999, the
22Department of Central Management Services shall be responsible
23for administering a program of health benefits for community
24college benefit recipients and community college dependent

 

 

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1beneficiaries under this Section. The State Universities
2Retirement System and the boards of trustees of the various
3community college districts shall cooperate with the
4Department in this endeavor.
5    (c) Eligibility. All community college benefit recipients
6and community college dependent beneficiaries shall be
7eligible to participate in the program established under this
8Section, without any interruption or delay in coverage or
9limitation as to pre-existing medical conditions. Eligibility
10to participate shall be determined by the State Universities
11Retirement System. Eligibility information shall be
12communicated to the Department of Central Management Services
13in a format acceptable to the Department.
14    (d) Coverage. The health benefit coverage provided under
15this Section shall be a program of health, dental, and vision
16benefits.
17    The program of health benefits under this Section may
18include any or all of the benefit limitations, including but
19not limited to a reduction in benefits based on eligibility for
20federal medicare benefits, that are provided under subsection
21(a) of Section 6 of this Act for other health benefit programs
22under this Act.
23    (e) Insurance rates and premiums. The Director shall
24determine the insurance rates and premiums for community
25college benefit recipients and community college dependent
26beneficiaries. Rates and premiums may be based in part on age

 

 

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1and eligibility for federal Medicare coverage. The Director
2shall also determine premiums that will allow for the
3establishment of an actuarially sound reserve for this program.
4    The cost of health benefits under the program shall be paid
5as follows:
6        (1) For a community college benefit recipient, costs
7    shall be an amount equal to the difference between the
8    projected costs of health benefits under the program and
9    projected contributions from community college districts,
10    active contributors, and other income of the program. Other
11    income of the program shall exclude contributions made by
12    the State to retire unpaid claims of the program up to 75%
13    of the total insurance rate shall be paid from the
14    Community College Health Insurance Security Fund.
15        (2) The balance of the rate of insurance, including the
16    entire premium for any coverage for community college
17    dependent beneficiaries that has been elected, shall be
18    paid by deductions authorized by the community college
19    benefit recipient to be withheld from his or her monthly
20    annuity or benefit payment from the State Universities
21    Retirement System; except that (i) if the balance of the
22    cost of coverage exceeds the amount of the monthly annuity
23    or benefit payment, the difference shall be paid directly
24    to the State Universities Retirement System by the
25    community college benefit recipient, and (ii) all or part
26    of the balance of the cost of coverage may, at the option

 

 

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1    of the board of trustees of the community college district,
2    be paid to the State Universities Retirement System by the
3    board of the community college district from which the
4    community college benefit recipient retired. The State
5    Universities Retirement System shall promptly deposit all
6    moneys withheld by or paid to it under this subdivision
7    (e)(2) into the Community College Health Insurance
8    Security Fund. These moneys shall not be considered assets
9    of the State Universities Retirement System.
10    (f) Financing. All revenues arising from the
11administration of the health benefit program established under
12this Section shall be deposited into the Community College
13Health Insurance Security Fund, which is hereby created as a
14nonappropriated trust fund to be held outside the State
15Treasury, with the State Treasurer as custodian. Any interest
16earned on moneys in the Community College Health Insurance
17Security Fund shall be deposited into the Fund.
18    Moneys in the Community College Health Insurance Security
19Fund shall be used only to pay the costs of the health benefit
20program established under this Section, including associated
21administrative costs and the establishment of a program
22reserve. Beginning January 1, 1999, the Department of Central
23Management Services may make expenditures from the Community
24College Health Insurance Security Fund for those costs.
25    (g) Contract for benefits. The Director shall by contract,
26self-insurance, or otherwise make available the program of

 

 

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1health benefits for community college benefit recipients and
2their community college dependent beneficiaries that is
3provided for in this Section. The contract or other arrangement
4for the provision of these health benefits shall be on terms
5deemed by the Director to be in the best interest of the State
6of Illinois and the community college benefit recipients based
7on, but not limited to, such criteria as administrative cost,
8service capabilities of the carrier or other contractor, and
9the costs of the benefits.
10    (h) Continuation of program. It is the intention of the
11General Assembly that the program of health benefits provided
12under this Section be maintained on an ongoing, affordable
13basis. The program of health benefits provided under this
14Section may be amended by the State and is not intended to be a
15pension or retirement benefit subject to protection under
16Article XIII, Section 5 of the Illinois Constitution.
17    (i) Other health benefit plans. A health benefit plan
18provided by a community college district (other than a
19community college district subject to Article VII of the Public
20Community College Act) under the terms of a collective
21bargaining agreement in effect on or prior to the effective
22date of this amendatory Act of 1997 shall continue in force
23according to the terms of that agreement, unless otherwise
24mutually agreed by the parties to that agreement and the
25affected retiree. A community college benefit recipient or
26community college dependent beneficiary whose coverage under

 

 

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1such a plan expires shall be eligible to begin participating in
2the program established under this Section without any
3interruption or delay in coverage or limitation as to
4pre-existing medical conditions.
5    This Act does not prohibit any community college district
6from offering additional health benefits for its retirees or
7their dependents or survivors.
8(Source: P.A. 90-497, eff. 8-18-97; 90-655, eff. 7-30-98.)
 
9    (5 ILCS 375/6.10)
10    Sec. 6.10. Contributions to the Community College Health
11Insurance Security Fund.
12    (a) Beginning January 1, 1999, every active contributor of
13the State Universities Retirement System (established under
14Article 15 of the Illinois Pension Code) who (1) is a full-time
15employee of a community college district (other than a
16community college district subject to Article VII of the Public
17Community College Act) or an association of community college
18boards and (2) is not an employee as defined in Section 3 of
19this Act shall make contributions toward the cost of community
20college annuitant and survivor health benefits at the rate of
210.50% of salary. Beginning July 1, 2014, the contribution rate
22under this subsection (a) shall be 0.93% of salary.
23    These contributions shall be deducted by the employer and
24paid to the State Universities Retirement System as service
25agent for the Department of Central Management Services. The

 

 

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1System may use the same processes for collecting the
2contributions required by this subsection that it uses to
3collect the contributions received from those employees under
4Section 15-157 of the Illinois Pension Code. An employer may
5agree to pick up or pay the contributions required under this
6subsection on behalf of the employee; such contributions shall
7be deemed to have been paid by the employee.
8    The State Universities Retirement System shall promptly
9deposit all moneys collected under this subsection (a) into the
10Community College Health Insurance Security Fund created in
11Section 6.9 of this Act. The moneys collected under this
12Section shall be used only for the purposes authorized in
13Section 6.9 of this Act and shall not be considered to be
14assets of the State Universities Retirement System.
15Contributions made under this Section are not transferable to
16other pension funds or retirement systems and are not
17refundable upon termination of service.
18    (b) Beginning January 1, 1999, every community college
19district (other than a community college district subject to
20Article VII of the Public Community College Act) or association
21of community college boards that is an employer under the State
22Universities Retirement System shall contribute toward the
23cost of the community college health benefits provided under
24Section 6.9 of this Act an amount equal to 0.50% of the salary
25paid to its full-time employees who participate in the State
26Universities Retirement System and are not members as defined

 

 

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1in Section 3 of this Act. Beginning July 1, 2014, the
2contribution rate under this subsection (b) shall be 0.93% of
3salary.
4    These contributions shall be paid by the employer to the
5State Universities Retirement System as service agent for the
6Department of Central Management Services. The System may use
7the same processes for collecting the contributions required by
8this subsection that it uses to collect the contributions
9received from those employers under Section 15-155 of the
10Illinois Pension Code.
11    The State Universities Retirement System shall promptly
12deposit all moneys collected under this subsection (b) into the
13Community College Health Insurance Security Fund created in
14Section 6.9 of this Act. The moneys collected under this
15Section shall be used only for the purposes authorized in
16Section 6.9 of this Act and shall not be considered to be
17assets of the State Universities Retirement System.
18Contributions made under this Section are not transferable to
19other pension funds or retirement systems and are not
20refundable upon termination of service.
21    The Department of Healthcare and Family Services, or any
22successor agency designated to procure healthcare contracts
23pursuant to this Act, is authorized to establish funds,
24separate accounts provided by any bank or banks as defined by
25the Illinois Banking Act, or separate accounts provided by any
26savings and loan association or associations as defined by the

 

 

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1Illinois Savings and Loan Act of 1985 to be held by the
2Director, outside the State treasury, for the purpose of
3receiving the transfer of moneys from the Community College
4Health Insurance Security Fund. The Department may promulgate
5rules further defining the methodology for the transfers. Any
6interest earned by moneys in the funds or accounts shall inure
7to the Community College Health Insurance Security Fund. The
8transferred moneys, and interest accrued thereon, shall be used
9exclusively for transfers to administrative service
10organizations or their financial institutions for payments of
11claims to claimants and providers under the self-insurance
12health plan. The transferred moneys, and interest accrued
13thereon, shall not be used for any other purpose including, but
14not limited to, reimbursement of administration fees due the
15administrative service organization pursuant to its contract
16or contracts with the Department.
17    (c) On or before November 15 of each year, the Board of
18Trustees of the State Universities Retirement System shall
19certify to the Governor, the Director of Central Management
20Services, and the State Comptroller its estimate of the total
21amount of contributions to be paid under subsection (a) of this
22Section for the next fiscal year. Beginning in fiscal year
232008, the amount certified shall be decreased or increased each
24year by the amount that the actual active employee
25contributions either fell short of or exceeded the estimate
26used by the Board in making the certification for the previous

 

 

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1fiscal year. The State Universities Retirement System shall
2calculate the amount of actual active employee contributions in
3fiscal years 1999 through 2005. Based upon this calculation,
4the fiscal year 2008 certification shall include an amount
5equal to the cumulative amount that the actual active employee
6contributions either fell short of or exceeded the estimate
7used by the Board in making the certification for those fiscal
8years. The certification shall include a detailed explanation
9of the methods and information that the Board relied upon in
10preparing its estimate. As soon as possible after the effective
11date of this Section, the Board shall submit its estimate for
12fiscal year 1999.
13    (d) Beginning in fiscal year 1999, on the first day of each
14month, or as soon thereafter as may be practical, the State
15Treasurer and the State Comptroller shall transfer from the
16General Revenue Fund to the Community College Health Insurance
17Security Fund 1/12 of the annual amount appropriated for that
18fiscal year to the State Comptroller for deposit into the
19Community College Health Insurance Security Fund under Section
201.4 of the State Pension Funds Continuing Appropriation Act.
21    (e) Except where otherwise specified in this Section, the
22definitions that apply to Article 15 of the Illinois Pension
23Code apply to this Section.
24(Source: P.A. 94-839, eff. 6-6-06; 95-632, eff. 9-25-07.)
 
25    (5 ILCS 375/6.10A new)

 

 

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1    Sec. 6.10A. City colleges; optional participation in
2program of health benefits. Notwithstanding any other
3provision of this Act, the Department of Central Management
4Services shall adopt rules authorizing optional participation
5in the program of health benefits for community college benefit
6recipients and community college dependent beneficiaries by
7any person who is otherwise ineligible to participate in that
8program solely as a result of that or another person's
9employment with a community college district subject to Article
10VII of the Public Community College Act.
 
11    (5 ILCS 375/6.16 new)
12    Sec. 6.16. Health benefit election for Tier I employees and
13Tier I retirees.
14    (a) For purposes of this Section:
15    "Eligible Tier I employee" means, except as provided in
16subsection (g) of this Section, an individual who makes or is
17deemed to have made an election under paragraph (1) of
18subsection (a) of Section 2-110.3, 14-106.5, 15-132.9, or
1916-122.9 of the Illinois Pension Code.
20    "Eligible Tier I retiree" means, except as provided in
21subsection (g) of this Section, an individual who makes or is
22deemed to have made an election under paragraph (1) of
23subsection (a-5) of Section 2-110.3, 14-106.5, 15-132.9, or
2416-122.9 of the Illinois Pension Code.
25    "Program of health benefits" means (i) a health plan, as

 

 

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1defined in subsection (o) of Section 3 of this Act, that is
2designed and contracted for by the Director under this Act or
3any successor Act or (ii) if administration of that health plan
4is transferred to a trust established by the State or an
5independent Board in order to provide health benefits to a
6class of a persons that includes eligible Tier I retirees, then
7the plan of health benefits provided through that trust.
8    (b) As adequate and legal consideration for making an
9election under paragraph (1) of subsection (a) or (a-5) of
10Section 2-110.3, 14-106.5, 15-132.9, or 16-122.9 of the
11Illinois Pension Code, as the case may be, each eligible Tier I
12employee and each eligible Tier I retiree shall receive a
13vested and enforceable contractual right to participate in a
14program of health benefits while he or she qualifies as an
15annuitant or retired employee. That right also extends to such
16a person's dependents and survivors who are eligible under the
17applicable program of health benefits.
18    (c) Notwithstanding subsection (b), eligible Tier I
19employees and eligible Tier I retirees may be required to make
20contributions toward the cost of coverage under a program of
21health benefits.
22    (d) The vested and enforceable contractual right to a
23program of health benefits is not offered as, and shall not be
24considered, a pension or retirement benefit under Article XIII,
25Section 5 of the Illinois Constitution, the Illinois Pension
26Code, or any subsequent or successor enactment providing

 

 

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1pension benefits.
2    (e) Notwithstanding any other provision of law, except
3subsection (g) of this Section, a Tier I employee or Tier I
4retiree who has made an election under paragraph (2) of
5subsection (a) or (a-5) of Section 2-110.3, 14-106.5, 15-132.9,
6or 16-122.9 of the Illinois Pension Code, as the case may be,
7shall not be entitled to participate in any program of health
8benefits under this Act as an annuitant or retired employee
9receiving a retirement annuity, regardless of any contrary
10election pursuant to any of those Sections under any other
11retirement system.
12    Notwithstanding any other provision of law, except
13subsection (g) of this Section, a Tier I employee who is not
14entitled to participate in the program of health benefits as an
15annuitant or retired employee receiving a retirement annuity,
16due to an election under paragraph (2) of subsection (a) or
17(a-5) of Section 2-110.3, 14-106.5, 15-132.9, or 16-122.9 of
18the Illinois Pension Code, as the case may be, shall not be
19required to make contributions toward the program of health
20benefits while he or she is an employee or active contributor.
21However, an active employee may be required to make
22contributions toward health benefits he or she receives during
23active service.
24    (f) The Department shall coordinate with each retirement
25system administering an election in accordance with this
26amendatory Act of the 98th General Assembly to provide

 

 

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1information concerning the impact of the election of health
2benefits. Each System shall include information prepared by the
3Department in the required election packet. The Department
4shall make information available to Tier I employees and Tier I
5retirees through video materials, group presentations,
6consultation by telephone or other electronic means, or any
7combination of these methods. The information in the election
8packet shall include a notice that states: "YOU ARE HEREBY
9ADVISED THAT THE PROGRAM OF HEALTH BENEFITS OFFERED IS FOR
10ACCESS TO A GROUP HEALTHCARE PLAN ADMINISTERED BY THE
11DEPARTMENT, AND YOU MAY BE REQUIRED TO PAY FOR THE FULL COST OF
12COVERAGE PROVIDED BY THE PLAN, INCLUDING ALL PREMIUM,
13DEDUCTIBLE, AND COPAY AMOUNTS."
14    (g) Nothing in this Section shall be construed as applying
15to a person who is eligible to make or who made the election
16under Section 15-135.1 of the Illinois Pension Code.
 
17    Section 15. The Governor's Office of Management and Budget
18Act is amended by changing Sections 7 and 8 as follows:
 
19    (20 ILCS 3005/7)  (from Ch. 127, par. 417)
20    Sec. 7. All statements and estimates of expenditures
21submitted to the Office in connection with the preparation of a
22State budget, and any other estimates of expenditures,
23supporting requests for appropriations, shall be formulated
24according to the various functions and activities for which the

 

 

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1respective department, office or institution of the State
2government (including the elective officers in the executive
3department and including the University of Illinois and the
4judicial department) is responsible. All such statements and
5estimates of expenditures relating to a particular function or
6activity shall be further formulated or subject to analysis in
7accordance with the following classification of objects:
8    (1) Personal services
9    (2) State contribution for employee group insurance
10    (3) Contractual services
11    (4) Travel
12    (5) Commodities
13    (6) Equipment
14    (7) Permanent improvements
15    (8) Land
16    (9) Electronic Data Processing
17    (10) Telecommunication services
18    (11) Operation of Automotive Equipment
19    (12) Contingencies
20    (13) Reserve
21    (14) Interest
22    (15) Awards and Grants
23    (16) Debt Retirement
24    (17) Non-cost Charges.
25    (18) State retirement contribution for annual normal cost
26    (19) State retirement contribution for unfunded accrued

 

 

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1liability.
2(Source: P.A. 93-25, eff. 6-20-03.)
 
3    (20 ILCS 3005/8)  (from Ch. 127, par. 418)
4    Sec. 8. When used in connection with a State budget or
5expenditure or estimate, items (1) through (16) in the
6classification of objects stated in Section 7 shall have the
7meanings ascribed to those items in Sections 14 through 24.7,
8respectively, of the State Finance Act. "An Act in relation to
9State finance", approved June 10, 1919, as amended.
10    When used in connection with a State budget or expenditure
11or estimate, items (18) and (19) in the classification of
12objects stated in Section 7 shall have the meanings ascribed to
13those items in Sections 24.12 and 24.13, respectively, of the
14State Finance Act.
15(Source: P.A. 82-325.)
 
16    Section 20. The State Finance Act is amended by changing
17Section 13 and by adding Sections 24.12 and 24.13 as follows:
 
18    (30 ILCS 105/13)  (from Ch. 127, par. 149)
19    Sec. 13. The objects and purposes for which appropriations
20are made are classified and standardized by items as follows:
21    (1) Personal services;
22    (2) State contribution for employee group insurance;
23    (3) Contractual services;

 

 

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1    (4) Travel;
2    (5) Commodities;
3    (6) Equipment;
4    (7) Permanent improvements;
5    (8) Land;
6    (9) Electronic Data Processing;
7    (10) Operation of automotive equipment;
8    (11) Telecommunications services;
9    (12) Contingencies;
10    (13) Reserve;
11    (14) Interest;
12    (15) Awards and Grants;
13    (16) Debt Retirement;
14    (17) Non-Cost Charges;
15    (18) State retirement contribution for annual normal cost;
16    (19) State retirement contribution for unfunded accrued
17liability;
18    (20) (18) Purchase Contract for Real Estate.
19    When an appropriation is made to an officer, department,
20institution, board, commission or other agency, or to a private
21association or corporation, in one or more of the items above
22specified, such appropriation shall be construed in accordance
23with the definitions and limitations specified in this Act,
24unless the appropriation act otherwise provides.
25    An appropriation for a purpose other than one specified and
26defined in this Act may be made only as an additional, separate

 

 

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1and distinct item, specifically stating the object and purpose
2thereof.
3(Source: P.A. 84-263; 84-264.)
 
4    (30 ILCS 105/24.12 new)
5    Sec. 24.12. "State retirement contribution for annual
6normal cost" defined. The term "State retirement contribution
7for annual normal cost" means the portion of the total required
8State contribution to a retirement system for a fiscal year
9that represents the State's portion of the System's projected
10normal cost for that fiscal year, as determined and certified
11by the board of trustees of the retirement system in
12conformance with the applicable provisions of the Illinois
13Pension Code.
 
14    (30 ILCS 105/24.13 new)
15    Sec. 24.13. "State retirement contribution for unfunded
16accrued liability" defined. The term "State retirement
17contribution for unfunded accrued liability" means the portion
18of the total required State contribution to a retirement system
19for a fiscal year that is not included in the State retirement
20contribution for annual normal cost.
 
21    Section 25. The Budget Stabilization Act is amended by
22changing Sections 20 and 25 as follows:
 

 

 

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1    (30 ILCS 122/20)
2    Sec. 20. Pension Stabilization Fund.
3    (a) The Pension Stabilization Fund is hereby created as a
4special fund in the State treasury. Moneys in the fund shall be
5used for the sole purpose of making payments to the designated
6retirement systems as provided in Section 25.
7    (b) For each fiscal year when the General Assembly's
8appropriations and transfers or diversions as required by law
9from general funds do not exceed 99% of the estimated general
10funds revenues pursuant to subsection (a) of Section 10, the
11Comptroller shall transfer from the General Revenue Fund as
12provided by this Section a total amount equal to 0.5% of the
13estimated general funds revenues to the Pension Stabilization
14Fund.
15    (c) For each fiscal year through Fiscal Year 2019 when the
16General Assembly's appropriations and transfers or diversions
17as required by law from general funds do not exceed 98% of the
18estimated general funds revenues pursuant to subsection (b) of
19Section 10, the Comptroller shall transfer from the General
20Revenue Fund as provided by this Section a total amount equal
21to 1.0% of the estimated general funds revenues to the Pension
22Stabilization Fund.
23    (c-5) In Fiscal Year 2020 and each fiscal year thereafter,
24the State Comptroller shall order transferred and the State
25Treasurer shall transfer the following amounts from the General
26Revenue Fund to the Pension Stabilization Fund:

 

 

09800SB2404sam002- 22 -LRB098 09018 EFG 45623 a

1    in Fiscal Year 2020, $1,123,333,372;
2    in Fiscal Year 2021, $1,084,470,872;
3    in Fiscal Year 2022, $1,048,083,372;
4    in Fiscal Year 2023, $1,014,170,872;
5    in Fiscal Year 2024, $957,733,372;
6    in Fiscal Year 2025, $905,683,372;
7    in Fiscal Year 2026, $882,458,372;
8    in Fiscal Year 2027, $861,783,372;
9    in Fiscal Year 2028, $818,658,372;
10    in Fiscal Year 2029, $779,358,372;
11    in Fiscal Year 2030, $718,883,372;
12    in Fiscal Year 2031, $663,508,372;
13    in Fiscal Year 2032, $638,233,372;
14    in Fiscal Year 2033, $641,783,372;
15    in Fiscal Year 2034, $1,797,883,372;
16    in Fiscal Year 2035, $1,797,883,372;
17    in Fiscal Year 2036, $1,797,883,372;
18    in Fiscal Year 2037, $1,797,883,372;
19    in Fiscal Year 2038, $1,797,883,372;
20    in Fiscal Year 2039, $1,797,883,372;
21    in Fiscal Year 2040, $1,797,883,372;
22    in Fiscal Year 2041, $1,797,883,372;
23    in Fiscal Year 2042, $1,797,883,372;
24    in Fiscal Year 2043, $1,797,883,372;
25    in Fiscal Year 2044, $1,797,883,372; and
26    in Fiscal Year 2045, $1,797,883,372.

 

 

09800SB2404sam002- 23 -LRB098 09018 EFG 45623 a

1    (c-10) The transfers made pursuant to subsection (c-5) of
2this Section shall continue until Fiscal Year 2045 or until
3each of the designated retirement systems, as defined in
4Section 25, has achieved a funding ratio of at least 90%,
5whichever occurs first.
6    (d) The Comptroller shall transfer 1/12 of the total amount
7to be transferred each fiscal year under this Section into the
8Pension Stabilization Fund on the first day of each month of
9that fiscal year or as soon thereafter as possible; except that
10the final transfer of the fiscal year shall be made as soon as
11practical after the August 31 following the end of the fiscal
12year.
13    Until Fiscal Year 2020, before Before the final transfer
14for a fiscal year is made, the Comptroller shall reconcile the
15estimated general funds revenues used in calculating the other
16transfers under this Section for that fiscal year with the
17actual general funds revenues for that fiscal year. The final
18transfer for the fiscal year shall be adjusted so that the
19total amount transferred under this Section for that fiscal
20year is equal to the percentage specified in subsection (b) or
21(c) of this Section, whichever is applicable, of the actual
22general funds revenues for that fiscal year. The actual general
23funds revenues for the fiscal year shall be calculated in a
24manner consistent with subsection (c) of Section 10 of this
25Act.
26(Source: P.A. 94-839, eff. 6-6-06.)
 

 

 

09800SB2404sam002- 24 -LRB098 09018 EFG 45623 a

1    (30 ILCS 122/25)
2    Sec. 25. Transfers from the Pension Stabilization Fund.
3    (a) As used in this Section, "designated retirement
4systems" means:
5        (1) the State Employees' Retirement System of
6    Illinois;
7        (2) the Teachers' Retirement System of the State of
8    Illinois;
9        (3) the State Universities Retirement System;
10        (4) the Judges Retirement System of Illinois; and
11        (5) the General Assembly Retirement System.
12    (b) As soon as may be practical after any money is
13deposited into the Pension Stabilization Fund, the State
14Comptroller shall apportion the deposited amount among the
15designated retirement systems and the State Comptroller and
16State Treasurer shall pay the apportioned amounts to the
17designated retirement systems. The amount deposited shall be
18apportioned among the designated retirement systems in
19proportion to their respective certified State contributions
20for the State fiscal year in which the payment is made to those
21systems in the same proportion as their respective portions of
22the total actuarial reserve deficiency of the designated
23retirement systems, as most recently determined by the
24Governor's Office of Management and Budget. Amounts received by
25a designated retirement system under this Section shall be used

 

 

09800SB2404sam002- 25 -LRB098 09018 EFG 45623 a

1for funding the unfunded liabilities of the retirement system.
2Payments under this Section are authorized by the continuing
3appropriation under Section 1.7 of the State Pension Funds
4Continuing Appropriation Act.
5    (c) At the request of the State Comptroller, the Governor's
6Office of Management and Budget shall determine the individual
7and total actuarial reserve deficiencies of the designated
8retirement systems. For this purpose, the Governor's Office of
9Management and Budget shall consider the latest available audit
10and actuarial reports of each of the retirement systems and the
11relevant reports and statistics of the Public Pension Division
12of the Department of Financial and Professional Regulation.
13    (d) Payments to the designated retirement systems under
14this Section shall be in addition to, and not in lieu of, any
15State contributions required under Section 2-124, 14-131,
1615-155, 16-158, or 18-131 of the Illinois Pension Code.
17    Payments to the designated retirement systems under this
18Section, transferred after the effective date of this
19amendatory Act of the 98th General Assembly, do not reduce and
20do not constitute payment of any portion of the required State
21contribution under Article 2, 14, 15, 16, or 18 of the Illinois
22Pension Code in that fiscal year. Such amounts shall not
23reduce, and shall not be included in the calculation of, the
24required State Contribution under Article 2, 14, 15, 16, or 18
25of the Illinois Pension Code in any future year, until the
26designated retirement system has received payment of

 

 

09800SB2404sam002- 26 -LRB098 09018 EFG 45623 a

1contributions pursuant to this Act.
2(Source: P.A. 94-839, eff. 6-6-06.)
 
3    Section 30. The Illinois Pension Code is amended by
4changing Sections 2-108, 2-119.1, 2-125, 2-126, 2-134, 2-162,
57-109, 14-103.10, 14-114, 14-132, 14-133, 14-135.08, 14-152.1,
615-106, 15-107, 15-111, 15-136, 15-156, 15-157, 15-163,
715-165, 15-198, 16-106, 16-121, 16-133, 16-133.1, 16-133.6,
816-136.1, 16-152, and 16-203 and by adding Sections 1-161,
91-162, 2-105.1, 2-105.2, 2-107.9, 2-110.3, 14-103.40,
1014-103.41, 14-103.42, 14-106.5, 15-108.1, 15-108.2, 15-112.1,
1115-132.9, 16-107.1, 16-107.2, 16-121.1, 16-122.9, 16-133.6,
12and 16-158.2 as follows:
 
13    (40 ILCS 5/1-161 new)
14    Sec. 1-161. Tier II Task Force.
15    (a) Definitions. As used in this Section:
16    "Tier II member" means a public employee who, on or after
17January 1, 2011, became a member or participant of a retirement
18system or pension fund established under this Code.
19    "Tier II Task Force" or "Task Force" means the Tier II Task
20Force created by this Section.
21    (b) The Tier II Task Force is hereby created. The Task
22Force shall be composed of 16 members, appointed as follows:
23        (1) Two members of the House of Representatives
24    appointed by the Speaker of the House, one of whom shall

 

 

09800SB2404sam002- 27 -LRB098 09018 EFG 45623 a

1    serve as co-chair;
2        (2) Two members of the House of Representatives
3    appointed by the Minority Leader of the House;
4        (3) Two members of the Senate appointed by the
5    President of the Senate, one of whom shall serve as
6    co-chair;
7        (4) Two members of the Senate appointed by the Minority
8    Leader of the Senate; and
9        (5) Eight members, appointed by the co-chairs of the
10    Task Force, who are Board members of the public employee
11    unions representing Tier II members, no more than two of
12    which may be appointed from any individual public employee
13    union.
14    (c) The Task Force shall have the following
15responsibilities:
16        (1) to examine the impact of Public Acts 96-889 and
17    96-1495 on the retirement security of Tier II members;
18        (2) to study the impact of Public Acts 96-889 and
19    96-1495 on the ability of retirements systems and pension
20    funds established under this Code to maintain qualified
21    plan status under the federal Internal Revenue Code and
22    other applicable laws;
23        (3) to examine the impact of the changes made by Public
24    Acts 96-889 and 96-1495 on the ability of public employers
25    to attract and retain highly qualified employees and
26    provide sufficient retirement security; and

 

 

09800SB2404sam002- 28 -LRB098 09018 EFG 45623 a

1        (4) to make any recommendations regarding changes to
2    the pension benefits provided to Tier II employees the Task
3    Force deems necessary or advisable in order to:
4            (A) enhance the retirement security of Tier II
5        members;
6            (B) ensure that the various pension systems
7        maintain their status as qualified plans under the
8        federal Internal Revenue Code and other applicable
9        laws; and
10            (C) ensure that public employers in this State are
11        able to attract and retain highly qualified employees
12        and provide sufficient retirement security.
13    (d) The Commission on Governmental Forecasting and
14Accountability shall provide administrative support to the
15Task Force.
16    (e) The Task Force shall conduct a minimum of 4 public
17hearings, with hearings in Springfield, Chicago, and at least
18two other locations in Illinois as determined by the Task
19Force.
20    (f) The Task Force shall issue its report to the General
21Assembly no later than February 1, 2014.
22    (g) This Section is repealed on January 1, 2015.
 
23    (40 ILCS 5/1-162 new)
24    Sec. 1-162. Optional cash balance plan.
25    (a) Participation and Applicability. Beginning 12 months

 

 

09800SB2404sam002- 29 -LRB098 09018 EFG 45623 a

1after the effective date of this Section, any Tier I employee
2who has made the election under item (i) of paragraph (1) of
3subsection (a) of Section 14-106.5, 15-132.9, or 16-122.9 may
4elect to participate in the optional cash balance plan created
5under this Section.
6    The Board of Trustees of the applicable retirement system
7shall promulgate rules to establish a one-time irrevocable
8election period wherein a person eligible to participate in the
9optional cash balance plan may elect to participate.
10    (b) Title. The package of benefits provided under this
11Section may be referred to as the "optional cash balance plan".
12Persons subject to the provisions of this Section may be
13referred to as "participants in the optional cash balance
14plan".
15    (b-5) Definitions. As used in this Section:
16    "Account" means the notional cash balance account
17established under this Section for a participant in the
18optional cash balance plan.
19    "Salary" means "compensation" as defined in Article 14,
20"earnings" as defined in Article 15, and "salary" as defined in
21Article 16, whichever is applicable, without regard to the
22limitation in subsection (b-5) of Section 1-160.
23    "Tier I employee" means a person who is a Tier I employee
24under the applicable Article of this Code.
25    (c) Cash Balance Account. A notional cash balance account
26shall be established by the applicable retirement system for

 

 

09800SB2404sam002- 30 -LRB098 09018 EFG 45623 a

1each participant in the optional cash balance plan. The account
2is notional and does not contain any actual money segregated
3from the commingled assets of the retirement system. The cash
4balance in the account is to be used in calculating benefits as
5provided in this Section, but is not to be used in the
6calculation of any refund, transfer, or other benefit under the
7applicable Article of this Code.
8    The amounts to be credited to the cash balance account
9shall consist of (i) amounts contributed by or on behalf of the
10participant as employee contributions, (ii) notional employer
11contributions, and (iii) interest credit that is attributable
12to the account, all as provided in this Section.
13    Whenever necessary for the prompt calculation or
14administration, or when the System lacks information necessary
15to the calculation or administration otherwise required of or
16for a benefit under this Section, the applicable retirement
17system may estimate an amount to be credited to or debited from
18a participant's cash balance account and then adjust the amount
19so credited or debited when more accurate information becomes
20available.
21    The applicable retirement system shall give to each
22participant in the optional cash balance plan who has not yet
23retired annual notice of (1) the balance in the participant's
24cash balance account and (2) an estimate of the retirement
25annuity that will be payable to the participant if he or she
26retires at age 59 1/2.

 

 

09800SB2404sam002- 31 -LRB098 09018 EFG 45623 a

1    (d) Employee Contributions. In addition to the other
2contributions required under the applicable Article, each
3participant shall make contributions to the applicable
4retirement system at the rate of 2% of each payment of salary.
5The amount of each contribution shall be credited to the
6participant's cash balance account upon receipt and after the
7retirement system's reconciliation of the contribution.
8    (e) Optional Employer Contributions. Employers may make
9optional additional contributions to the applicable retirement
10system on behalf of their employees who are participants in the
11optional cash balance plan in accordance with procedures
12prescribed by the retirement system, to the extent permitted by
13federal law and the rules prescribed by the retirement system.
14The optional additional contributions under this subsection
15are actual monetary contributions to the retirement system, and
16the amount of each optional additional contribution shall be
17credited to the participant's cash balance account upon receipt
18and after the retirement system's reconciliation of the
19contribution.
20    (f) Interest Credit. An amount representing earnings on
21investments shall be determined by the retirement system in
22accordance with this Section and credited to the participant's
23cash balance account for each fiscal year in which there is a
24positive balance in that account; except that no additional
25interest credit shall be credited while an annuity based on the
26account is being paid. The interest credit amount shall be a

 

 

09800SB2404sam002- 32 -LRB098 09018 EFG 45623 a

1percentage of the average quarterly balance in the cash balance
2account during that fiscal year, and shall be calculated on
3June 30.
4    The percentage shall be the assumed treasury rate for the
5previous fiscal year, unless neither the retirement system's
6actual rate of investment earnings for the previous fiscal year
7nor the retirement system's actual rate of investment earnings
8for the five-year period ending at the end of the previous
9fiscal year is less than the assumed treasury rate.
10    If both the retirement system's actual rate of investment
11earnings for the previous fiscal year and the actual rate of
12investment earnings for the five-year period ending at the end
13of the previous fiscal year are at least the assumed treasury
14rate, then the percentage shall be:
15        (i) the assumed treasury rate, plus
16        (ii) two-thirds of the amount of the actual rate of
17    investment earnings for the previous fiscal year that
18    exceeds the assumed treasury rate.
19However, in no event shall the percentage applied under this
20subsection exceed 10%.
21    For the purposes of this subsection only, "previous fiscal
22year" means fiscal year ending one year before the interest
23rate is calculated.
24    For the purposes of this subsection only, "assumed treasury
25rate" means the average annual yield of the 30-year U.S.
26Treasury Bond over the previous fiscal year, but not less than

 

 

09800SB2404sam002- 33 -LRB098 09018 EFG 45623 a

14%.
2    When a person applies for a benefit under this Section, the
3retirement system shall apply an interest credit based on a
4proration of an estimate of what the interest credit will be
5for the relevant year. When the retirement system certifies the
6credit on June 30, it shall adjust the benefit accordingly.
7    (f-10) Distribution upon Termination of Employment. Upon
8termination of active employment with at least 5 years of
9service credit under the applicable retirement system and prior
10to making application for an annuity under this Section, a
11participant in the optional cash balance plan may make an
12irrevocable election to distribute an amount not to exceed 40%
13of the balance in the participant's account in the form of a
14direct rollover to another qualified plan, to the extent
15allowed by federal law. If the participant makes such an
16election, then the amount distributed shall be debited from the
17participant's cash balance account. A participant in the
18optional cash balance plan shall be allowed only one
19distribution under this subsection. The remaining balance in
20the participant's account shall be used for the determination
21of other benefits provided under this Section.
22    (f-15) Refund. In lieu of receiving a distribution under
23subsection (f-10), at any time after terminating active
24employment under the applicable retirement system, but before
25receiving a retirement annuity under this Section, a
26participant in the optional cash balance plan may elect to

 

 

09800SB2404sam002- 34 -LRB098 09018 EFG 45623 a

1receive a refund under this subsection. The refund shall
2consist of an amount equal to the amount of all employee
3contributions credited to the participant's account, but shall
4not include any interest credit or employer contributions. If
5the participant so requests, the refund may be paid in the form
6of a direct rollover to another qualified plan, to the extent
7allowed by federal law and in accordance with the rules of the
8applicable retirement system. Upon payment of the refund, the
9participant's notional cash balance account shall be closed.
10    (g) Retirement Annuity. A participant in the optional cash
11balance plan may begin collecting a retirement annuity at age
1259 1/2, but no earlier than the date of termination of active
13employment under the applicable retirement system.
14    The amount of the retirement annuity shall be calculated by
15the retirement system, based on the balance in the cash balance
16account, the assumption of future investment returns as
17specified in this subsection, the participant's election to
18have a lifetime survivor's annuity as specified in this
19subsection, the annual increase in retirement annuity as
20specified in subsection (h), the annual increase in survivor's
21annuity as specified in subsection (l), and any actuarial
22assumptions and tables adopted by the board of the retirement
23system for this purpose. The calculation shall determine the
24amount of retirement annuity, on an actuarially equivalent
25basis, that shall be designed to result in the balance in the
26participant's account arriving at zero on the date when the

 

 

09800SB2404sam002- 35 -LRB098 09018 EFG 45623 a

1last payment of the retirement annuity (or survivor's annuity,
2if the participant elects to provide for a survivor's annuity
3pursuant to this subsection) is anticipated to be paid under
4the relevant actuarial assumptions. A retirement annuity or a
5survivor's annuity provided under this Section shall be a life
6annuity and shall not expire if the account balance equals
7zero.
8    The annuity payment shall begin on the date specified by
9the participant submitting a written application, which date
10shall not be prior to termination of employment or more than
11one year before the application is received by the board;
12however, if the participant is not an employee of an employer
13participating in this System or in a participating system as
14defined in Article 20 of this Code on April 1 of the calendar
15year next following the calendar year in which the participant
16attains age 70 1/2, the annuity payment period shall begin on
17that date regardless of whether an application has been filed.
18    The participant may elect, under the participant's written
19application for retirement, to receive a reduced annuity
20payable for his or her life and to have a lifetime survivor's
21annuity in a monthly amount equal to 50%, 75%, or 100% of that
22reduced monthly amount, to be paid after the participant's
23death to his or her eligible survivor. Eligibility for a
24survivor's annuity shall be determined under the applicable
25Article of this Code.
26    For the purpose of calculating retirement annuities,

 

 

09800SB2404sam002- 36 -LRB098 09018 EFG 45623 a

1future investment returns shall be assumed to be a percentage
2equal to the average yield of the 30-year U.S. Treasury Bond
3over the 5 fiscal years prior to the calculation of the initial
4retirement annuity, plus 250 basis points; but not less than 4%
5nor more than 8%.
6    (h) Annual Increase in Retirement Annuity. The retirement
7annuity shall be subject to an automatic annual increase in an
8amount equal to 3% of the originally granted annuity on each
9January 1 occurring on or after the first anniversary of the
10annuity start date.
11    (i) Disability Benefits. There are no disability benefits
12provided under the optional cash balance plan, and no amounts
13for disability shall be deducted from the account of a
14participant in the optional cash balance plan. The disability
15benefits provided under the applicable retirement system apply
16to participants in the optional cash balance plan.
17    (j) Return to Service. Upon a return to service under the
18same retirement system after beginning to receive a retirement
19annuity under the optional cash balance plan, the retirement
20annuity shall be suspended and active participation in the
21optional cash balance plan shall resume. Upon termination of
22the employment, the retirement annuity shall resume in an
23amount to be recalculated in accordance with subsection (g),
24taking into effect the changes in the cash balance account. If
25a retired annuitant returns to service, his or her notional
26cash balance account shall be decreased by each payment of

 

 

09800SB2404sam002- 37 -LRB098 09018 EFG 45623 a

1retirement annuity prior to the return to service.
2    (k) Survivor's Annuity - Death before Retirement. In the
3case of a participant in the optional cash balance plan who had
4less than 5 years of service under the applicable Article and
5had not begun receiving a retirement annuity, the eligible
6survivor shall be entitled only to a refund of employee
7contributions under subsection (f-15).
8    In the case of a participant in the optional cash balance
9plan who had at least 5 years of service under the applicable
10Article and had not begun receiving a retirement annuity, the
11eligible survivor shall be entitled to receive a survivor's
12annuity beginning at age 59 1/2 upon written application. The
13survivor's annuity shall be calculated in the same manner as a
14retirement annuity under subsection (g). At any time before
15receiving a survivor's annuity, the eligible survivor may claim
16a distribution under subsection (f-10) or a refund under
17subsection (f-15). The deceased participant's account shall
18continue to receive interest credit until the eligible survivor
19begins to receive a survivor's annuity or receives a refund of
20employee contributions under subsection (f-15).
21    Eligibility for a survivor's annuity shall be determined
22under the applicable Article of this Code. A child's or
23parent's annuity for an otherwise eligible child or dependent
24parent shall be in the same amount, if any, prescribed under
25the applicable Article.
26    (l) Annual Increase in Survivor's Annuity. A survivor's

 

 

09800SB2404sam002- 38 -LRB098 09018 EFG 45623 a

1annuity granted under subsection (g) or (k) shall be subject to
2an automatic annual increase in an amount equal to 3% of the
3originally granted annuity on each January 1 occurring on or
4after the first anniversary of the annuity start date.
5    (m) Applicability of Provisions. The following provisions,
6if and as they exist in this Code, do not apply to participants
7in the optional cash balance plan with respect to participation
8in the optional cash balance plan, except as they are
9specifically provided for in this Section:
10        (1) minimum service or vesting requirements (other
11    than as provided in this Section);
12        (2) provisions limiting a retirement annuity to a
13    specified percentage of salary;
14        (3) provisions authorizing a minimum retirement or
15    survivor's annuity or a supplemental annuity;
16        (4) provisions authorizing any form of retirement
17    annuity or survivor's annuity not authorized under this
18    Section;
19        (5) provisions authorizing a reversionary annuity
20    (other than the survivor's annuity under subsection (g));
21        (6) provisions authorizing a refund of employee
22    contributions upon termination of service (other than upon
23    the death of the participant without an eligible survivor)
24    or any lump-sum payout in lieu of a retirement or
25    survivor's annuity (other than the distribution under
26    subsection (f-10) or the refund under subsection (f-15) of

 

 

09800SB2404sam002- 39 -LRB098 09018 EFG 45623 a

1    this Section;
2        (7) provisions authorizing optional service credits or
3    the payment of optional additional contributions (other
4    than the optional employer contributions specifically
5    authorized in this Section); or
6        (8) a level income option.
7    The Retirement Systems Reciprocal Act (Article 20 of this
8Code) does not apply to participation in the optional cash
9balance plan and does not affect the calculation of benefits
10payable under this Section.
11    The other provisions of this Code continue to apply to
12participants in the optional cash balance plan, to the extent
13that they do not conflict with this Section. In the case of a
14conflict between the provisions of this Section and any other
15provision of this Code, the provisions of this Section control.
16    (n) Rules. The Board of Trustees of the applicable
17retirement system may adopt rules and procedures for the
18implementation of this Section, including but not limited to
19determinations of how to integrate the administration of this
20Section with the requirements of the applicable Article and any
21other applicable provisions of this Code.
22    (o) Actual Employer Contributions. Payment of employer
23contributions with respect to participants in the optional cash
24balance plan shall be the responsibility of the actual
25employer. Optional additional contributions by employers may
26be paid in any amount, but must be paid in the manner specified

 

 

09800SB2404sam002- 40 -LRB098 09018 EFG 45623 a

1by the applicable retirement system.
2    (p) Prospective Modification. The provisions set forth in
3this Section are subject to prospective changes made by law
4provided that any such changes shall not apply to any benefits
5accrued under this Section prior to the effective date of any
6amendatory Act of the General Assembly.
7    (q) Qualified Plan Status. No provision of this Section
8shall be interpreted in a way that would cause the applicable
9retirement system to cease to be a qualified plan under Section
10401(a) of the Internal Revenue Code of 1986.
 
11    (40 ILCS 5/2-105.1 new)
12    Sec. 2-105.1. Tier I employee. "Tier I employee": A
13participant who first became a participant before January 1,
142011.
 
15    (40 ILCS 5/2-105.2 new)
16    Sec. 2-105.2. Tier I retiree. "Tier I retiree" means a
17former Tier I employee who is receiving a retirement annuity.
 
18    (40 ILCS 5/2-107.9 new)
19    Sec. 2-107.9. Future increase in income. "Future increase
20in income": Any increase in income in any form offered for
21service as a member under this Article after June 30, 2014 that
22would qualify as "salary", as defined in Section 2-108, but for
23the fact that the increase in income was offered to the member

 

 

09800SB2404sam002- 41 -LRB098 09018 EFG 45623 a

1on the condition that it not qualify as salary and was accepted
2by the member subject to that condition.
 
3    (40 ILCS 5/2-108)  (from Ch. 108 1/2, par. 2-108)
4    Sec. 2-108. Salary. "Salary": (1) For members of the
5General Assembly, the total compensation paid to the member by
6the State for one year of service, including the additional
7amounts, if any, paid to the member as an officer pursuant to
8Section 1 of "An Act in relation to the compensation and
9emoluments of the members of the General Assembly", approved
10December 6, 1907, as now or hereafter amended.
11    (2) For the State executive officers specified in Section
122-105, the total compensation paid to the member for one year
13of service.
14    (3) For members of the System who are participants under
15Section 2-117.1, or who are serving as Clerk or Assistant Clerk
16of the House of Representatives or Secretary or Assistant
17Secretary of the Senate, the total compensation paid to the
18member for one year of service, but not to exceed the salary of
19the highest salaried officer of the General Assembly.
20    However, in the event that federal law results in any
21participant receiving imputed income based on the value of
22group term life insurance provided by the State, such imputed
23income shall not be included in salary for the purposes of this
24Article.
25    Notwithstanding any other provision of this Section,

 

 

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1"salary" does not include any future increase in income that is
2offered for service as a member under this Article pursuant to
3the requirements of subsection (c) of Section 2-110.3 and
4accepted by a Tier I employee, or a Tier I retiree returning to
5active service, who has made the election under paragraph (2)
6of subsection (a) or (a-5) of Section 2-110.3.
7(Source: P.A. 86-27; 86-273; 86-1028; 86-1488.)
 
8    (40 ILCS 5/2-110.3 new)
9    Sec. 2-110.3. Election by Tier I employees and Tier I
10retirees.
11    (a) Each Tier I employee shall make an irrevocable election
12either:
13        (1) to agree to item (i) or (ii) as set forth in this
14    paragraph (1):
15            (i) to have the amount of the automatic annual
16        increases in his or her retirement annuity that are
17        otherwise provided for in this Article calculated,
18        instead, as provided in subsection (a-1) of Section
19        2-119.1, and to waive his or her eligibility for 2
20        automatic annual increases in retirement annuity as
21        provided in subsection (a-2) of Section 2-119.1; or
22            (ii) to waive his or her eligibility for 3
23        automatic annual increases in retirement annuity, as
24        provided in subsection (a-3) of Section 2-119.1, and to
25        make the contributions set forth in subsection (a-5) of

 

 

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1        Section 2-126; or
2        (2) to not agree to item (i) or (ii) as set forth in
3    paragraph (1) of this subsection.
4    The election required under this subsection (a) shall be
5made by each Tier I employee no earlier than February 1, 2014
6and no later than May 31, 2014, except that:
7        (i) a person who becomes a Tier I employee under this
8    Article on or after February 1, 2014 must make the election
9    under this subsection (a) within 60 days after becoming a
10    Tier I employee;
11        (ii) a person who returns to active service as a Tier I
12    employee under this Article on or after February 1, 2014
13    and has not yet made an election under this Section must
14    make the election under this subsection (a) within 60 days
15    after returning to active service as a Tier I employee; and
16        (iii) a person who made the election under subsection
17    (a-5) as a Tier I retiree remains bound by that election
18    and shall not make a later election under this subsection
19    (a).
20    If a Tier I employee fails for any reason to make a
21required election under this subsection within the time
22specified, then the employee shall be deemed to have made the
23election under paragraph (2) of this subsection.
24    (a-5) Each Tier I retiree shall make an irrevocable
25election either:
26        (1) to agree to the following:

 

 

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1            (i) to have the amount of the automatic annual
2        increases in his or her retirement annuity calculated
3        without regard to subsection (a-1), (a-2), or (a-3) of
4        Section 2-119.1; and
5            (ii) to waive his or her eligibility for 2
6        automatic annual increases in retirement annuity as
7        provided in subsection (a-4) of Section 2-119.1; or
8        (2) to not agree to items (i) and (ii) as set forth in
9    paragraph (1) of this subsection.
10    The election required under this subsection (a-5) shall be
11made by each Tier I retiree no earlier than February 1, 2014
12and no later than May 31, 2014, except that:
13        (i) a person who becomes a Tier I retiree under this
14    Article on or after February 1, 2014 must make the election
15    under this subsection (a-5) within 60 days after becoming a
16    Tier I retiree; and
17        (ii) a person who made the election under subsection
18    (a) as a Tier I employee remains bound by that election and
19    shall not make a later election under this subsection
20    (a-5).
21    If a Tier I retiree fails for any reason to make a required
22election under this subsection within the time specified, then
23the Tier I retiree shall be deemed to have made the election
24under paragraph (2) of this subsection.
25    (a-10) All elections under subsection (a) or (a-5) that are
26made or deemed to be made before June 1, 2014 shall take effect

 

 

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1on July 1, 2014. Elections that are made or deemed to be made
2on or after June 1, 2014 shall take effect on the first day of
3the month following the month in which the election is made or
4deemed to be made.
5    (b) As adequate and legal consideration provided under this
6amendatory Act of the 98th General Assembly for making an
7election under paragraph (1) of subsection (a) of this Section,
8any future increases in income offered for service as a member
9under this Article to a Tier I employee who has made an
10election under paragraph (1) of subsection (a) of this Section
11shall be offered expressly and irrevocably as constituting
12salary under Section 2-108.
13    As adequate and legal consideration provided under this
14amendatory Act of the 98th General Assembly for making an
15election under paragraph (1) of subsection (a-5) of this
16Section, any future increases in income offered for service as
17a member under this Article to a Tier I retiree who returns to
18active service after having made an election under paragraph
19(1) of subsection (a-5) of this Section shall be offered
20expressly and irrevocably as constituting salary under Section
212-108.
22    (c) A Tier I employee who makes the election under
23paragraph (2) of subsection (a) of this Section shall not be
24subject to either item (i) or (ii) set forth in paragraph (1)
25of subsection (a) of this Section. However, any future
26increases in income offered for service as a member under this

 

 

09800SB2404sam002- 46 -LRB098 09018 EFG 45623 a

1Article to a Tier I employee who has made the election under
2paragraph (2) of subsection (a) of this Section shall be
3offered expressly and irrevocably as not constituting salary
4under Section 2-108, and the member may not accept any future
5increase in income that is offered in violation of this
6requirement.
7    A Tier I retiree who makes the election under paragraph (2)
8of subsection (a-5) of this Section shall not be subject to
9either item (i) or (ii) set forth in paragraph (1) of
10subsection (a-5) of this Section. However, any future increases
11in income offered for service as a member under this Article to
12a Tier I retiree who returns to active service and has made the
13election under paragraph (2) of subsection (a-5) of this
14Section shall be offered expressly and irrevocably as not
15constituting salary under Section 2-108, and the member may not
16accept any future increase in income that is offered in
17violation of this requirement.
18    (d) The System shall make a good faith effort to contact
19each Tier I employee and Tier I retiree subject to this
20Section. The System shall mail information describing the
21required election to each Tier I employee and Tier I retiree by
22United States Postal Service mail to his or her last known
23address on file with the System. If the Tier I employee or Tier
24I retiree is not responsive to other means of contact, it is
25sufficient for the System to publish the details of any
26required elections on its website or to publish those details

 

 

09800SB2404sam002- 47 -LRB098 09018 EFG 45623 a

1in a regularly published newsletter or other existing public
2forum.
3    Tier I employees and Tier I retirees who are subject to
4this Section shall be provided with an election packet
5containing information regarding their options, as well as the
6forms necessary to make the required election. Upon request,
7the System shall offer Tier I employees and Tier I retirees an
8opportunity to receive information from the System before
9making the required election. The information may be provided
10through video materials, group presentations, individual
11consultation with a member or authorized representative of the
12System in person or by telephone or other electronic means, or
13any combination of those methods. The System shall not provide
14advice or counseling with respect to which election a Tier I
15employee or Tier I retiree should make or specific to the legal
16or tax circumstances of or consequences to the Tier I employee
17or Tier I retiree.
18    The System shall inform Tier I employees and Tier I
19retirees in the election packet required under this subsection
20that the Tier I employee or Tier I retiree may also wish to
21obtain information and counsel relating to the election
22required under this Section from any other available source,
23including but not limited to labor organizations and private
24counsel.
25    In no event shall the System, its staff, or the Board be
26held liable for any information given to a member, beneficiary,

 

 

09800SB2404sam002- 48 -LRB098 09018 EFG 45623 a

1or annuitant regarding the elections under this Section. The
2System shall coordinate with the Illinois Department of Central
3Management Services and each other retirement system
4administering an election in accordance with this amendatory
5Act of the 98th General Assembly to provide information
6concerning the impact of the election set forth in this
7Section.
8    (e) Notwithstanding any other provision of law, any future
9increases in income offered for service as a member must be
10offered expressly and irrevocably as not constituting "salary"
11under Section 2-108 to any Tier I employee, or Tier I retiree
12returning to active service, who has made an election under
13paragraph (2) of subsection (a) or (a-5) of Section 2-110.3. A
14Tier I employee, or Tier I retiree returning to active service,
15who has made an election under paragraph (2) or subsection (a)
16or (a-5) of Section 2-110.3 shall not accept any future
17increase in income that is offered for service as a member
18under this Article in violation of the requirement set forth in
19this subsection.
20    (f) A member's election under this Section is not a
21prohibited election under subdivision (j)(1) of Section 1-119
22of this Code.
23    (g) No provision of this Section shall be interpreted in a
24way that would cause the System to cease to be a qualified plan
25under Section 401(a) of the Internal Revenue Code of 1986.
26    (h) If this Section is determined to be unconstitutional or

 

 

09800SB2404sam002- 49 -LRB098 09018 EFG 45623 a

1otherwise invalid by a final unappealable decision of an
2Illinois court or a court of competent jurisdiction as applied
3to Tier I employees but not as applied to Tier I retirees, then
4this Section and the changes deriving from the election
5required under this Section shall be null and void as applied
6to Tier I employees but shall remain in full effect for Tier I
7retirees.
8    (i) If this Section is determined to be unconstitutional or
9otherwise invalid by a final unappealable decision of an
10Illinois court or a court of competent jurisdiction as applied
11to Tier I retirees but not as applied to Tier I employees, then
12this Section and the changes deriving from the election
13required under this Section shall be null and void as applied
14to Tier I retirees but shall remain in full effect for Tier I
15employees.
16    (j) If an election created by this amendatory Act in any
17other Article of this Code or any change deriving from that
18election is determined to be unconstitutional or otherwise
19invalid by a final unappealable decision of an Illinois court
20or a court of competent jurisdiction, the invalidity of that
21provision shall not in any way affect the validity of this
22Section or the changes deriving from the election required
23under this Section.
 
24    (40 ILCS 5/2-119.1)  (from Ch. 108 1/2, par. 2-119.1)
25    Sec. 2-119.1. Automatic increase in retirement annuity.

 

 

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1    (a) Except as provided in subsections (a-1), (a-2), (a-3),
2and (a-4), a A participant who retires after June 30, 1967, and
3who has not received an initial increase under this Section
4before the effective date of this amendatory Act of 1991,
5shall, in January or July next following the first anniversary
6of retirement, whichever occurs first, and in the same month of
7each year thereafter, but in no event prior to age 60, have the
8amount of the originally granted retirement annuity increased
9as follows: for each year through 1971, 1 1/2%; for each year
10from 1972 through 1979, 2%; and for 1980 and each year
11thereafter, 3%. Annuitants who have received an initial
12increase under this subsection prior to the effective date of
13this amendatory Act of 1991 shall continue to receive their
14annual increases in the same month as the initial increase.
15    (a-1) Notwithstanding any other provision of this Article,
16for a Tier I employee who made the election under item (i) of
17paragraph (1) of subsection (a) of Section 2-110.3, the amount
18of each automatic annual increase in retirement annuity
19occurring on or after the effective date of that election,
20other than the initial increase, shall be 3% of the originally
21granted retirement annuity.
22    (a-2) Notwithstanding any other provision of this Article,
23for a Tier I employee who made the election under item (i) of
24paragraph (1) of subsection (a) of Section 2-110.3, once the
25first annual increase under this Section has been granted, the
26next 2 scheduled annual increases shall be skipped, and

 

 

09800SB2404sam002- 51 -LRB098 09018 EFG 45623 a

1thereafter all annual increases shall be granted.
2    (a-3) Notwithstanding any other provision of this Article,
3for a Tier I employee who made the election under item (ii) of
4paragraph (1) of subsection (a) of Section 2-110.3, once the
5first annual increase under this Section has been granted, the
6next 3 scheduled annual increases shall be skipped, and
7thereafter all annual increases shall be granted.
8    (a-4) Notwithstanding any other provision of this Article,
9for a Tier I retiree who made the election under paragraph (1)
10of subsection (a-5) of Section 2-110.3:
11        (1) if the Tier I retiree has not received the first
12    annual increase under this Section as of the effective date
13    of this amendatory Act of the 98th General Assembly, then
14    once the first annual increase under this Section has been
15    granted, the next scheduled annual increase shall be
16    skipped, the following annual increase shall be granted,
17    the next annual increase shall be skipped, and thereafter
18    all annual increases shall be granted; and
19        (2) if the Tier I retiree has received the first annual
20    increase under this Section as of the effective date of
21    this amendatory Act of the 98th General Assembly, then the
22    next annual increase after that effective date shall be
23    skipped, the following annual increase shall be granted,
24    the next annual increase shall be skipped, and thereafter
25    all annual increases shall be granted.
26    (b) Beginning January 1, 1990, for eligible participants

 

 

09800SB2404sam002- 52 -LRB098 09018 EFG 45623 a

1who remain in service after attaining 20 years of creditable
2service, the 3% increases provided under subsection (a) shall
3begin to accrue on the January 1 next following the date upon
4which the participant (1) attains age 55, or (2) attains 20
5years of creditable service, whichever occurs later, and shall
6continue to accrue while the participant remains in service;
7such increases shall become payable on January 1 or July 1,
8whichever occurs first, next following the first anniversary of
9retirement. For any person who has service credit in the System
10for the entire period from January 15, 1969 through December
1131, 1992, regardless of the date of termination of service, the
12reference to age 55 in clause (1) of this subsection (b) shall
13be deemed to mean age 50.
14    This subsection (b) does not apply to any person who first
15becomes a member of the System after August 8, 2003 (the
16effective date of Public Act 93-494) this amendatory Act of the
1793rd General Assembly.
18    (b-5) Notwithstanding any other provision of this Article,
19a participant who first becomes a participant on or after
20January 1, 2011 (the effective date of Public Act 96-889)
21shall, in January or July next following the first anniversary
22of retirement, whichever occurs first, and in the same month of
23each year thereafter, but in no event prior to age 67, have the
24amount of the retirement annuity then being paid increased by
253% or the annual unadjusted percentage increase in the Consumer
26Price Index for All Urban Consumers as determined by the Public

 

 

09800SB2404sam002- 53 -LRB098 09018 EFG 45623 a

1Pension Division of the Department of Insurance under
2subsection (a) of Section 2-108.1, whichever is less.
3    (c) The foregoing provisions relating to automatic
4increases are not applicable to a participant who retires
5before having made contributions (at the rate prescribed in
6Section 2-126) for automatic increases for less than the
7equivalent of one full year. However, in order to be eligible
8for the automatic increases, such a participant may make
9arrangements to pay to the system the amount required to bring
10the total contributions for the automatic increase to the
11equivalent of one year's contributions based upon his or her
12last salary.
13    (d) A participant who terminated service prior to July 1,
141967, with at least 14 years of service is entitled to an
15increase in retirement annuity beginning January, 1976, and to
16additional increases in January of each year thereafter, except
17as otherwise provided in subsection (a-2), (a-3), or (a-4).
18    The initial increase shall be 1 1/2% of the originally
19granted retirement annuity multiplied by the number of full
20years that the annuitant was in receipt of such annuity prior
21to January 1, 1972, plus 2% of the originally granted
22retirement annuity for each year after that date. The
23subsequent annual increases shall be at the rate of 2% of the
24originally granted retirement annuity for each year through
251979 and at the rate of 3% for 1980 and thereafter.
26    (e) Beginning January 1, 1990, and except as provided in

 

 

09800SB2404sam002- 54 -LRB098 09018 EFG 45623 a

1subsection (a-1) or (b-5), all automatic annual increases
2payable under this Section shall be calculated as a percentage
3of the total annuity payable at the time of the increase,
4including previous increases granted under this Article.
5(Source: P.A. 96-889, eff. 1-1-11; 96-1490, eff. 1-1-11.)
 
6    (40 ILCS 5/2-125)  (from Ch. 108 1/2, par. 2-125)
7    Sec. 2-125. Obligations of State; funding guarantee.
8    (a) The payment of (1) the required State contributions,
9(2) all benefits granted under this system and (3) all expenses
10of administration and operation are obligations of the State to
11the extent specified in this Article.
12    All income, interest and dividends derived from deposits
13and investments shall be credited to the account of the system
14in the State Treasury and used to pay benefits under this
15Article.
16    (b) The State shall be contractually obligated to
17contribute to the System in each State fiscal year an amount
18not less than the sum required in Section 2-124 as that Section
19existed prior to the effective date of this amendatory Act of
20the 98th General Assembly.
21    The obligations created under this subsection (b) are
22contractual obligations protected and enforceable under
23Article I, Section 16 and Article XIII, Section 5 of the
24Illinois Constitution.
25    Notwithstanding any other provision of law, if the State

 

 

09800SB2404sam002- 55 -LRB098 09018 EFG 45623 a

1fails to pay in a State fiscal year the amount guaranteed under
2this subsection (b), the System may bring a mandamus action in
3the Circuit Court of Sangamon County to compel the State to
4make that payment, irrespective of other remedies that may be
5available to the System. It shall be the mandatory fiduciary
6obligation of the Board of the System to bring that action if
7the State fails to pay in the fiscal year the amount guaranteed
8under this subsection (b). Before commencing that action, the
9Board shall submit a voucher for contributions required under
10Section 2-134. If the State fails to pay a vouchered amount
11within 90 days after receiving a voucher for that amount, then
12the Board shall submit a written request to the Comptroller
13seeking payment of that amount. A copy of the request shall be
14filed with the Secretary of State, and the Secretary of State
15shall provide copies of the request to the Governor and General
16Assembly. No earlier than the 16th day after filing a request
17with the Secretary, but no later than the 21st day after filing
18that request, the Board may commence such an action in the
19Circuit Court. If the Board fails to commence such action on or
20before the 21st day after filing the request with the Secretary
21of State, then any Tier I employee or Tier I retiree who made
22an election under paragraph (1) of subsection (a) or (a-5) of
23Section 2-110.3 may file a mandamus action against the Board to
24compel the Board to commence its mandamus action against the
25State. This subsection (b) constitutes an express waiver of the
26State's sovereign immunity. In ordering the State to make the

 

 

09800SB2404sam002- 56 -LRB098 09018 EFG 45623 a

1required payment, the court may order a reasonable payment
2schedule to enable the State to make the required payment. The
3obligations and causes of action created under this subsection
4(b) shall be in addition to any other right or remedy otherwise
5accorded by common law, or State or federal law, and nothing in
6this subsection (b) shall be construed to deny, abrogate,
7impair, or waive any such common law or statutory right or
8remedy.
9    Any payments required to be made by the State pursuant to
10this subsection (b) are expressly subordinated to the payment
11of the principal, interest, and premium, if any, on any bonded
12debt obligation of the State or any other State-created entity,
13either currently outstanding or to be issued, for which the
14source of repayment or security thereon is derived directly or
15indirectly from tax revenues collected by the State or any
16other State-created entity. Payments on such bonded
17obligations include any statutory fund transfers or other
18prefunding mechanisms or formulas set forth, now or hereafter,
19in State law or bond indentures, into debt service funds or
20accounts of the State related to such bonded obligations,
21consistent with the payment schedules associated with such
22obligations.
23(Source: P.A. 83-1440.)
 
24    (40 ILCS 5/2-126)  (from Ch. 108 1/2, par. 2-126)
25    Sec. 2-126. Contributions by participants.

 

 

09800SB2404sam002- 57 -LRB098 09018 EFG 45623 a

1    (a) Each participant shall contribute toward the cost of
2his or her retirement annuity a percentage of each payment of
3salary received by him or her for service as a member as
4follows: for service between October 31, 1947 and January 1,
51959, 5%; for service between January 1, 1959 and June 30,
61969, 6%; for service between July 1, 1969 and January 10,
71973, 6 1/2%; for service after January 10, 1973, 7%; for
8service after December 31, 1981, 8 1/2%.
9    (a-5) In addition to the contributions otherwise required
10under this Article, each Tier I employee who made the election
11under item (ii) of paragraph (1) of subsection (a) of Section
122-110.3 shall also make the following contributions toward the
13cost of his or her retirement annuity from each payment of
14salary received by him or her for service as a member:
15        (1) beginning July 1, 2014 and through June 30, 2015,
16    1% of salary; and
17        (2) beginning on July 1, 2015, 2% of salary.
18    (b) Beginning August 2, 1949, each male participant, and
19from July 1, 1971, each female participant shall contribute
20towards the cost of the survivor's annuity 2% of salary.
21    A participant who has no eligible survivor's annuity
22beneficiary may elect to cease making contributions for
23survivor's annuity under this subsection. A survivor's annuity
24shall not be payable upon the death of a person who has made
25this election, unless prior to that death the election has been
26revoked and the amount of the contributions that would have

 

 

09800SB2404sam002- 58 -LRB098 09018 EFG 45623 a

1been paid under this subsection in the absence of the election
2is paid to the System, together with interest at the rate of 4%
3per year from the date the contributions would have been made
4to the date of payment.
5    (c) Beginning July 1, 1967, each participant shall
6contribute 1% of salary towards the cost of automatic increase
7in annuity provided in Section 2-119.1. These contributions
8shall be made concurrently with contributions for retirement
9annuity purposes.
10    (d) In addition, each participant serving as an officer of
11the General Assembly shall contribute, for the same purposes
12and at the same rates as are required of a regular participant,
13on each additional payment received as an officer. If the
14participant serves as an officer for at least 2 but less than 4
15years, he or she shall contribute an amount equal to the amount
16that would have been contributed had the participant served as
17an officer for 4 years. Persons who serve as officers in the
1887th General Assembly but cannot receive the additional payment
19to officers because of the ban on increases in salary during
20their terms may nonetheless make contributions based on those
21additional payments for the purpose of having the additional
22payments included in their highest salary for annuity purposes;
23however, persons electing to make these additional
24contributions must also pay an amount representing the
25corresponding employer contributions, as calculated by the
26System.

 

 

09800SB2404sam002- 59 -LRB098 09018 EFG 45623 a

1    (e) Notwithstanding any other provision of this Article,
2the required contribution of a participant shall not be based
3on any salary in excess of the salary limitation applicable to
4that participant under Section 2-108 or who first becomes a
5participant on or after January 1, 2011 shall not exceed the
6contribution that would be due under this Article if that
7participant's highest salary for annuity purposes were
8$106,800, plus any increases in that amount under Section
92-108.1.
10(Source: P.A. 96-1490, eff. 1-1-11.)
 
11    (40 ILCS 5/2-134)   (from Ch. 108 1/2, par. 2-134)
12    Sec. 2-134. To certify required State contributions and
13submit vouchers.
14    (a) The Board shall certify to the Governor on or before
15December 15 of each year through until December 15, 2011 the
16amount of the required State contribution to the System for the
17next fiscal year and shall specifically identify the System's
18projected State normal cost for that fiscal year. The
19certification under this subsection (a) shall include a copy of
20the actuarial recommendations upon which it is based and shall
21specifically identify the System's projected State normal cost
22for that fiscal year.
23    (a-5) On or before November 1 of each year, beginning
24November 1, 2012, the Board shall submit to the State Actuary,
25the Governor, and the General Assembly a proposed certification

 

 

09800SB2404sam002- 60 -LRB098 09018 EFG 45623 a

1of the amount of the required State contribution to the System
2for the next fiscal year, along with all of the actuarial
3assumptions, calculations, and data upon which that proposed
4certification is based. On or before January 1 of each year,
5beginning January 1, 2013, the State Actuary shall issue a
6preliminary report concerning the proposed certification and
7identifying, if necessary, recommended changes in actuarial
8assumptions that the Board must consider before finalizing its
9certification of the required State contributions.
10    On or before January 15, 2013 and every January 15
11thereafter, the Board shall certify to the Governor and the
12General Assembly the amount of the required State contribution
13for the next fiscal year. The certification shall include a
14copy of the actuarial recommendations upon which it is based
15and shall specifically identify the System's projected State
16normal cost for that fiscal year. The Board's certification
17must note any deviations from the State Actuary's recommended
18changes, the reason or reasons for not following the State
19Actuary's recommended changes, and the fiscal impact of not
20following the State Actuary's recommended changes on the
21required State contribution.
22    (a-7) On or before May 1, 2004, the Board shall recalculate
23and recertify to the Governor the amount of the required State
24contribution to the System for State fiscal year 2005, taking
25into account the amounts appropriated to and received by the
26System under subsection (d) of Section 7.2 of the General

 

 

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1Obligation Bond Act.
2    On or before July 1, 2005, the Board shall recalculate and
3recertify to the Governor the amount of the required State
4contribution to the System for State fiscal year 2006, taking
5into account the changes in required State contributions made
6by this amendatory Act of the 94th General Assembly.
7    On or before April 1, 2011, the Board shall recalculate and
8recertify to the Governor the amount of the required State
9contribution to the System for State fiscal year 2011, applying
10the changes made by Public Act 96-889 to the System's assets
11and liabilities as of June 30, 2009 as though Public Act 96-889
12was approved on that date.
13    (b) Beginning in State fiscal year 1996, on or as soon as
14possible after the 15th day of each month the Board shall
15submit vouchers for payment of State contributions to the
16System, in a total monthly amount of one-twelfth of the
17required annual State contribution certified under subsection
18(a). From the effective date of this amendatory Act of the 93rd
19General Assembly through June 30, 2004, the Board shall not
20submit vouchers for the remainder of fiscal year 2004 in excess
21of the fiscal year 2004 certified contribution amount
22determined under this Section after taking into consideration
23the transfer to the System under subsection (d) of Section
246z-61 of the State Finance Act. These vouchers shall be paid by
25the State Comptroller and Treasurer by warrants drawn on the
26funds appropriated to the System for that fiscal year. If in

 

 

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1any month the amount remaining unexpended from all other
2appropriations to the System for the applicable fiscal year
3(including the appropriations to the System under Section 8.12
4of the State Finance Act and Section 1 of the State Pension
5Funds Continuing Appropriation Act) is less than the amount
6lawfully vouchered under this Section, the difference shall be
7paid from the General Revenue Fund under the continuing
8appropriation authority provided in Section 1.1 of the State
9Pension Funds Continuing Appropriation Act.
10    (c) The full amount of any annual appropriation for the
11System for State fiscal year 1995 shall be transferred and made
12available to the System at the beginning of that fiscal year at
13the request of the Board. Any excess funds remaining at the end
14of any fiscal year from appropriations shall be retained by the
15System as a general reserve to meet the System's accrued
16liabilities.
17(Source: P.A. 96-1497, eff. 1-14-11; 96-1511, eff. 1-27-11;
1897-694, eff. 6-18-12.)
 
19    (40 ILCS 5/2-162)
20    Sec. 2-162. Application and expiration of new benefit
21increases.
22    (a) As used in this Section, "new benefit increase" means
23an increase in the amount of any benefit provided under this
24Article, or an expansion of the conditions of eligibility for
25any benefit under this Article, that results from an amendment

 

 

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1to this Code that takes effect after the effective date of this
2amendatory Act of the 94th General Assembly. "New benefit
3increase", however, does not include any benefit increase
4resulting from the changes made to this Article by this
5amendatory Act of the 98th General Assembly.
6    (b) Notwithstanding any other provision of this Code or any
7subsequent amendment to this Code, every new benefit increase
8is subject to this Section and shall be deemed to be granted
9only in conformance with and contingent upon compliance with
10the provisions of this Section.
11    (c) The Public Act enacting a new benefit increase must
12identify and provide for payment to the System of additional
13funding at least sufficient to fund the resulting annual
14increase in cost to the System as it accrues.
15    Every new benefit increase is contingent upon the General
16Assembly providing the additional funding required under this
17subsection. The Commission on Government Forecasting and
18Accountability shall analyze whether adequate additional
19funding has been provided for the new benefit increase and
20shall report its analysis to the Public Pension Division of the
21Department of Financial and Professional Regulation. A new
22benefit increase created by a Public Act that does not include
23the additional funding required under this subsection is null
24and void. If the Public Pension Division determines that the
25additional funding provided for a new benefit increase under
26this subsection is or has become inadequate, it may so certify

 

 

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1to the Governor and the State Comptroller and, in the absence
2of corrective action by the General Assembly, the new benefit
3increase shall expire at the end of the fiscal year in which
4the certification is made.
5    (d) Every new benefit increase shall expire 5 years after
6its effective date or on such earlier date as may be specified
7in the language enacting the new benefit increase or provided
8under subsection (c). This does not prevent the General
9Assembly from extending or re-creating a new benefit increase
10by law.
11    (e) Except as otherwise provided in the language creating
12the new benefit increase, a new benefit increase that expires
13under this Section continues to apply to persons who applied
14and qualified for the affected benefit while the new benefit
15increase was in effect and to the affected beneficiaries and
16alternate payees of such persons, but does not apply to any
17other person, including without limitation a person who
18continues in service after the expiration date and did not
19apply and qualify for the affected benefit while the new
20benefit increase was in effect.
21(Source: P.A. 94-4, eff. 6-1-05.)
 
22    (40 ILCS 5/7-109)  (from Ch. 108 1/2, par. 7-109)
23    Sec. 7-109. Employee.
24    (1) "Employee" means any person who:
25        (a) 1. Receives earnings as payment for the performance

 

 

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1        of personal services or official duties out of the
2        general fund of a municipality, or out of any special
3        fund or funds controlled by a municipality, or by an
4        instrumentality thereof, or a participating
5        instrumentality, including, in counties, the fees or
6        earnings of any county fee office; and
7            2. Under the usual common law rules applicable in
8        determining the employer-employee relationship, has
9        the status of an employee with a municipality, or any
10        instrumentality thereof, or a participating
11        instrumentality, including aldermen, county
12        supervisors and other persons (excepting those
13        employed as independent contractors) who are paid
14        compensation, fees, allowances or other emolument for
15        official duties, and, in counties, the several county
16        fee offices.
17        (b) Serves as a township treasurer appointed under the
18    School Code, as heretofore or hereafter amended, and who
19    receives for such services regular compensation as
20    distinguished from per diem compensation, and any regular
21    employee in the office of any township treasurer whether or
22    not his earnings are paid from the income of the permanent
23    township fund or from funds subject to distribution to the
24    several school districts and parts of school districts as
25    provided in the School Code, or from both such sources; or
26    is the chief executive officer, chief educational officer,

 

 

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1    chief fiscal officer, or other employee of a Financial
2    Oversight Panel established pursuant to Article 1H of the
3    School Code, other than a superintendent or certified
4    school business official, except that such person shall not
5    be treated as an employee under this Section if that person
6    has negotiated with the Financial Oversight Panel, in
7    conjunction with the school district, a contractual
8    agreement for exclusion from this Section.
9        (c) Holds an elective office in a municipality,
10    instrumentality thereof or participating instrumentality.
11    (2) "Employee" does not include persons who:
12        (a) Are eligible for inclusion under any of the
13    following laws:
14            1. "An Act in relation to an Illinois State
15        Teachers' Pension and Retirement Fund", approved May
16        27, 1915, as amended;
17            2. Articles 15 and 16 of this Code.
18        However, such persons shall be included as employees to
19    the extent of earnings that are not eligible for inclusion
20    under the foregoing laws for services not of an
21    instructional nature of any kind.
22        However, any member of the armed forces who is employed
23    as a teacher of subjects in the Reserve Officers Training
24    Corps of any school and who is not certified under the law
25    governing the certification of teachers shall be included
26    as an employee.

 

 

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1        (b) Are designated by the governing body of a
2    municipality in which a pension fund is required by law to
3    be established for policemen or firemen, respectively, as
4    performing police or fire protection duties, except that
5    when such persons are the heads of the police or fire
6    department and are not eligible to be included within any
7    such pension fund, they shall be included within this
8    Article; provided, that such persons shall not be excluded
9    to the extent of concurrent service and earnings not
10    designated as being for police or fire protection duties.
11    However, (i) any head of a police department who was a
12    participant under this Article immediately before October
13    1, 1977 and did not elect, under Section 3-109 of this Act,
14    to participate in a police pension fund shall be an
15    "employee", and (ii) any chief of police who elects to
16    participate in this Fund under Section 3-109.1 of this
17    Code, regardless of whether such person continues to be
18    employed as chief of police or is employed in some other
19    rank or capacity within the police department, shall be an
20    employee under this Article for so long as such person is
21    employed to perform police duties by a participating
22    municipality and has not lawfully rescinded that election.
23        (c) After August 26, 2011 (the effective date of Public
24    Act 97-609), are contributors to or eligible to contribute
25    to a Taft-Hartley pension plan established on or before
26    June 1, 2011 and are employees of a theatre, arena, or

 

 

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1    convention center that is located in a municipality located
2    in a county with a population greater than 5,000,000, and
3    to which the participating municipality is required to
4    contribute as the person's employer based on earnings from
5    the municipality. Nothing in this paragraph shall affect
6    service credit or creditable service for any period of
7    service prior to August 26, 2011, and this paragraph shall
8    not apply to individuals who are participating in the Fund
9    prior to August 26, 2011.
10        (d) Become an employee of any of the following
11    participating instrumentalities on or after the effective
12    date of this amendatory Act of the 98th General Assembly:
13    the Illinois Municipal League; the Illinois Association of
14    Park Districts; the Illinois Supervisors, County
15    Commissioners and Superintendents of Highways Association;
16    an association or not-for-profit corporation, membership
17    in which is authorized under Section 85-15 of the Township
18    Code; the United Counties Council; or the Will County
19    Governmental League.
20    (3) All persons, including, without limitation, public
21defenders and probation officers, who receive earnings from
22general or special funds of a county for performance of
23personal services or official duties within the territorial
24limits of the county, are employees of the county (unless
25excluded by subsection (2) of this Section) notwithstanding
26that they may be appointed by and are subject to the direction

 

 

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1of a person or persons other than a county board or a county
2officer. It is hereby established that an employer-employee
3relationship under the usual common law rules exists between
4such employees and the county paying their salaries by reason
5of the fact that the county boards fix their rates of
6compensation, appropriate funds for payment of their earnings
7and otherwise exercise control over them. This finding and this
8amendatory Act shall apply to all such employees from the date
9of appointment whether such date is prior to or after the
10effective date of this amendatory Act and is intended to
11clarify existing law pertaining to their status as
12participating employees in the Fund.
13(Source: P.A. 97-429, eff. 8-16-11; 97-609, eff. 8-26-11;
1497-813, eff. 7-13-12.)
 
15    (40 ILCS 5/14-103.10)  (from Ch. 108 1/2, par. 14-103.10)
16    Sec. 14-103.10. Compensation.
17    (a) For periods of service prior to January 1, 1978, the
18full rate of salary or wages payable to an employee for
19personal services performed if he worked the full normal
20working period for his position, subject to the following
21maximum amounts: (1) prior to July 1, 1951, $400 per month or
22$4,800 per year; (2) between July 1, 1951 and June 30, 1957
23inclusive, $625 per month or $7,500 per year; (3) beginning
24July 1, 1957, no limitation.
25    In the case of service of an employee in a position

 

 

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1involving part-time employment, compensation shall be
2determined according to the employees' earnings record.
3    (b) For periods of service on and after January 1, 1978,
4all remuneration for personal services performed defined as
5"wages" under the Social Security Enabling Act, including that
6part of such remuneration which is in excess of any maximum
7limitation provided in such Act, and including any benefits
8received by an employee under a sick pay plan in effect before
9January 1, 1981, but excluding lump sum salary payments:
10        (1) for vacation,
11        (2) for accumulated unused sick leave,
12        (3) upon discharge or dismissal,
13        (4) for approved holidays.
14    (c) For periods of service on or after December 16, 1978,
15compensation also includes any benefits, other than lump sum
16salary payments made at termination of employment, which an
17employee receives or is eligible to receive under a sick pay
18plan authorized by law.
19    (d) For periods of service after September 30, 1985,
20compensation also includes any remuneration for personal
21services not included as "wages" under the Social Security
22Enabling Act, which is deducted for purposes of participation
23in a program established pursuant to Section 125 of the
24Internal Revenue Code or its successor laws.
25    (e) For members for which Section 1-160 applies for periods
26of service on and after January 1, 2011, all remuneration for

 

 

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1personal services performed defined as "wages" under the Social
2Security Enabling Act, excluding remuneration that is in excess
3of the annual earnings, salary, or wages of a member or
4participant, as provided in subsection (b-5) of Section 1-160,
5but including any benefits received by an employee under a sick
6pay plan in effect before January 1, 1981. Compensation shall
7exclude lump sum salary payments:
8        (1) for vacation;
9        (2) for accumulated unused sick leave;
10        (3) upon discharge or dismissal; and
11        (4) for approved holidays.
12    (f) Notwithstanding any other provision of this Section,
13"compensation" does not include any future increase in income
14offered by a department under this Article pursuant to the
15requirements of subsection (c) of Section 14-106.5 that is
16accepted by a Tier I employee, or a Tier I retiree returning to
17active service, who has made the election under paragraph (2)
18of subsection (a) or (a-5) of Section 14-106.5.
19    (g) Notwithstanding any other provision of this Section,
20for an employee who first becomes a participant on or after the
21effective date of this amendatory Act of the 98th General
22Assembly, "compensation" does not include any payments or
23reimbursements for travel vouchers submitted more than 30 days
24after the last day of travel for which the voucher is
25submitted.
26(Source: P.A. 96-1490, eff. 1-1-11.)
 

 

 

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1    (40 ILCS 5/14-103.40 new)
2    Sec. 14-103.40. Tier I employee. "Tier I employee": An
3employee under this Article who first became a member or
4participant before January 1, 2011 under any reciprocal
5retirement system or pension fund established under this Code
6other than a retirement system or pension fund established
7under Article 2, 3, 4, 5, 6, or 18 of this Code.
 
8    (40 ILCS 5/14-103.41 new)
9    Sec. 14-103.41. Tier I retiree. "Tier I retiree": A former
10Tier I employee who is receiving a retirement annuity.
 
11    (40 ILCS 5/14-103.42 new)
12    Sec. 14-103.42. Future increase in income. "Future
13increase in income": Any increase in income in any form offered
14by a department to an employee under this Article after June
1530, 2014 that would qualify as "compensation", as defined in
16Section 14-103.10, but for the fact that the department offered
17the increase in income to the employee on the condition that it
18not qualify as compensation and the employee accepted the
19increase in income subject to that condition. The term "future
20increase in income" does not include an increase in income in
21any form that is paid to a Tier I employee under an employment
22contract or collective bargaining agreement that is in effect
23on the effective date of this Section but does include an

 

 

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1increase in income in any form pursuant to an extension,
2amendment, or renewal of any such employment contract or
3collective bargaining agreement on or after the effective date
4of this amendatory Act of the 98th General Assembly.
 
5    (40 ILCS 5/14-106.5 new)
6    Sec. 14-106.5. Election by Tier I employees and Tier I
7retirees.
8    (a) Each Tier I employee shall make an irrevocable election
9either:
10        (1) to agree to item (i) or (ii) as set forth in this
11    paragraph (1):
12            (i) to have the amount of the automatic annual
13        increases in his or her retirement annuity that are
14        otherwise provided for in this Article calculated,
15        instead, as provided in subsection (a-1) of Section
16        14-114, and to waive his or her eligibility for 2
17        automatic annual increases in retirement annuity as
18        provided in subsection (a-2) of Section 14-114; or
19            (ii) to waive his or her eligibility for 3
20        automatic annual increases in retirement annuity, as
21        provided in subsection (a-3) of Section 14-114, and to
22        make the contributions set forth in subsection (a-5) of
23        Section 14-133; or
24        (2) to not agree to item (i) or (ii) as set forth in
25    paragraph (1) of this subsection.

 

 

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1    The election required under this subsection (a) shall be
2made by each Tier I employee no earlier than February 1, 2014
3and no later than May 31, 2014, except that:
4        (i) a person who becomes a Tier I employee under this
5    Article on or after February 1, 2014 must make the election
6    under this subsection (a) within 60 days after becoming a
7    Tier I employee;
8        (ii) a person who returns to active service as a Tier I
9    employee under this Article on or after February 1, 2014
10    and has not yet made an election under this Section must
11    make the election under this subsection (a) within 60 days
12    after returning to active service as a Tier I employee; and
13        (iii) a person who made the election under subsection
14    (a-5) as a Tier I retiree remains bound by that election
15    and shall not make a later election under this subsection
16    (a).
17    If a Tier I employee fails for any reason to make a
18required election under this subsection within the time
19specified, then the employee shall be deemed to have made the
20election under paragraph (2) of this subsection.
21    (a-5) Each Tier I retiree shall make an irrevocable
22election either:
23        (1) to agree to the following:
24            (i) to have the amount of the automatic annual
25        increases in his or her retirement annuity calculated
26        without regard to subsection (a-1), (a-2), or (a-3) of

 

 

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1        Section 14-114; and
2            (ii) to waive his or her eligibility for 2
3        automatic annual increases in retirement annuity as
4        provided in subsection (a-4) of Section 14-114; or
5        (2) to not agree to items (i) and (ii) as set forth in
6    paragraph (1) of this subsection.
7    The election required under this subsection (a-5) shall be
8made by each Tier I retiree no earlier than February 1, 2014
9and no later than May 31, 2014, except that:
10        (i) a person who becomes a Tier I retiree under this
11    Article on or after February 1, 2014 must make the election
12    under this subsection (a-5) within 60 days after becoming a
13    Tier I retiree; and
14        (ii) a person who made the election under subsection
15    (a) as a Tier I employee remains bound by that election and
16    shall not make a later election under this subsection
17    (a-5).
18    If a Tier I retiree fails for any reason to make a required
19election under this subsection within the time specified, then
20the Tier I retiree shall be deemed to have made the election
21under paragraph (2) of this subsection.
22    (a-10) All elections under subsection (a) or (a-5) that are
23made or deemed to be made before June 1, 2014 shall take effect
24on July 1, 2014. Elections that are made or deemed to be made
25on or after June 1, 2014 shall take effect on the first day of
26the month following the month in which the election is made or

 

 

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1deemed to be made.
2    (b) As adequate and legal consideration provided under this
3amendatory Act of the 98th General Assembly for making an
4election under paragraph (1) of subsection (a) of this Section,
5any future increases in income offered by a department under
6this Article to a Tier I employee who has made an election
7under paragraph (1) of subsection (a) of this Section shall be
8offered expressly and irrevocably as constituting compensation
9under Section 14-103.10. In addition, a Tier I employee who has
10made an election under item (i) of paragraph (1) of subsection
11(a) of this Section shall receive the right to also participate
12in the optional cash balance plan established under Section
131-162.
14    As adequate and legal consideration provided under this
15amendatory Act of the 98th General Assembly for making an
16election under paragraph (1) of subsection (a-5) of this
17Section, any future increases in income offered by a department
18under this Article to a Tier I retiree who returns to active
19service after having made the election under paragraph (1) of
20subsection (a-5) of this Section shall be offered expressly and
21irrevocably as constituting compensation under Section
2214-103.10.
23    (c) A Tier I employee who makes the election under
24paragraph (2) of subsection (a) of this Section shall not be
25subject to either item (i) or (ii) set forth in paragraph (1)
26of subsection (a) of this Section. However, any future

 

 

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1increases in income offered by a department under this Article
2to a Tier I employee who has made the election under paragraph
3(2) of subsection (a) of this Section shall be offered by the
4department expressly and irrevocably as not constituting
5compensation under Section 14-103.10, and the employee may not
6accept any future increase in income that is offered in
7violation of this requirement. In addition, a Tier I employee
8who has made the election under paragraph (2) of subsection (a)
9of this Section shall not receive the right to participate in
10the optional cash balance plan established under Section 1-162.
11    A Tier I retiree who makes the election under paragraph (2)
12of subsection (a-5) of this Section shall not be subject to
13either item (i) or (ii) set forth in paragraph (1) of
14subsection (a-5) of this Section. However, any future increases
15in income offered by a department under this Article to a Tier
16I retiree who returns to active service and has made the
17election under paragraph (2) of subsection (a-5) of this
18Section shall be offered by the department expressly and
19irrevocably as not constituting compensation under Section
2014-103.10, and the employee may not accept any future increase
21in income that is offered in violation of this requirement. In
22addition, a Tier I retiree who returns to active service and
23has made the election under paragraph (2) of subsection (a) of
24this Section shall not receive the right to participate in the
25optional cash balance plan established under Section 1-162.
26    (d) The System shall make a good faith effort to contact

 

 

09800SB2404sam002- 78 -LRB098 09018 EFG 45623 a

1each Tier I employee and Tier I retiree subject to this
2Section. The System shall mail information describing the
3required election to each Tier I employee and Tier I retiree by
4United States Postal Service mail to his or her last known
5address on file with the System. If the Tier I employee or Tier
6I retiree is not responsive to other means of contact, it is
7sufficient for the System to publish the details of any
8required elections on its website or to publish those details
9in a regularly published newsletter or other existing public
10forum.
11    Tier I employees and Tier I retirees who are subject to
12this Section shall be provided with an election packet
13containing information regarding their options, as well as the
14forms necessary to make the required election. Upon request,
15the System shall offer Tier I employees and Tier I retirees an
16opportunity to receive information from the System before
17making the required election. The information may consist of
18video materials, group presentations, individual consultation
19with a member or authorized representative of the System in
20person or by telephone or other electronic means, or any
21combination of those methods. The System shall not provide
22advice or counseling with respect to which election a Tier I
23employee or Tier I retiree should make or specific to the legal
24or tax circumstances of or consequences to the Tier I employee
25or Tier I retiree.
26    The System shall inform Tier I employees and Tier I

 

 

09800SB2404sam002- 79 -LRB098 09018 EFG 45623 a

1retirees in the election packet required under this subsection
2that the Tier I employee or Tier I retiree may also wish to
3obtain information and counsel relating to the election
4required under this Section from any other available source,
5including but not limited to labor organizations and private
6counsel.
7    In no event shall the System, its staff, or the Board be
8held liable for any information given to a member, beneficiary,
9or annuitant regarding the elections under this Section. The
10System shall coordinate with the Illinois Department of Central
11Management Services and each other retirement system
12administering an election in accordance with this amendatory
13Act of the 98th General Assembly to provide information
14concerning the impact of the election set forth in this
15Section.
16    (e) Notwithstanding any other provision of law, a
17department under this Article is required to offer any future
18increases in income expressly and irrevocably as not
19constituting "compensation" under Section 14-103.10 to any
20Tier I employee, or Tier I retiree returning to active service,
21who has made an election under paragraph (2) of subsection (a)
22or (a-5) of Section 14-106.5. A Tier I employee, or Tier I
23retiree returning to active service, who has made an election
24under paragraph (2) of subsection (a) or (a-5) of Section
2514-106.5 shall not accept any future increase in income that is
26offered by an employer under this Article in violation of the

 

 

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1requirement set forth in this subsection.
2    (f) A member's election under this Section is not a
3prohibited election under subdivision (j)(1) of Section 1-119
4of this Code.
5    (g) An employee who has made the election under item (i) of
6paragraph (1) of subsection (a) of this Section may elect to
7participate in the optional cash balance plan under Section
81-162.
9    The election to participate in the optional cash balance
10plan shall be made in writing, in the manner provided by the
11applicable retirement system.
12    (h) No provision of this Section shall be interpreted in a
13way that would cause the System to cease to be a qualified plan
14under Section 401(a) of the Internal Revenue Code of 1986.
15    (i) If this Section is determined to be unconstitutional or
16otherwise invalid by a final unappealable decision of an
17Illinois court or a court of competent jurisdiction as applied
18to Tier I employees but not as applied to Tier I retirees, then
19this Section and the changes deriving from the election
20required under this Section shall be null and void as applied
21to Tier I employees but shall remain in full effect for Tier I
22retirees.
23    (j) If this Section is determined to be unconstitutional or
24otherwise invalid by a final unappealable decision of an
25Illinois court or a court of competent jurisdiction as applied
26to Tier I retirees but not as applied to Tier I employees, then

 

 

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1this Section and the changes deriving from the election
2required under this Section shall be null and void as applied
3to Tier I retirees but shall remain in full effect for Tier I
4employees.
5    (k) If an election created by this amendatory Act in any
6other Article of this Code or any change deriving from that
7election is determined to be unconstitutional or otherwise
8invalid by a final unappealable decision of an Illinois court
9or a court of competent jurisdiction, the invalidity of that
10provision shall not in any way affect the validity of this
11Section or the changes deriving from the election required
12under this Section.
 
13    (40 ILCS 5/14-114)  (from Ch. 108 1/2, par. 14-114)
14    Sec. 14-114. Automatic increase in retirement annuity.
15    (a) Subject to the provisions of subsections (a-1), (a-2),
16(a-3), and (a-4), any Any person receiving a retirement annuity
17under this Article who retires having attained age 60, or who
18retires before age 60 having at least 35 years of creditable
19service, or who retires on or after January 1, 2001 at an age
20which, when added to the number of years of his or her
21creditable service, equals at least 85, shall, on January 1
22next following the first full year of retirement, have the
23amount of the then fixed and payable monthly retirement annuity
24increased 3%. Any person receiving a retirement annuity under
25this Article who retires before attainment of age 60 and with

 

 

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1less than (i) 35 years of creditable service if retirement is
2before January 1, 2001, or (ii) the number of years of
3creditable service which, when added to the member's age, would
4equal 85, if retirement is on or after January 1, 2001, shall
5have the amount of the fixed and payable retirement annuity
6increased by 3% on the January 1 occurring on or next following
7(1) attainment of age 60, or (2) the first anniversary of
8retirement, whichever occurs later. However, for persons who
9receive the alternative retirement annuity under Section
1014-110, references in this subsection (a) to attainment of age
1160 shall be deemed to refer to attainment of age 55. For a
12person receiving early retirement incentives under Section
1314-108.3 whose retirement annuity began after January 1, 1992
14pursuant to an extension granted under subsection (e) of that
15Section, the first anniversary of retirement shall be deemed to
16be January 1, 1993. For a person who retires on or after June
1728, 2001 and on or before October 1, 2001, and whose retirement
18annuity is calculated, in whole or in part, under Section
1914-110 or subsection (g) or (h) of Section 14-108, the first
20anniversary of retirement shall be deemed to be January 1,
212002.
22    On each January 1 following the date of the initial
23increase under this subsection, the employee's monthly
24retirement annuity shall be increased by an additional 3%.
25    Beginning January 1, 1990, and except as provided in
26subsection (a-1), all automatic annual increases payable under

 

 

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1this Section shall be calculated as a percentage of the total
2annuity payable at the time of the increase, including previous
3increases granted under this Article.
4    (a-1) Notwithstanding any other provision of this Article,
5for a Tier I employee who made the election under item (i) of
6paragraph (1) of subsection (a) of Section 14-106.5, the amount
7of each automatic annual increase in retirement annuity
8occurring on or after the effective date of that election shall
9be 3% of the originally granted retirement annuity.
10    (a-2) Notwithstanding any other provision of this Article,
11for a Tier I employee who made the election under item (i) of
12paragraph (1) of subsection (a) of Section 14-106.5, once the
13first annual increase under this Section has been granted, the
14next 2 scheduled annual increases shall be skipped, and
15thereafter all annual increases shall be granted.
16    (a-3) Notwithstanding any other provision of this Article,
17for a Tier I employee who made the election under item (ii) of
18paragraph (1) of subsection (a) of Section 14-106.5, once the
19first annual increase under this Section has been granted, the
20next 3 scheduled annual increases shall be skipped, and
21thereafter all annual increases shall be granted.
22    (a-4) Notwithstanding any other provision of this Article,
23for a Tier I retiree who made the election under paragraph (1)
24of subsection (a-5) of Section 14-106.5:
25        (1) if the Tier I retiree has not received the first
26    annual increase under this Section as of the effective date

 

 

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1    of this amendatory Act of the 98th General Assembly, then
2    once the first annual increase under this Section has been
3    granted, the next scheduled annual increase shall be
4    skipped, the following annual increase shall be granted,
5    the next annual increase shall be skipped, and thereafter
6    all annual increases shall be granted; and
7        (2) if the Tier I retiree has received the first annual
8    increase under this Section as of the effective date of
9    this amendatory Act of the 98th General Assembly, then the
10    next annual increase after that effective date shall be
11    skipped, the following annual increase shall be granted,
12    the next annual increase shall be skipped, and thereafter
13    all annual increases shall be granted.
14    (b) The provisions of subsection (a) of this Section shall
15be applicable to an employee only if the employee makes the
16additional contributions required after December 31, 1969 for
17the purpose of the automatic increases for not less than the
18equivalent of one full year. If an employee becomes an
19annuitant before his additional contributions equal one full
20year's contributions based on his salary at the date of
21retirement, the employee may pay the necessary balance of the
22contributions to the system, without interest, and be eligible
23for the increasing annuity authorized by this Section.
24    (c) The provisions of subsection (a) of this Section shall
25not be applicable to any annuitant who is on retirement on
26December 31, 1969, and thereafter returns to State service,

 

 

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1unless the member has established at least one year of
2additional creditable service following reentry into service.
3    (d) In addition to other increases which may be provided by
4this Section, on January 1, 1981 any annuitant who was
5receiving a retirement annuity on or before January 1, 1971
6shall have his retirement annuity then being paid increased $1
7per month for each year of creditable service. On January 1,
81982, any annuitant who began receiving a retirement annuity on
9or before January 1, 1977, shall have his retirement annuity
10then being paid increased $1 per month for each year of
11creditable service.
12    On January 1, 1987, any annuitant who began receiving a
13retirement annuity on or before January 1, 1977, shall have the
14monthly retirement annuity increased by an amount equal to 8
15per year of creditable service times the number of years that
16have elapsed since the annuity began.
17    (e) Every person who receives the alternative retirement
18annuity under Section 14-110 and who is eligible to receive the
193% increase under subsection (a) on January 1, 1986, shall also
20receive on that date a one-time increase in retirement annuity
21equal to the difference between (1) his actual retirement
22annuity on that date, including any increases received under
23subsection (a), and (2) the amount of retirement annuity he
24would have received on that date if the amendments to
25subsection (a) made by Public Act 84-162 had been in effect
26since the date of his retirement.

 

 

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1(Source: P.A. 91-927, eff. 12-14-00; 92-14, eff. 6-28-01;
292-651, eff. 7-11-02.)
 
3    (40 ILCS 5/14-132)  (from Ch. 108 1/2, par. 14-132)
4    Sec. 14-132. Obligations of State; funding guarantee.
5    (a) The payment of the required department contributions,
6all allowances, annuities, benefits granted under this
7Article, and all expenses of administration of the system are
8obligations of the State of Illinois to the extent specified in
9this Article.
10    All income of the system shall be credited to a separate
11account for this system in the State treasury and shall be used
12to pay allowances, annuities, benefits and administration
13expense.
14    (b) The State shall be contractually obligated to
15contribute to the System in each State fiscal year an amount
16not less than the sum required in Section 14-131 as that
17Section existed prior to the effective date of this amendatory
18Act of the 98th General Assembly.
19    The obligations created under this subsection (b) are
20contractual obligations protected and enforceable under
21Article I, Section 16 and Article XIII, Section 5 of the
22Illinois Constitution.
23    Notwithstanding any other provision of law, if the State
24fails to pay in a State fiscal year the amount guaranteed under
25this subsection (b), the System may bring a mandamus action in

 

 

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1the Circuit Court of Sangamon County to compel the State to
2make that payment, irrespective of other remedies that may be
3available to the System. It shall be the mandatory fiduciary
4obligation of the Board of the System to bring that action if
5the State fails to pay in the fiscal year the amount guaranteed
6under this subsection (b). Before commencing that action, the
7Board shall submit a voucher for the contributions required in
8Section 14-131. If the State fails to pay a vouchered amount
9within 90 days after receiving a voucher for that amount, then
10the Board shall submit a written request to the Comptroller
11seeking payment of that amount. A copy of the request shall be
12filed with the Secretary of State, and the Secretary of State
13shall provide copies of the request to the Governor and General
14Assembly. No earlier than the 16th day after filing a request
15with the Secretary, but no later than the 21st day after filing
16that request, the Board may commence such an action in the
17Circuit Court. If the Board fails to commence such action on or
18before the 21st day after filing the request with the Secretary
19of State, then any Tier I employee or Tier I retiree who made
20the election under paragraph (1) of subsection (a) or (a-5) of
21Section 14-106.5 may file a mandamus action against the Board
22to compel the Board to commence its mandamus action against the
23State. This subsection (b) constitutes an express waiver of the
24State's sovereign immunity. In ordering the State to make the
25required payment, the court may order a reasonable payment
26schedule to enable the State to make the required payment. The

 

 

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1obligations and causes of action created under this subsection
2(b) shall be in addition to any other right or remedy otherwise
3accorded by common law, or State or federal law, and nothing in
4this subsection shall be construed to deny, abrogate, impair,
5or waive any such common law or statutory right or remedy.
6    Any payments required to be made by the State pursuant to
7this subsection (b) are expressly subordinated to the payment
8of the principal, interest, and premium, if any, on any bonded
9debt obligation of the State or any other State-created entity,
10either currently outstanding or to be issued, for which the
11source of repayment or security thereon is derived directly or
12indirectly from tax revenues collected by the State or any
13other State-created entity. Payments on such bonded
14obligations include any statutory fund transfers or other
15prefunding mechanisms or formulas set forth, now or hereafter,
16in State law or bond indentures, into debt service funds or
17accounts of the State related to such bonded obligations,
18consistent with the payment schedules associated with such
19obligations.
20(Source: P.A. 80-841.)
 
21    (40 ILCS 5/14-133)  (from Ch. 108 1/2, par. 14-133)
22    Sec. 14-133. Contributions on behalf of members.
23    (a) Each participating employee shall make contributions
24to the System, based on the employee's compensation, as
25follows:

 

 

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1        (1) Covered employees, except as indicated below, 3.5%
2    for retirement annuity, and 0.5% for a widow or survivors
3    annuity;
4        (2) Noncovered employees, except as indicated below,
5    7% for retirement annuity and 1% for a widow or survivors
6    annuity;
7        (3) Noncovered employees serving in a position in which
8    "eligible creditable service" as defined in Section 14-110
9    may be earned, 1% for a widow or survivors annuity plus the
10    following amount for retirement annuity: 8.5% through
11    December 31, 2001; 9.5% in 2002; 10.5% in 2003; and 11.5%
12    in 2004 and thereafter;
13        (4) Covered employees serving in a position in which
14    "eligible creditable service" as defined in Section 14-110
15    may be earned, 0.5% for a widow or survivors annuity plus
16    the following amount for retirement annuity: 5% through
17    December 31, 2001; 6% in 2002; 7% in 2003; and 8% in 2004
18    and thereafter;
19        (5) Each security employee of the Department of
20    Corrections or of the Department of Human Services who is a
21    covered employee, 0.5% for a widow or survivors annuity
22    plus the following amount for retirement annuity: 5%
23    through December 31, 2001; 6% in 2002; 7% in 2003; and 8%
24    in 2004 and thereafter;
25        (6) Each security employee of the Department of
26    Corrections or of the Department of Human Services who is

 

 

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1    not a covered employee, 1% for a widow or survivors annuity
2    plus the following amount for retirement annuity: 8.5%
3    through December 31, 2001; 9.5% in 2002; 10.5% in 2003; and
4    11.5% in 2004 and thereafter.
5    (a-1) In addition to the contributions required under
6subsection (a), an employee who elects to participate in the
7optional cash balance plan under Section 1-162 shall pay to the
8System for the purpose of participating in the optional cash
9balance plan an additional contribution of 2% of each payment
10of compensation received while he or she is a participant in
11the optional cash balance plan. These contributions shall not
12be used for the purpose of determining any benefit under this
13Article except as provided in the optional cash balance plan.
14    (a-5) In addition to the contributions otherwise required
15under this Article, each Tier I member who made the election
16under item (ii) of paragraph (1) of subsection (a) of Section
1714-106.5 shall also make the following contributions for
18retirement annuity from each payment of compensation:
19        (1) beginning July 1, 2014 and through June 30, 2015,
20    1% of compensation; and
21        (2) beginning on July 1, 2015, 2% of compensation.
22    (b) Contributions shall be in the form of a deduction from
23compensation and shall be made notwithstanding that the
24compensation paid in cash to the employee shall be reduced
25thereby below the minimum prescribed by law or regulation. Each
26member is deemed to consent and agree to the deductions from

 

 

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1compensation provided for in this Article, and shall receipt in
2full for salary or compensation.
3(Source: P.A. 92-14, eff. 6-28-01.)
 
4    (40 ILCS 5/14-135.08)  (from Ch. 108 1/2, par. 14-135.08)
5    Sec. 14-135.08. To certify required State contributions.
6    (a) To certify to the Governor and to each department, on
7or before November 15 of each year through until November 15,
82011, the required rate for State contributions to the System
9for the next State fiscal year, as determined under subsection
10(b) of Section 14-131. The certification to the Governor under
11this subsection (a) shall include a copy of the actuarial
12recommendations upon which the rate is based and shall
13specifically identify the System's projected State normal cost
14for that fiscal year.
15    (a-5) On or before November 1 of each year, beginning
16November 1, 2012, the Board shall submit to the State Actuary,
17the Governor, and the General Assembly a proposed certification
18of the amount of the required State contribution to the System
19for the next fiscal year, along with all of the actuarial
20assumptions, calculations, and data upon which that proposed
21certification is based. On or before January 1 of each year,
22beginning January 1, 2013, the State Actuary shall issue a
23preliminary report concerning the proposed certification and
24identifying, if necessary, recommended changes in actuarial
25assumptions that the Board must consider before finalizing its

 

 

09800SB2404sam002- 92 -LRB098 09018 EFG 45623 a

1certification of the required State contributions.
2    On or before January 15, 2013 and each January 15
3thereafter, the Board shall certify to the Governor and the
4General Assembly the amount of the required State contribution
5for the next fiscal year. The certification shall include a
6copy of the actuarial recommendations upon which it is based
7and shall specifically identify the System's projected State
8normal cost for that fiscal year. The Board's certification
9must note any deviations from the State Actuary's recommended
10changes, the reason or reasons for not following the State
11Actuary's recommended changes, and the fiscal impact of not
12following the State Actuary's recommended changes on the
13required State contribution.
14    (b) The certifications under subsections (a) and (a-5)
15shall include an additional amount necessary to pay all
16principal of and interest on those general obligation bonds due
17the next fiscal year authorized by Section 7.2(a) of the
18General Obligation Bond Act and issued to provide the proceeds
19deposited by the State with the System in July 2003,
20representing deposits other than amounts reserved under
21Section 7.2(c) of the General Obligation Bond Act. For State
22fiscal year 2005, the Board shall make a supplemental
23certification of the additional amount necessary to pay all
24principal of and interest on those general obligation bonds due
25in State fiscal years 2004 and 2005 authorized by Section
267.2(a) of the General Obligation Bond Act and issued to provide

 

 

09800SB2404sam002- 93 -LRB098 09018 EFG 45623 a

1the proceeds deposited by the State with the System in July
22003, representing deposits other than amounts reserved under
3Section 7.2(c) of the General Obligation Bond Act, as soon as
4practical after the effective date of this amendatory Act of
5the 93rd General Assembly.
6    On or before May 1, 2004, the Board shall recalculate and
7recertify to the Governor and to each department the amount of
8the required State contribution to the System and the required
9rates for State contributions to the System for State fiscal
10year 2005, taking into account the amounts appropriated to and
11received by the System under subsection (d) of Section 7.2 of
12the General Obligation Bond Act.
13    On or before July 1, 2005, the Board shall recalculate and
14recertify to the Governor and to each department the amount of
15the required State contribution to the System and the required
16rates for State contributions to the System for State fiscal
17year 2006, taking into account the changes in required State
18contributions made by this amendatory Act of the 94th General
19Assembly.
20    On or before April 1, 2011, the Board shall recalculate and
21recertify to the Governor and to each department the amount of
22the required State contribution to the System for State fiscal
23year 2011, applying the changes made by Public Act 96-889 to
24the System's assets and liabilities as of June 30, 2009 as
25though Public Act 96-889 was approved on that date.
26(Source: P.A. 96-1497, eff. 1-14-11; 96-1511, eff. 1-27-11;

 

 

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197-694, eff. 6-18-12.)
 
2    (40 ILCS 5/14-152.1)
3    Sec. 14-152.1. Application and expiration of new benefit
4increases.
5    (a) As used in this Section, "new benefit increase" means
6an increase in the amount of any benefit provided under this
7Article, or an expansion of the conditions of eligibility for
8any benefit under this Article, that results from an amendment
9to this Code that takes effect after June 1, 2005 (the
10effective date of Public Act 94-4). "New benefit increase",
11however, does not include any benefit increase resulting from
12the changes made to this Article or Article 1 by Public Act
1396-37 or this amendatory Act of the 98th 96th General Assembly.
14    (b) Notwithstanding any other provision of this Code or any
15subsequent amendment to this Code, every new benefit increase
16is subject to this Section and shall be deemed to be granted
17only in conformance with and contingent upon compliance with
18the provisions of this Section.
19    (c) The Public Act enacting a new benefit increase must
20identify and provide for payment to the System of additional
21funding at least sufficient to fund the resulting annual
22increase in cost to the System as it accrues.
23    Every new benefit increase is contingent upon the General
24Assembly providing the additional funding required under this
25subsection. The Commission on Government Forecasting and

 

 

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1Accountability shall analyze whether adequate additional
2funding has been provided for the new benefit increase and
3shall report its analysis to the Public Pension Division of the
4Department of Financial and Professional Regulation. A new
5benefit increase created by a Public Act that does not include
6the additional funding required under this subsection is null
7and void. If the Public Pension Division determines that the
8additional funding provided for a new benefit increase under
9this subsection is or has become inadequate, it may so certify
10to the Governor and the State Comptroller and, in the absence
11of corrective action by the General Assembly, the new benefit
12increase shall expire at the end of the fiscal year in which
13the certification is made.
14    (d) Every new benefit increase shall expire 5 years after
15its effective date or on such earlier date as may be specified
16in the language enacting the new benefit increase or provided
17under subsection (c). This does not prevent the General
18Assembly from extending or re-creating a new benefit increase
19by law.
20    (e) Except as otherwise provided in the language creating
21the new benefit increase, a new benefit increase that expires
22under this Section continues to apply to persons who applied
23and qualified for the affected benefit while the new benefit
24increase was in effect and to the affected beneficiaries and
25alternate payees of such persons, but does not apply to any
26other person, including without limitation a person who

 

 

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1continues in service after the expiration date and did not
2apply and qualify for the affected benefit while the new
3benefit increase was in effect.
4(Source: P.A. 96-37, eff. 7-13-09.)
 
5    (40 ILCS 5/15-106)  (from Ch. 108 1/2, par. 15-106)
6    Sec. 15-106. Employer. "Employer": The University of
7Illinois, Southern Illinois University, Chicago State
8University, Eastern Illinois University, Governors State
9University, Illinois State University, Northeastern Illinois
10University, Northern Illinois University, Western Illinois
11University, the State Board of Higher Education, the Illinois
12Mathematics and Science Academy, the University Civil Service
13Merit Board, the Board of Trustees of the State Universities
14Retirement System, the Illinois Community College Board,
15community college boards, any association of community college
16boards organized under Section 3-55 of the Public Community
17College Act, the Board of Examiners established under the
18Illinois Public Accounting Act, and, only during the period for
19which employer contributions required under Section 15-155 are
20paid, the following organizations: the alumni associations,
21the foundations and the athletic associations which are
22affiliated with the universities and colleges included in this
23Section as employers. An individual that begins employment
24after the effective date of this amendatory Act of the 98th
25General Assembly with an entity not defined as an employer in

 

 

09800SB2404sam002- 97 -LRB098 09018 EFG 45623 a

1this Section shall not be deemed an employee for the purposes
2of this Article with respect to that employment and shall not
3be eligible to participate in the System with respect to that
4employment; provided, however, that those individuals who are
5both employed and already participants in the System on the
6effective date of this amendatory Act of the 98th General
7Assembly shall be entitled to remain participants in the System
8for the duration of that employment and continue to earn
9service credit.
10    Notwithstanding any provision of law to the contrary, an
11individual who begins employment with any of the following
12employers on or after the effective date of this amendatory Act
13of the 98th General Assembly shall not be deemed an employee
14and shall not be eligible to participate in the System with
15respect to that employment: any association of community
16college boards organized under Section 3-55 of the Public
17Community College Act, the Association of Illinois
18Middle-Grade Schools, the Illinois Association of School
19Administrators, the Illinois Association for Supervision and
20Curriculum Development, the Illinois Principals Association,
21the Illinois Association of School Business Officials, or the
22Illinois Special Olympics; provided, however, that those
23individuals who are both employed and already participants in
24the System on the effective date of this amendatory Act of the
2598th General Assembly shall be entitled to remain participants
26in the System for the duration of that employment and continue

 

 

09800SB2404sam002- 98 -LRB098 09018 EFG 45623 a

1to earn service credit.
2    A department as defined in Section 14-103.04 is an employer
3for any person appointed by the Governor under the Civil
4Administrative Code of Illinois who is a participating employee
5as defined in Section 15-109. The Department of Central
6Management Services is an employer with respect to persons
7employed by the State Board of Higher Education in positions
8with the Illinois Century Network as of June 30, 2004 who
9remain continuously employed after that date by the Department
10of Central Management Services in positions with the Illinois
11Century Network, the Bureau of Communication and Computer
12Services, or, if applicable, any successor bureau.
13    The cities of Champaign and Urbana shall be considered
14employers, but only during the period for which contributions
15are required to be made under subsection (b-1) of Section
1615-155 and only with respect to individuals described in
17subsection (h) of Section 15-107.
18(Source: P.A. 95-369, eff. 8-23-07; 95-728, eff. 7-1-08 - See
19Sec. 999.)
 
20    (40 ILCS 5/15-107)  (from Ch. 108 1/2, par. 15-107)
21    Sec. 15-107. Employee.
22    (a) "Employee" means any member of the educational,
23administrative, secretarial, clerical, mechanical, labor or
24other staff of an employer whose employment is permanent and
25continuous or who is employed in a position in which services

 

 

09800SB2404sam002- 99 -LRB098 09018 EFG 45623 a

1are expected to be rendered on a continuous basis for at least
24 months or one academic term, whichever is less, who (A)
3receives payment for personal services on a warrant issued
4pursuant to a payroll voucher certified by an employer and
5drawn by the State Comptroller upon the State Treasurer or by
6an employer upon trust, federal or other funds, or (B) is on a
7leave of absence without pay. Employment which is irregular,
8intermittent or temporary shall not be considered continuous
9for purposes of this paragraph.
10    However, a person is not an "employee" if he or she:
11        (1) is a student enrolled in and regularly attending
12    classes in a college or university which is an employer,
13    and is employed on a temporary basis at less than full
14    time;
15        (2) is currently receiving a retirement annuity or a
16    disability retirement annuity under Section 15-153.2 from
17    this System;
18        (3) is on a military leave of absence;
19        (4) is eligible to participate in the Federal Civil
20    Service Retirement System and is currently making
21    contributions to that system based upon earnings paid by an
22    employer;
23        (5) is on leave of absence without pay for more than 60
24    days immediately following termination of disability
25    benefits under this Article;
26        (6) is hired after June 30, 1979 as a public service

 

 

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1    employment program participant under the Federal
2    Comprehensive Employment and Training Act and receives
3    earnings in whole or in part from funds provided under that
4    Act; or
5        (7) is employed on or after July 1, 1991 to perform
6    services that are excluded by subdivision (a)(7)(f) or
7    (a)(19) of Section 210 of the federal Social Security Act
8    from the definition of employment given in that Section (42
9    U.S.C. 410).
10    (b) Any employer may, by filing a written notice with the
11board, exclude from the definition of "employee" all persons
12employed pursuant to a federally funded contract entered into
13after July 1, 1982 with a federal military department in a
14program providing training in military courses to federal
15military personnel on a military site owned by the United
16States Government, if this exclusion is not prohibited by the
17federally funded contract or federal laws or rules governing
18the administration of the contract.
19    (c) Any person appointed by the Governor under the Civil
20Administrative Code of the State is an employee, if he or she
21is a participant in this system on the effective date of the
22appointment.
23    (d) A participant on lay-off status under civil service
24rules is considered an employee for not more than 120 days from
25the date of the lay-off.
26    (e) A participant is considered an employee during (1) the

 

 

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1first 60 days of disability leave, (2) the period, not to
2exceed one year, in which his or her eligibility for disability
3benefits is being considered by the board or reviewed by the
4courts, and (3) the period he or she receives disability
5benefits under the provisions of Section 15-152, workers'
6compensation or occupational disease benefits, or disability
7income under an insurance contract financed wholly or partially
8by the employer.
9    (f) Absences without pay, other than formal leaves of
10absence, of less than 30 calendar days, are not considered as
11an interruption of a person's status as an employee. If such
12absences during any period of 12 months exceed 30 work days,
13the employee status of the person is considered as interrupted
14as of the 31st work day.
15    (g) A staff member whose employment contract requires
16services during an academic term is to be considered an
17employee during the summer and other vacation periods, unless
18he or she declines an employment contract for the succeeding
19academic term or his or her employment status is otherwise
20terminated, and he or she receives no earnings during these
21periods.
22    (h) An individual who was a participating employee employed
23in the fire department of the University of Illinois's
24Champaign-Urbana campus immediately prior to the elimination
25of that fire department and who immediately after the
26elimination of that fire department became employed by the fire

 

 

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1department of the City of Urbana or the City of Champaign shall
2continue to be considered as an employee for purposes of this
3Article for so long as the individual remains employed as a
4firefighter by the City of Urbana or the City of Champaign. The
5individual shall cease to be considered an employee under this
6subsection (h) upon the first termination of the individual's
7employment as a firefighter by the City of Urbana or the City
8of Champaign.
9    (i) An individual who is employed on a full-time basis as
10an officer or employee of a statewide teacher organization that
11serves System participants or an officer of a national teacher
12organization that serves System participants may participate
13in the System and shall be deemed an employee, provided that
14(1) the individual has previously earned creditable service
15under this Article, (2) the individual files with the System an
16irrevocable election to become a participant before the
17effective date of this amendatory Act of the 97th General
18Assembly, (3) the individual does not receive credit for that
19employment under any other Article of this Code, and (4) the
20individual first became a full-time employee of the teacher
21organization and becomes a participant before the effective
22date of this amendatory Act of the 97th General Assembly. An
23employee under this subsection (i) is responsible for paying to
24the System both (A) employee contributions based on the actual
25compensation received for service with the teacher
26organization and (B) employer contributions equal to the normal

 

 

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1costs (as defined in Section 15-155) resulting from that
2service; all or any part of these contributions may be paid on
3the employee's behalf or picked up for tax purposes (if
4authorized under federal law) by the teacher organization.
5    A person who is an employee as defined in this subsection
6(i) may establish service credit for similar employment prior
7to becoming an employee under this subsection by paying to the
8System for that employment the contributions specified in this
9subsection, plus interest at the effective rate from the date
10of service to the date of payment. However, credit shall not be
11granted under this subsection for any such prior employment for
12which the applicant received credit under any other provision
13of this Code, or during which the applicant was on a leave of
14absence under Section 15-113.2.
15    (j) A person employed by the State Board of Higher
16Education in a position with the Illinois Century Network as of
17June 30, 2004 shall be considered to be an employee for so long
18as he or she remains continuously employed after that date by
19the Department of Central Management Services in a position
20with the Illinois Century Network, the Bureau of Communication
21and Computer Services, or, if applicable, any successor bureau
22and meets the requirements of subsection (a).
23    (k) In the case of doubt as to whether any person is an
24employee within the meaning of this Section, the decision of
25the Board shall be final.
26(Source: P.A. 97-651, eff. 1-5-12.)
 

 

 

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1    (40 ILCS 5/15-108.1 new)
2    Sec. 15-108.1. Tier I employee. "Tier I employee": An
3employee under this Article, other than a participant in the
4self-managed plan under Section 15-158.2, who first became a
5member or participant before January 1, 2011 under any
6reciprocal retirement system or pension fund established under
7this Code other than a retirement system or pension fund
8established under Article 2, 3, 4, 5, 6, or 18 of this Code.
9However, for the purposes of the election under Section
1015-132.9 and the consequences arising from that election, "Tier
11I employee" does not include a participant under this Article
12who would qualify as a Tier I employee but who has made an
13irrevocable election on or before January 1, 2013 to retire
14from service pursuant to the terms of a collective bargaining
15agreement in effect on January 1, 2013, excluding any
16extension, amendment, or renewal of that agreement on or after
17that date, and has notified the System of that election.
 
18    (40 ILCS 5/15-108.2 new)
19    Sec. 15-108.2. Tier I retiree. "Tier I retiree": A former
20Tier I employee who is receiving a retirement annuity. However,
21for the purposes of the election under Section 15-132.9 and the
22consequences arising from that election, "Tier I retiree" also
23includes a participant under this Article who would qualify as
24a Tier I employee but who has made an irrevocable election on

 

 

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1or before January 1, 2013 to retire from service pursuant to
2the terms of a collective bargaining agreement in effect on
3January 1, 2013, excluding any extension, amendment, or renewal
4of that agreement on or after that date, and has notified the
5System of that election.
6    A person does not become a Tier I retiree by virtue of
7receiving a reversionary, survivors, beneficiary or disability
8annuity.
 
9    (40 ILCS 5/15-111)  (from Ch. 108 1/2, par. 15-111)
10    Sec. 15-111. Earnings. "Earnings": An amount paid for
11personal services equal to the sum of the basic compensation
12plus extra compensation for summer teaching, overtime or other
13extra service. For periods for which an employee receives
14service credit under subsection (c) of Section 15-113.1 or
15Section 15-113.2, earnings are equal to the basic compensation
16on which contributions are paid by the employee during such
17periods. Compensation for employment which is irregular,
18intermittent and temporary shall not be considered earnings,
19unless the participant is also receiving earnings from the
20employer as an employee under Section 15-107.
21    With respect to transition pay paid by the University of
22Illinois to a person who was a participating employee employed
23in the fire department of the University of Illinois's
24Champaign-Urbana campus immediately prior to the elimination
25of that fire department:

 

 

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1        (1) "Earnings" includes transition pay paid to the
2    employee on or after the effective date of this amendatory
3    Act of the 91st General Assembly.
4        (2) "Earnings" includes transition pay paid to the
5    employee before the effective date of this amendatory Act
6    of the 91st General Assembly only if (i) employee
7    contributions under Section 15-157 have been withheld from
8    that transition pay or (ii) the employee pays to the System
9    before January 1, 2001 an amount representing employee
10    contributions under Section 15-157 on that transition pay.
11    Employee contributions under item (ii) may be paid in a
12    lump sum, by withholding from additional transition pay
13    accruing before January 1, 2001, or in any other manner
14    approved by the System. Upon payment of the employee
15    contributions on transition pay, the corresponding
16    employer contributions become an obligation of the State.
17    Notwithstanding any other provision of this Section,
18"earnings" does not include any future increase in income
19offered by an employer under this Article pursuant to the
20requirements of subsection (c) of Section 15-132.9 that is
21accepted by a Tier I employee, or a Tier I retiree returning to
22active service, who has made the election under paragraph (2)
23of subsection (a) or (a-5) of Section 15-132.9.
24(Source: P.A. 91-887, eff. 7-6-00.)
 
25    (40 ILCS 5/15-112.1 new)

 

 

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1    Sec. 15-112.1. Future increase in income. "Future increase
2in income": Any increase in income in any form offered by an
3employer to an employee under this Article after June 30, 2014
4that would qualify as "earnings", as defined in Section 15-111,
5but for the fact that the employer offered the increase in
6income to the employee on the condition that it not qualify as
7earnings and the employee accepted the increase in income
8subject to that condition. The term "future increase in income"
9does not include an increase in income in any form that is paid
10to a Tier I employee under an employment contract or collective
11bargaining agreement that is in effect on the effective date of
12this Section but does include an increase in income in any form
13pursuant to an extension, amendment, or renewal of any such
14employment contract or collective bargaining agreement on or
15after the effective date of this amendatory Act of the 98th
16General Assembly.
 
17    (40 ILCS 5/15-132.9 new)
18    Sec. 15-132.9. Election by Tier I employees and Tier I
19retirees.
20    (a) Each Tier I employee shall make an irrevocable election
21either:
22        (1) to agree to item (i) or (ii) as set forth in this
23    paragraph (1):
24            (i) to have the amount of the automatic annual
25        increases in his or her retirement annuity that are

 

 

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1        otherwise provided for in this Article calculated,
2        instead, as provided in subsection (d-1) of Section
3        15-136, and to waive his or her eligibility for 2
4        automatic annual increases in retirement annuity as
5        provided in subsection (d-2) of Section 15-157; or
6            (ii) to waive his or her eligibility for 3
7        automatic annual increases in retirement annuity, as
8        provided in subsection (d-3) of Section 15-136, and to
9        make the contributions set forth in subsection (a-5) of
10        Section 15-157; or
11        (2) to not agree to item (i) or (ii) as set forth in
12    paragraph (1) of this subsection.
13    The election required under this subsection (a) shall be
14made by each Tier I employee no earlier than February 1, 2014
15and no later than May 31, 2014, except that:
16        (i) a person who becomes a Tier I employee under this
17    Article on or after February 1, 2014 must make the election
18    under this subsection (a) within 60 days after becoming a
19    Tier I employee;
20        (ii) a person who returns to active service as a Tier I
21    employee under this Article on or after February 1, 2014
22    and has not yet made an election under this Section must
23    make the election under this subsection (a) within 60 days
24    after returning to active service as a Tier I employee; and
25        (iii) a person who made the election under subsection
26    (a-5) as a Tier I retiree remains bound by that election

 

 

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1    and shall not make a later election under this subsection
2    (a).
3    If a Tier I employee fails for any reason to make a
4required election under this subsection within the time
5specified, then the employee shall be deemed to have made the
6election under paragraph (2) of this subsection.
7    (a-5) Each Tier I retiree shall make an irrevocable
8election either:
9        (1) to agree to the following:
10            (i) to have the amount of the automatic annual
11        increases in his or her retirement annuity calculated
12        without regard to subsection (d-1), (d-2), or (d-3) of
13        Section 15-136; and
14            (ii) to waive his or her eligibility for 2
15        automatic annual increases in retirement annuity as
16        provided in subsection (d-4) of Section 15-136; or
17        (2) to not agree to items (i) and (ii) as set forth in
18    paragraph (1) of this subsection.
19    The election required under this subsection (a-5) shall be
20made by each Tier I retiree no earlier than February 1, 2014
21and no later than May 31, 2014, except that:
22        (i) a person who becomes a Tier I retiree under this
23    Article on or after February 1, 2014 must make the election
24    under this subsection (a-5) within 60 days after becoming a
25    Tier I retiree; and
26        (ii) a person who made the election under subsection

 

 

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1    (a) as a Tier I employee remains bound by that election and
2    shall not make a later election under this subsection
3    (a-5).
4    If a Tier I retiree fails for any reason to make a required
5election under this subsection within the time specified, then
6the Tier I retiree shall be deemed to have made the election
7under paragraph (2) of this subsection.
8    (a-10) All elections under subsection (a) or (a-5) that are
9made or deemed to be made before June 1, 2014 shall take effect
10on July 1, 2014. Elections that are made or deemed to be made
11on or after June 1, 2014 shall take effect on the first day of
12the month following the month in which the election is made or
13deemed to be made.
14    (b) As adequate and legal consideration provided under this
15amendatory Act of the 98th General Assembly for making an
16election under paragraph (1) of subsection (a) of this Section,
17any future increases in income offered by an employer under
18this Article to a Tier I employee who has made an election
19under paragraph (1) of subsection (a) of this Section shall be
20offered expressly and irrevocably as constituting earnings
21under Section 15-111. In addition, a Tier I employee who has
22made an election under item (i) of paragraph (1) of subsection
23(a) of this Section shall receive the right to also participate
24in the optional cash balance plan established under Section
251-162.
26    As adequate and legal consideration provided under this

 

 

09800SB2404sam002- 111 -LRB098 09018 EFG 45623 a

1amendatory Act of the 98th General Assembly for making an
2election under paragraph (1) of subsection (a-5) of this
3Section, any future increases in income offered by an employer
4under this Article to a Tier I retiree who returns to active
5service after having made the election under paragraph (1) of
6subsection (a-5) of this Section shall be offered expressly and
7irrevocably as constituting earnings under Section 15-111.
8    (c) A Tier I employee who makes the election under
9paragraph (2) of subsection (a) of this Section shall not be
10subject to either item (i) or (ii) set forth in paragraph (1)
11of subsection (a) of this Section. However, any future
12increases in income offered by an employer under this Article
13to a Tier I employee who has made the election under paragraph
14(2) of subsection (a) of this Section shall be offered by the
15employer expressly and irrevocably as not constituting
16earnings under Section 15-111, and the employee may not accept
17any future increase in income that is offered in violation of
18this requirement. In addition, a Tier I employee who has made
19the election under paragraph (2) of subsection (a) of this
20Section shall not receive the right to participate in the
21optional cash balance plan established under Section 1-162.
22    A Tier I retiree who makes the election under paragraph (2)
23of subsection (a-5) of this Section shall not be subject to
24either item (i) or (ii) set forth in paragraph (1) of
25subsection (a-5) of this Section. However, any future increases
26in income offered by an employer under this Article to a Tier I

 

 

09800SB2404sam002- 112 -LRB098 09018 EFG 45623 a

1retiree who returns to active service and has made the election
2under paragraph (2) of subsection (a-5) of this Section shall
3be offered by the employer expressly and irrevocably as not
4constituting earnings under Section 15-111, and the employee
5may not accept any future increase in income that is offered in
6violation of this requirement. In addition, a Tier I retiree
7who returns to active service and has made the election under
8paragraph (2) of subsection (a-5) of this Section shall not
9receive the right to participate in the optional cash balance
10plan established under Section 1-162.
11    (d) The System shall make a good faith effort to contact
12each Tier I employee and Tier I retiree subject to this
13Section. The System shall mail information describing the
14required election to each Tier I employee and Tier I retiree by
15United States Postal Service mail to his or her last known
16address on file with the System. If the Tier I employee or Tier
17I retiree is not responsive to other means of contact, it is
18sufficient for the System to publish the details of any
19required elections on its website or to publish those details
20in a regularly published newsletter or other existing public
21forum.
22    Tier I employees and Tier I retirees who are subject to
23this Section shall be provided with an election packet
24containing information regarding their options, as well as the
25forms necessary to make the required election. Upon request,
26the System shall offer Tier I employees and Tier I retirees an

 

 

09800SB2404sam002- 113 -LRB098 09018 EFG 45623 a

1opportunity to receive information from the System before
2making the required election. The information may consist of
3video materials, group presentations, individual consultation
4with a member or authorized representative of the System in
5person or by telephone or other electronic means, or any
6combination of those methods. The System shall not provide
7advice or counseling with respect to which election a Tier I
8employee or Tier I retiree should make or specific to the legal
9or tax circumstances of or consequences to the Tier I employee
10or Tier I retiree.
11    The System shall inform Tier I employees and Tier I
12retirees in the election packet required under this subsection
13that the Tier I employee or Tier I retiree may also wish to
14obtain information and counsel relating to the election
15required under this Section from any other available source,
16including but not limited to labor organizations and private
17counsel.
18    In no event shall the System, its staff, or the Board be
19held liable for any information given to a member, beneficiary,
20or annuitant regarding the elections under this Section. The
21System shall coordinate with the Illinois Department of Central
22Management Services and each other retirement system
23administering an election in accordance with this amendatory
24Act of the 98th General Assembly to provide information
25concerning the impact of the election set forth in this
26Section.

 

 

09800SB2404sam002- 114 -LRB098 09018 EFG 45623 a

1    (e) Notwithstanding any other provision of law, an employer
2under this Article is required to offer any future increases in
3income expressly and irrevocably as not constituting
4"earnings" under Section 15-111 to any Tier I employee, or Tier
5I retiree returning to active service, who has made an election
6under paragraph (2) of subsection (a) or (a-5) of this Section.
7A Tier I employee, or Tier I retiree returning to active
8service, who has made an election under paragraph (2) of
9subsection (a) or (a-5) of this Section shall not accept any
10future increase in income that is offered by an employer under
11this Article in violation of the requirement set forth in this
12subsection.
13    (f) A member's election under this Section is not a
14prohibited election under subdivision (j)(1) of Section 1-119
15of this Code.
16    (g) An employee who has made the election under item (i) of
17paragraph (1) of subsection (a) of this Section may elect to
18participate in the optional cash balance plan under Section
191-162.
20    The election to participate in the optional cash balance
21plan shall be made in writing, in the manner provided by the
22applicable retirement system.
23    (h) No provision of this Section shall be interpreted in a
24way that would cause the System to cease to be a qualified plan
25under Section 401(a) of the Internal Revenue Code of 1986.
26    (i) If this Section is determined to be unconstitutional or

 

 

09800SB2404sam002- 115 -LRB098 09018 EFG 45623 a

1otherwise invalid by a final unappealable decision of an
2Illinois court or a court of competent jurisdiction as applied
3to Tier I employees but not as applied to Tier I retirees, then
4this Section and the changes deriving from the election
5required under this Section shall be null and void as applied
6to Tier I employees but shall remain in full effect for Tier I
7retirees.
8    (j) If this Section is determined to be unconstitutional or
9otherwise invalid by a final unappealable decision of an
10Illinois court or a court of competent jurisdiction as applied
11to Tier I retirees but not as applied to Tier I employees, then
12this Section and the changes deriving from the election
13required under this Section shall be null and void as applied
14to Tier I retirees but shall remain in full effect for Tier I
15employees.
16    (k) If an election created by this amendatory Act in any
17other Article of this Code or any change deriving from that
18election is determined to be unconstitutional or otherwise
19invalid by a final unappealable decision of an Illinois court
20or a court of competent jurisdiction, the invalidity of that
21provision shall not in any way affect the validity of this
22Section or the changes deriving from the election required
23under this Section.
 
24    (40 ILCS 5/15-136)  (from Ch. 108 1/2, par. 15-136)
25    Sec. 15-136. Retirement annuities - Amount. The provisions

 

 

09800SB2404sam002- 116 -LRB098 09018 EFG 45623 a

1of this Section 15-136 apply only to those participants who are
2participating in the traditional benefit package or the
3portable benefit package and do not apply to participants who
4are participating in the self-managed plan.
5    (a) The amount of a participant's retirement annuity,
6expressed in the form of a single-life annuity, shall be
7determined by whichever of the following rules is applicable
8and provides the largest annuity:
9    Rule 1: The retirement annuity shall be 1.67% of final rate
10of earnings for each of the first 10 years of service, 1.90%
11for each of the next 10 years of service, 2.10% for each year
12of service in excess of 20 but not exceeding 30, and 2.30% for
13each year in excess of 30; or for persons who retire on or
14after January 1, 1998, 2.2% of the final rate of earnings for
15each year of service.
16    Rule 2: The retirement annuity shall be the sum of the
17following, determined from amounts credited to the participant
18in accordance with the actuarial tables and the effective rate
19of interest in effect at the time the retirement annuity
20begins:
21        (i) the normal annuity which can be provided on an
22    actuarially equivalent basis, by the accumulated normal
23    contributions as of the date the annuity begins;
24        (ii) an annuity from employer contributions of an
25    amount equal to that which can be provided on an
26    actuarially equivalent basis from the accumulated normal

 

 

09800SB2404sam002- 117 -LRB098 09018 EFG 45623 a

1    contributions made by the participant under Section
2    15-113.6 and Section 15-113.7 plus 1.4 times all other
3    accumulated normal contributions made by the participant;
4    and
5        (iii) the annuity that can be provided on an
6    actuarially equivalent basis from the entire contribution
7    made by the participant under Section 15-113.3.
8    For the purpose of calculating an annuity under this Rule
92, neither the contribution required under subsection (a-1) of
10Section 15-157 nor the contribution required under subsection
11(a-5) of that Section shall be considered when determining the
12participant's accumulated normal contributions under clause
13(i) or the employer contribution under clause (ii).
14    With respect to a police officer or firefighter who retires
15on or after August 14, 1998, the accumulated normal
16contributions taken into account under clauses (i) and (ii) of
17this Rule 2 shall include the additional normal contributions
18made by the police officer or firefighter under Section
1915-157(a).
20    The amount of a retirement annuity calculated under this
21Rule 2 shall be computed solely on the basis of the
22participant's accumulated normal contributions, as specified
23in this Rule and defined in Section 15-116. Neither an employee
24or employer contribution for early retirement under Section
2515-136.2 nor any other employer contribution shall be used in
26the calculation of the amount of a retirement annuity under

 

 

09800SB2404sam002- 118 -LRB098 09018 EFG 45623 a

1this Rule 2.
2    This amendatory Act of the 91st General Assembly is a
3clarification of existing law and applies to every participant
4and annuitant without regard to whether status as an employee
5terminates before the effective date of this amendatory Act.
6    This Rule 2 does not apply to a person who first becomes an
7employee under this Article on or after July 1, 2005.
8    Rule 3: The retirement annuity of a participant who is
9employed at least one-half time during the period on which his
10or her final rate of earnings is based, shall be equal to the
11participant's years of service not to exceed 30, multiplied by
12(1) $96 if the participant's final rate of earnings is less
13than $3,500, (2) $108 if the final rate of earnings is at least
14$3,500 but less than $4,500, (3) $120 if the final rate of
15earnings is at least $4,500 but less than $5,500, (4) $132 if
16the final rate of earnings is at least $5,500 but less than
17$6,500, (5) $144 if the final rate of earnings is at least
18$6,500 but less than $7,500, (6) $156 if the final rate of
19earnings is at least $7,500 but less than $8,500, (7) $168 if
20the final rate of earnings is at least $8,500 but less than
21$9,500, and (8) $180 if the final rate of earnings is $9,500 or
22more, except that the annuity for those persons having made an
23election under Section 15-154(a-1) shall be calculated and
24payable under the portable retirement benefit program pursuant
25to the provisions of Section 15-136.4.
26    Rule 4: A participant who is at least age 50 and has 25 or

 

 

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1more years of service as a police officer or firefighter, and a
2participant who is age 55 or over and has at least 20 but less
3than 25 years of service as a police officer or firefighter,
4shall be entitled to a retirement annuity of 2 1/4% of the
5final rate of earnings for each of the first 10 years of
6service as a police officer or firefighter, 2 1/2% for each of
7the next 10 years of service as a police officer or
8firefighter, and 2 3/4% for each year of service as a police
9officer or firefighter in excess of 20. The retirement annuity
10for all other service shall be computed under Rule 1.
11    For purposes of this Rule 4, a participant's service as a
12firefighter shall also include the following:
13        (i) service that is performed while the person is an
14    employee under subsection (h) of Section 15-107; and
15        (ii) in the case of an individual who was a
16    participating employee employed in the fire department of
17    the University of Illinois's Champaign-Urbana campus
18    immediately prior to the elimination of that fire
19    department and who immediately after the elimination of
20    that fire department transferred to another job with the
21    University of Illinois, service performed as an employee of
22    the University of Illinois in a position other than police
23    officer or firefighter, from the date of that transfer
24    until the employee's next termination of service with the
25    University of Illinois.
26    Rule 5: The retirement annuity of a participant who elected

 

 

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1early retirement under the provisions of Section 15-136.2 and
2who, on or before February 16, 1995, brought administrative
3proceedings pursuant to the administrative rules adopted by the
4System to challenge the calculation of his or her retirement
5annuity shall be the sum of the following, determined from
6amounts credited to the participant in accordance with the
7actuarial tables and the prescribed rate of interest in effect
8at the time the retirement annuity begins:
9        (i) the normal annuity which can be provided on an
10    actuarially equivalent basis, by the accumulated normal
11    contributions as of the date the annuity begins; and
12        (ii) an annuity from employer contributions of an
13    amount equal to that which can be provided on an
14    actuarially equivalent basis from the accumulated normal
15    contributions made by the participant under Section
16    15-113.6 and Section 15-113.7 plus 1.4 times all other
17    accumulated normal contributions made by the participant;
18    and
19        (iii) an annuity which can be provided on an
20    actuarially equivalent basis from the employee
21    contribution for early retirement under Section 15-136.2,
22    and an annuity from employer contributions of an amount
23    equal to that which can be provided on an actuarially
24    equivalent basis from the employee contribution for early
25    retirement under Section 15-136.2.
26    In no event shall a retirement annuity under this Rule 5 be

 

 

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1lower than the amount obtained by adding (1) the monthly amount
2obtained by dividing the combined employee and employer
3contributions made under Section 15-136.2 by the System's
4annuity factor for the age of the participant at the beginning
5of the annuity payment period and (2) the amount equal to the
6participant's annuity if calculated under Rule 1, reduced under
7Section 15-136(b) as if no contributions had been made under
8Section 15-136.2.
9    With respect to a participant who is qualified for a
10retirement annuity under this Rule 5 whose retirement annuity
11began before the effective date of this amendatory Act of the
1291st General Assembly, and for whom an employee contribution
13was made under Section 15-136.2, the System shall recalculate
14the retirement annuity under this Rule 5 and shall pay any
15additional amounts due in the manner provided in Section
1615-186.1 for benefits mistakenly set too low.
17    The amount of a retirement annuity calculated under this
18Rule 5 shall be computed solely on the basis of those
19contributions specifically set forth in this Rule 5. Except as
20provided in clause (iii) of this Rule 5, neither an employee
21nor employer contribution for early retirement under Section
2215-136.2, nor any other employer contribution, shall be used in
23the calculation of the amount of a retirement annuity under
24this Rule 5.
25    The General Assembly has adopted the changes set forth in
26Section 25 of this amendatory Act of the 91st General Assembly

 

 

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1in recognition that the decision of the Appellate Court for the
2Fourth District in Mattis v. State Universities Retirement
3System et al. might be deemed to give some right to the
4plaintiff in that case. The changes made by Section 25 of this
5amendatory Act of the 91st General Assembly are a legislative
6implementation of the decision of the Appellate Court for the
7Fourth District in Mattis v. State Universities Retirement
8System et al. with respect to that plaintiff.
9    The changes made by Section 25 of this amendatory Act of
10the 91st General Assembly apply without regard to whether the
11person is in service as an employee on or after its effective
12date.
13    (b) The retirement annuity provided under Rules 1 and 3
14above shall be reduced by 1/2 of 1% for each month the
15participant is under age 60 at the time of retirement. However,
16this reduction shall not apply in the following cases:
17        (1) For a disabled participant whose disability
18    benefits have been discontinued because he or she has
19    exhausted eligibility for disability benefits under clause
20    (6) of Section 15-152;
21        (2) For a participant who has at least the number of
22    years of service required to retire at any age under
23    subsection (a) of Section 15-135; or
24        (3) For that portion of a retirement annuity which has
25    been provided on account of service of the participant
26    during periods when he or she performed the duties of a

 

 

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1    police officer or firefighter, if these duties were
2    performed for at least 5 years immediately preceding the
3    date the retirement annuity is to begin.
4    (c) The maximum retirement annuity provided under Rules 1,
52, 4, and 5 shall be the lesser of (1) the annual limit of
6benefits as specified in Section 415 of the Internal Revenue
7Code of 1986, as such Section may be amended from time to time
8and as such benefit limits shall be adjusted by the
9Commissioner of Internal Revenue, and (2) 80% of final rate of
10earnings.
11    (d) Subject to the provisions of subsections (d-1), (d-2),
12(d-3), and (d-4), an An annuitant whose status as an employee
13terminates after August 14, 1969 shall receive automatic
14increases in his or her retirement annuity as follows:
15    Effective January 1 immediately following the date the
16retirement annuity begins, the annuitant shall receive an
17increase in his or her monthly retirement annuity of 0.125% of
18the monthly retirement annuity provided under Rule 1, Rule 2,
19Rule 3, Rule 4, or Rule 5, contained in this Section,
20multiplied by the number of full months which elapsed from the
21date the retirement annuity payments began to January 1, 1972,
22plus 0.1667% of such annuity, multiplied by the number of full
23months which elapsed from January 1, 1972, or the date the
24retirement annuity payments began, whichever is later, to
25January 1, 1978, plus 0.25% of such annuity multiplied by the
26number of full months which elapsed from January 1, 1978, or

 

 

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1the date the retirement annuity payments began, whichever is
2later, to the effective date of the increase.
3    The annuitant shall receive an increase in his or her
4monthly retirement annuity on each January 1 thereafter during
5the annuitant's life of 3% of the monthly annuity provided
6under Rule 1, Rule 2, Rule 3, Rule 4, or Rule 5 contained in
7this Section. The change made under this subsection by P.A.
881-970 is effective January 1, 1980 and applies to each
9annuitant whose status as an employee terminates before or
10after that date.
11    Beginning January 1, 1990, and except as provided in
12subsection (d-1), all automatic annual increases payable under
13this Section shall be calculated as a percentage of the total
14annuity payable at the time of the increase, including all
15increases previously granted under this Article.
16    The change made in this subsection by P.A. 85-1008 is
17effective January 26, 1988, and is applicable without regard to
18whether status as an employee terminated before that date.
19    (d-1) Notwithstanding any other provision of this Article,
20for a Tier I employee who made the election under item (i) of
21paragraph (1) of subsection (a) of Section 15-132.9, the amount
22of each automatic annual increase in retirement annuity
23occurring on or after the effective date of that election,
24other than the initial increase, shall be 3% of the originally
25granted retirement annuity.
26    (d-2) Notwithstanding any other provision of this Article,

 

 

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1for a Tier I employee who made the election under item (i) of
2paragraph (1) of subsection (a) of Section 15-132.9, once the
3first annual increase under this Section has been granted, the
4next 2 scheduled annual increases shall be skipped, and
5thereafter all annual increases shall be granted.
6    (d-3) Notwithstanding any other provision of this Article,
7for a Tier I employee who made the election under item (ii) of
8paragraph (1) of subsection (a) of Section 15-132.9, once the
9first annual increase under this Section has been granted, the
10next 3 scheduled annual increases shall be skipped, and
11thereafter all annual increases shall be granted.
12    (d-4) Notwithstanding any other provision of this Article,
13for a Tier I retiree who made the election under paragraph (1)
14of subsection (a-5) of Section 15-132.9:
15        (1) if the Tier I retiree has not received the first
16    annual increase under this Section as of the effective date
17    of this amendatory Act of the 98th General Assembly, then
18    once the first annual increase under this Section has been
19    granted, the next scheduled annual increase shall be
20    skipped, the following annual increase shall be granted,
21    the next annual increase shall be skipped, and thereafter
22    all annual increases shall be granted; and
23        (2) if the Tier I retiree has received the first annual
24    increase under this Section as of the effective date of
25    this amendatory Act of the 98th General Assembly, then the
26    next annual increase after that effective date shall be

 

 

09800SB2404sam002- 126 -LRB098 09018 EFG 45623 a

1    skipped, the following annual increase shall be granted,
2    the next annual increase shall be skipped, and thereafter
3    all annual increases shall be granted.
4    (e) If, on January 1, 1987, or the date the retirement
5annuity payment period begins, whichever is later, the sum of
6the retirement annuity provided under Rule 1 or Rule 2 of this
7Section and the automatic annual increases provided under the
8preceding subsection or Section 15-136.1, amounts to less than
9the retirement annuity which would be provided by Rule 3, the
10retirement annuity shall be increased as of January 1, 1987, or
11the date the retirement annuity payment period begins,
12whichever is later, to the amount which would be provided by
13Rule 3 of this Section. Such increased amount shall be
14considered as the retirement annuity in determining benefits
15provided under other Sections of this Article. This paragraph
16applies without regard to whether status as an employee
17terminated before the effective date of this amendatory Act of
181987, provided that the annuitant was employed at least
19one-half time during the period on which the final rate of
20earnings was based.
21    (f) A participant is entitled to such additional annuity as
22may be provided on an actuarially equivalent basis, by any
23accumulated additional contributions to his or her credit.
24However, the additional contributions made by the participant
25toward the automatic increases in annuity provided under this
26Section shall not be taken into account in determining the

 

 

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1amount of such additional annuity.
2    (g) If, (1) by law, a function of a governmental unit, as
3defined by Section 20-107 of this Code, is transferred in whole
4or in part to an employer, and (2) a participant transfers
5employment from such governmental unit to such employer within
66 months after the transfer of the function, and (3) the sum of
7(A) the annuity payable to the participant under Rule 1, 2, or
83 of this Section (B) all proportional annuities payable to the
9participant by all other retirement systems covered by Article
1020, and (C) the initial primary insurance amount to which the
11participant is entitled under the Social Security Act, is less
12than the retirement annuity which would have been payable if
13all of the participant's pension credits validated under
14Section 20-109 had been validated under this system, a
15supplemental annuity equal to the difference in such amounts
16shall be payable to the participant.
17    (h) On January 1, 1981, an annuitant who was receiving a
18retirement annuity on or before January 1, 1971 shall have his
19or her retirement annuity then being paid increased $1 per
20month for each year of creditable service. On January 1, 1982,
21an annuitant whose retirement annuity began on or before
22January 1, 1977, shall have his or her retirement annuity then
23being paid increased $1 per month for each year of creditable
24service.
25    (i) On January 1, 1987, any annuitant whose retirement
26annuity began on or before January 1, 1977, shall have the

 

 

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1monthly retirement annuity increased by an amount equal to 8
2per year of creditable service times the number of years that
3have elapsed since the annuity began.
4(Source: P.A. 97-933, eff. 8-10-12; 97-968, eff. 8-16-12.)
 
5    (40 ILCS 5/15-156)  (from Ch. 108 1/2, par. 15-156)
6    Sec. 15-156. Obligations of State.
7    (a) The payment of (1) the required State contributions,
8(2) all benefits granted under this system and (3) all expenses
9in connection with the administration and operation thereof are
10obligations of the State of Illinois to the extent specified in
11this Article. The accumulated employee normal, additional and
12survivors insurance contributions credited to the accounts of
13active and inactive participants shall not be used to pay the
14State's share of the obligations.
15    (b) The State shall be contractually obligated to
16contribute to the System in each State fiscal year an amount
17not less than the sum required in Section 15-155 as that
18Section existed prior to the effective date of this amendatory
19Act of the 98th General Assembly.
20    The obligations created under this subsection (b) are
21contractual obligations protected and enforceable under
22Article I, Section 16 and Article XIII, Section 5 of the
23Illinois Constitution.
24    Notwithstanding any other provision of law, if the State
25fails to pay in a State fiscal year the amount guaranteed under

 

 

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1this subsection (b), the System may bring a mandamus action in
2the Circuit Court of Champaign County to compel the State to
3make that payment, irrespective of other remedies that may be
4available to the System. It shall be the mandatory fiduciary
5obligation of the Board of the System to bring that action if
6the State fails to pay in the fiscal year the amount guaranteed
7under this subsection (b). Before commencing that action, the
8Board shall submit a voucher for contributions required under
9Section 15-155. If the State fails to pay a vouchered amount
10within 90 days after receiving a voucher for that amount, then
11the Board shall submit a written request to the Comptroller
12seeking payment of that amount. A copy of the request shall be
13filed with the Secretary of State, and the Secretary of State
14shall provide copies of the request to the Governor and General
15Assembly. No earlier than the 16th day after filing a request
16with the Secretary, but no later than the 21st day after filing
17that request, the Board may commence such an action in the
18Circuit Court. If the Board fails to commence such action on or
19before the 21st day after filing the request with the Secretary
20of State, then any Tier I employee or Tier I retiree who made
21the election under paragraph (1) of subsection (a) or (a-5) of
22Section 15-132.9 may file a mandamus action against the Board
23to compel the Board to commence its mandamus action against the
24State. This subsection (b) constitutes an express waiver of the
25State's sovereign immunity. In ordering the State to make the
26required payment, the court may order a reasonable payment

 

 

09800SB2404sam002- 130 -LRB098 09018 EFG 45623 a

1schedule to enable the State to make the required payment. The
2obligations and causes of action created under this subsection
3(b) shall be in addition to any other right or remedy otherwise
4accorded by common law, or State or federal law, and nothing in
5this subsection shall be construed to deny, abrogate, impair,
6or waive any such common law or statutory right or remedy.
7    Any payments required to be made by the State pursuant to
8this subsection (b) are expressly subordinated to the payment
9of the principal, interest, and premium, if any, on any bonded
10debt obligation of the State or any other State-created entity,
11either currently outstanding or to be issued, for which the
12source of repayment or security thereon is derived directly or
13indirectly from tax revenues collected by the State or any
14other State-created entity. Payments on such bonded
15obligations include any statutory fund transfers or other
16prefunding mechanisms or formulas set forth, now or hereafter,
17in State law or bond indentures, into debt service funds or
18accounts of the State related to such bonded obligations,
19consistent with the payment schedules associated with such
20obligations.
21(Source: P.A. 83-1440.)
 
22    (40 ILCS 5/15-157)  (from Ch. 108 1/2, par. 15-157)
23    Sec. 15-157. Employee Contributions.
24    (a) Each participating employee shall make contributions
25towards the retirement benefits payable under the retirement

 

 

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1program applicable to the employee from each payment of
2earnings applicable to employment under this system on and
3after the date of becoming a participant as follows: Prior to
4September 1, 1949, 3 1/2% of earnings; from September 1, 1949
5to August 31, 1955, 5%; from September 1, 1955 to August 31,
61969, 6%; from September 1, 1969, 6 1/2%. These contributions
7are to be considered as normal contributions for purposes of
8this Article.
9    Each participant who is a police officer or firefighter
10shall make normal contributions of 8% of each payment of
11earnings applicable to employment as a police officer or
12firefighter under this system on or after September 1, 1981,
13unless he or she files with the board within 60 days after the
14effective date of this amendatory Act of 1991 or 60 days after
15the board receives notice that he or she is employed as a
16police officer or firefighter, whichever is later, a written
17notice waiving the retirement formula provided by Rule 4 of
18Section 15-136. This waiver shall be irrevocable. If a
19participant had met the conditions set forth in Section
2015-132.1 prior to the effective date of this amendatory Act of
211991 but failed to make the additional normal contributions
22required by this paragraph, he or she may elect to pay the
23additional contributions plus compound interest at the
24effective rate. If such payment is received by the board, the
25service shall be considered as police officer service in
26calculating the retirement annuity under Rule 4 of Section

 

 

09800SB2404sam002- 132 -LRB098 09018 EFG 45623 a

115-136. While performing service described in clause (i) or
2(ii) of Rule 4 of Section 15-136, a participating employee
3shall be deemed to be employed as a firefighter for the purpose
4of determining the rate of employee contributions under this
5Section.
6    (a-1) In addition to the contributions otherwise required
7under this Article, an employee who elects to participate in
8the optional cash balance plan under Section 1-162 shall pay to
9the System for the purpose of participating in the optional
10cash balance plan a contribution of 2% of each payment of
11earnings received while he or she is a participant in the
12optional cash balance plan. These contributions shall not be
13used for the purpose of determining any benefit under this
14Article except as provided in the optional cash balance plan.
15    (a-5) In addition to the contributions otherwise required
16under this Article, each Tier I participant who made the
17election under item (ii) of paragraph (1) of subsection (a) of
18Section 15-132.9 shall also make the following contributions
19toward the retirement benefits payable under the retirement
20program applicable to the employee from each payment of
21earnings applicable to employment under this system:
22        (1) beginning July 1, 2014 and through June 30, 2015,
23    1% of earnings; and
24        (2) beginning on July 1, 2015, 2% of earnings.
25    Except as otherwise specified, these contributions are to
26be considered as normal contributions for purposes of this

 

 

09800SB2404sam002- 133 -LRB098 09018 EFG 45623 a

1Article.
2    (b) Starting September 1, 1969, each participating
3employee shall make additional contributions of 1/2 of 1% of
4earnings to finance a portion of the cost of the annual
5increases in retirement annuity provided under Section 15-136,
6except that with respect to participants in the self-managed
7plan this additional contribution shall be used to finance the
8benefits obtained under that retirement program.
9    (c) In addition to the amounts described in subsections (a)
10and (b) of this Section, each participating employee shall make
11contributions of 1% of earnings applicable under this system on
12and after August 1, 1959. The contributions made under this
13subsection (c) shall be considered as survivor's insurance
14contributions for purposes of this Article if the employee is
15covered under the traditional benefit package, and such
16contributions shall be considered as additional contributions
17for purposes of this Article if the employee is participating
18in the self-managed plan or has elected to participate in the
19portable benefit package and has completed the applicable
20one-year waiting period. Contributions in excess of $80 during
21any fiscal year beginning before August 31, 1969 and in excess
22of $120 during any fiscal year thereafter until September 1,
231971 shall be considered as additional contributions for
24purposes of this Article.
25    (d) If the board by board rule so permits and subject to
26such conditions and limitations as may be specified in its

 

 

09800SB2404sam002- 134 -LRB098 09018 EFG 45623 a

1rules, a participant may make other additional contributions of
2such percentage of earnings or amounts as the participant shall
3elect in a written notice thereof received by the board.
4    (e) That fraction of a participant's total accumulated
5normal contributions, the numerator of which is equal to the
6number of years of service in excess of that which is required
7to qualify for the maximum retirement annuity, and the
8denominator of which is equal to the total service of the
9participant, shall be considered as accumulated additional
10contributions. The determination of the applicable maximum
11annuity and the adjustment in contributions required by this
12provision shall be made as of the date of the participant's
13retirement.
14    (f) Notwithstanding the foregoing, a participating
15employee shall not be required to make contributions under this
16Section after the date upon which continuance of such
17contributions would otherwise cause his or her retirement
18annuity to exceed the maximum retirement annuity as specified
19in clause (1) of subsection (c) of Section 15-136.
20    (g) A participating employee may make contributions for the
21purchase of service credit under this Article.
22(Source: P.A. 90-32, eff. 6-27-97; 90-65, eff. 7-7-97; 90-448,
23eff. 8-16-97; 90-511, eff. 8-22-97; 90-576, eff. 3-31-98;
2490-655, eff. 7-30-98; 90-766, eff. 8-14-98.)
 
25    (40 ILCS 5/15-163)  (from Ch. 108 1/2, par. 15-163)

 

 

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1    Sec. 15-163. To consider applications and authorize
2payments.
3    To consider and pass on all certifications of employment
4and applications for annuities and benefits; to authorize the
5granting of annuities and benefits; and to limit or suspend any
6payment or payments, all in accordance with this Article.
7(Source: Laws 1963, p. 161.)
 
8    (40 ILCS 5/15-165)   (from Ch. 108 1/2, par. 15-165)
9    Sec. 15-165. To certify amounts and submit vouchers.
10    (a) The Board shall certify to the Governor on or before
11November 15 of each year through until November 15, 2011 the
12appropriation required from State funds for the purposes of
13this System for the following fiscal year. The certification
14under this subsection (a) shall include a copy of the actuarial
15recommendations upon which it is based and shall specifically
16identify the System's projected State normal cost for that
17fiscal year and the projected State cost for the self-managed
18plan for that fiscal year.
19    On or before May 1, 2004, the Board shall recalculate and
20recertify to the Governor the amount of the required State
21contribution to the System for State fiscal year 2005, taking
22into account the amounts appropriated to and received by the
23System under subsection (d) of Section 7.2 of the General
24Obligation Bond Act.
25    On or before July 1, 2005, the Board shall recalculate and

 

 

09800SB2404sam002- 136 -LRB098 09018 EFG 45623 a

1recertify to the Governor the amount of the required State
2contribution to the System for State fiscal year 2006, taking
3into account the changes in required State contributions made
4by this amendatory Act of the 94th General Assembly.
5    On or before April 1, 2011, the Board shall recalculate and
6recertify to the Governor the amount of the required State
7contribution to the System for State fiscal year 2011, applying
8the changes made by Public Act 96-889 to the System's assets
9and liabilities as of June 30, 2009 as though Public Act 96-889
10was approved on that date.
11    (a-5) On or before November 1 of each year, beginning
12November 1, 2012, the Board shall submit to the State Actuary,
13the Governor, and the General Assembly a proposed certification
14of the amount of the required State contribution to the System
15for the next fiscal year, along with all of the actuarial
16assumptions, calculations, and data upon which that proposed
17certification is based. On or before January 1 of each year,
18beginning January 1, 2013, the State Actuary shall issue a
19preliminary report concerning the proposed certification and
20identifying, if necessary, recommended changes in actuarial
21assumptions that the Board must consider before finalizing its
22certification of the required State contributions.
23    On or before January 15, 2013 and each January 15
24thereafter, the Board shall certify to the Governor and the
25General Assembly the amount of the required State contribution
26for the next fiscal year. The certification shall include a

 

 

09800SB2404sam002- 137 -LRB098 09018 EFG 45623 a

1copy of the actuarial recommendations upon which it is based
2and shall specifically identify the System's projected State
3normal cost for that fiscal year and the projected State cost
4for the self-managed plan for that fiscal year. The Board's
5certification must note, in a written response to the State
6Actuary, any deviations from the State Actuary's recommended
7changes, the reason or reasons for not following the State
8Actuary's recommended changes, and the fiscal impact of not
9following the State Actuary's recommended changes on the
10required State contribution.
11    (b) The Board shall certify to the State Comptroller or
12employer, as the case may be, from time to time, by its
13president and secretary, with its seal attached, the amounts
14payable to the System from the various funds.
15    (c) Beginning in State fiscal year 1996, on or as soon as
16possible after the 15th day of each month the Board shall
17submit vouchers for payment of State contributions to the
18System, in a total monthly amount of one-twelfth of the
19required annual State contribution certified under subsection
20(a). From the effective date of this amendatory Act of the 93rd
21General Assembly through June 30, 2004, the Board shall not
22submit vouchers for the remainder of fiscal year 2004 in excess
23of the fiscal year 2004 certified contribution amount
24determined under this Section after taking into consideration
25the transfer to the System under subsection (b) of Section
266z-61 of the State Finance Act. These vouchers shall be paid by

 

 

09800SB2404sam002- 138 -LRB098 09018 EFG 45623 a

1the State Comptroller and Treasurer by warrants drawn on the
2funds appropriated to the System for that fiscal year.
3    If in any month the amount remaining unexpended from all
4other appropriations to the System for the applicable fiscal
5year (including the appropriations to the System under Section
68.12 of the State Finance Act and Section 1 of the State
7Pension Funds Continuing Appropriation Act) is less than the
8amount lawfully vouchered under this Section, the difference
9shall be paid from the General Revenue Fund under the
10continuing appropriation authority provided in Section 1.1 of
11the State Pension Funds Continuing Appropriation Act.
12    (d) So long as the payments received are the full amount
13lawfully vouchered under this Section, payments received by the
14System under this Section shall be applied first toward the
15employer contribution to the self-managed plan established
16under Section 15-158.2. Payments shall be applied second toward
17the employer's portion of the normal costs of the System, as
18defined in subsection (f) of Section 15-155. The balance shall
19be applied toward the unfunded actuarial liabilities of the
20System.
21    (e) In the event that the System does not receive, as a
22result of legislative enactment or otherwise, payments
23sufficient to fully fund the employer contribution to the
24self-managed plan established under Section 15-158.2 and to
25fully fund that portion of the employer's portion of the normal
26costs of the System, as calculated in accordance with Section

 

 

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115-155(a-1), then any payments received shall be applied
2proportionately to the optional retirement program established
3under Section 15-158.2 and to the employer's portion of the
4normal costs of the System, as calculated in accordance with
5Section 15-155(a-1).
6(Source: P.A. 96-1497, eff. 1-14-11; 96-1511, eff. 1-27-11;
797-694, eff. 6-18-12.)
 
8    (40 ILCS 5/15-198)
9    Sec. 15-198. Application and expiration of new benefit
10increases.
11    (a) As used in this Section, "new benefit increase" means
12an increase in the amount of any benefit provided under this
13Article, or an expansion of the conditions of eligibility for
14any benefit under this Article or Article 1, that results from
15an amendment to this Code that takes effect after the effective
16date of this amendatory Act of the 94th General Assembly. "New
17benefit increase", however, does not include any benefit
18increase resulting from the changes made to this Article or
19Article 1 by this amendatory Act of the 98th General Assembly.
20    (b) Notwithstanding any other provision of this Code or any
21subsequent amendment to this Code, every new benefit increase
22is subject to this Section and shall be deemed to be granted
23only in conformance with and contingent upon compliance with
24the provisions of this Section.
25    (c) The Public Act enacting a new benefit increase must

 

 

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1identify and provide for payment to the System of additional
2funding at least sufficient to fund the resulting annual
3increase in cost to the System as it accrues.
4    Every new benefit increase is contingent upon the General
5Assembly providing the additional funding required under this
6subsection. The Commission on Government Forecasting and
7Accountability shall analyze whether adequate additional
8funding has been provided for the new benefit increase and
9shall report its analysis to the Public Pension Division of the
10Department of Financial and Professional Regulation. A new
11benefit increase created by a Public Act that does not include
12the additional funding required under this subsection is null
13and void. If the Public Pension Division determines that the
14additional funding provided for a new benefit increase under
15this subsection is or has become inadequate, it may so certify
16to the Governor and the State Comptroller and, in the absence
17of corrective action by the General Assembly, the new benefit
18increase shall expire at the end of the fiscal year in which
19the certification is made.
20    (d) Every new benefit increase shall expire 5 years after
21its effective date or on such earlier date as may be specified
22in the language enacting the new benefit increase or provided
23under subsection (c). This does not prevent the General
24Assembly from extending or re-creating a new benefit increase
25by law.
26    (e) Except as otherwise provided in the language creating

 

 

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1the new benefit increase, a new benefit increase that expires
2under this Section continues to apply to persons who applied
3and qualified for the affected benefit while the new benefit
4increase was in effect and to the affected beneficiaries and
5alternate payees of such persons, but does not apply to any
6other person, including without limitation a person who
7continues in service after the expiration date and did not
8apply and qualify for the affected benefit while the new
9benefit increase was in effect.
10(Source: P.A. 94-4, eff. 6-1-05.)
 
11    (40 ILCS 5/16-106)  (from Ch. 108 1/2, par. 16-106)
12    Sec. 16-106. Teacher. "Teacher": The following
13individuals, provided that, for employment prior to July 1,
141990, they are employed on a full-time basis, or if not
15full-time, on a permanent and continuous basis in a position in
16which services are expected to be rendered for at least one
17school term:
18        (1) Any educational, administrative, professional or
19    other staff employed in the public common schools included
20    within this system in a position requiring certification
21    under the law governing the certification of teachers;
22        (2) Any educational, administrative, professional or
23    other staff employed in any facility of the Department of
24    Children and Family Services or the Department of Human
25    Services, in a position requiring certification under the

 

 

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1    law governing the certification of teachers, and any person
2    who (i) works in such a position for the Department of
3    Corrections, (ii) was a member of this System on May 31,
4    1987, and (iii) did not elect to become a member of the
5    State Employees' Retirement System pursuant to Section
6    14-108.2 of this Code; except that "teacher" does not
7    include any person who (A) becomes a security employee of
8    the Department of Human Services, as defined in Section
9    14-110, after June 28, 2001 (the effective date of Public
10    Act 92-14), or (B) becomes a member of the State Employees'
11    Retirement System pursuant to Section 14-108.2c of this
12    Code;
13        (3) Any regional superintendent of schools, assistant
14    regional superintendent of schools, State Superintendent
15    of Education; any person employed by the State Board of
16    Education as an executive; any executive of the boards
17    engaged in the service of public common school education in
18    school districts covered under this system of which the
19    State Superintendent of Education is an ex-officio member;
20        (4) Any employee of a school board association
21    operating in compliance with Article 23 of the School Code
22    who is certificated under the law governing the
23    certification of teachers, provided that he or she becomes
24    such an employee before the effective date of this
25    amendatory Act of the 98th General Assembly;
26        (5) Any person employed by the retirement system who:

 

 

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1            (i) was an employee of and a participant in the
2        system on August 17, 2001 (the effective date of Public
3        Act 92-416), or
4            (ii) becomes an employee of the system on or after
5        August 17, 2001;
6        (6) Any educational, administrative, professional or
7    other staff employed by and under the supervision and
8    control of a regional superintendent of schools, provided
9    such employment position requires the person to be
10    certificated under the law governing the certification of
11    teachers and is in an educational program serving 2 or more
12    districts in accordance with a joint agreement authorized
13    by the School Code or by federal legislation;
14        (7) Any educational, administrative, professional or
15    other staff employed in an educational program serving 2 or
16    more school districts in accordance with a joint agreement
17    authorized by the School Code or by federal legislation and
18    in a position requiring certification under the laws
19    governing the certification of teachers;
20        (8) Any officer or employee of a statewide teacher
21    organization or officer of a national teacher organization
22    who is certified under the law governing certification of
23    teachers, provided: (i) the individual had previously
24    established creditable service under this Article, (ii)
25    the individual files with the system an irrevocable
26    election to become a member before January 5, 2012 (the

 

 

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1    effective date of Public Act 97-651) this amendatory Act of
2    the 97th General Assembly, (iii) the individual does not
3    receive credit for such service under any other Article of
4    this Code, and (iv) the individual first became an officer
5    or employee of the teacher organization and becomes a
6    member before January 5, 2012 (the effective date of Public
7    Act 97-651) this amendatory Act of the 97th General
8    Assembly;
9        (9) Any educational, administrative, professional, or
10    other staff employed in a charter school operating in
11    compliance with the Charter Schools Law who is certificated
12    under the law governing the certification of teachers; .
13        (10) Any person employed, on the effective date of this
14    amendatory Act of the 94th General Assembly, by the
15    Macon-Piatt Regional Office of Education in a
16    birth-through-age-three pilot program receiving funds
17    under Section 2-389 of the School Code who is required by
18    the Macon-Piatt Regional Office of Education to hold a
19    teaching certificate, provided that the Macon-Piatt
20    Regional Office of Education makes an election, within 6
21    months after the effective date of this amendatory Act of
22    the 94th General Assembly, to have the person participate
23    in the system. Any service established prior to the
24    effective date of this amendatory Act of the 94th General
25    Assembly for service as an employee of the Macon-Piatt
26    Regional Office of Education in a birth-through-age-three

 

 

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1    pilot program receiving funds under Section 2-389 of the
2    School Code shall be considered service as a teacher if
3    employee and employer contributions have been received by
4    the system and the system has not refunded those
5    contributions.
6    An annuitant receiving a retirement annuity under this
7Article or under Article 17 of this Code who is employed by a
8board of education or other employer as permitted under Section
916-118 or 16-150.1 is not a "teacher" for purposes of this
10Article. A person who has received a single-sum retirement
11benefit under Section 16-136.4 of this Article is not a
12"teacher" for purposes of this Article.
13(Source: P.A. 97-651, eff. 1-5-12; revised 8-3-12.)
 
14    (40 ILCS 5/16-107.1 new)
15    Sec. 16-107.1. Tier I employee. "Tier I employee": A
16teacher under this Article who first became a member or
17participant before January 1, 2011 under any reciprocal
18retirement system or pension fund established under this Code
19other than a retirement system or pension fund established
20under Article 2, 3, 4, 5, 6, or 18 of this Code. However, for
21the purposes of the election under Section 16-122.9 and the
22consequences arising from that election, "Tier I employee" does
23not include a teacher under this Article who would qualify as a
24Tier I employee but who has made an irrevocable election on or
25before January 1, 2013 to retire from service pursuant to the

 

 

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1terms of a collective bargaining agreement in effect on January
21, 2013, excluding any extension, amendment, or renewal of that
3agreement on or after that date, and has notified the System of
4that election.
 
5    (40 ILCS 5/16-107.2 new)
6    Sec. 16-107.2. Tier I retiree. "Tier I retiree": A former
7Tier I employee who is receiving a retirement annuity. However,
8for the purposes of the election under Section 16-122.9 and the
9consequences arising from that election, "Tier I retiree" also
10includes a teacher under this Article who would qualify as a
11Tier I employee but who has made an irrevocable election on or
12before January 1, 2013 to retire from service pursuant to the
13terms of a collective bargaining agreement in effect on January
141, 2013, excluding any extension, amendment, or renewal of that
15agreement on or after that date, and has notified the System of
16that election.
 
17    (40 ILCS 5/16-121)  (from Ch. 108 1/2, par. 16-121)
18    Sec. 16-121. Salary. "Salary": The actual compensation
19received by a teacher during any school year and recognized by
20the system in accordance with rules of the board. For purposes
21of this Section, "school year" includes the regular school term
22plus any additional period for which a teacher is compensated
23and such compensation is recognized by the rules of the board.
24    Notwithstanding any other provision of this Section,

 

 

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1"salary" does not include any future increase in income offered
2by an employer under this Article pursuant to the requirements
3of subsection (c) of Section 16-122.9 that is accepted by a
4Tier I employee, or a Tier I retiree returning to active
5service, who has made the election under paragraph (2) of
6subsection (a) or (a-5) of Section 16-122.9.
7(Source: P.A. 84-1028.)
 
8    (40 ILCS 5/16-121.1 new)
9    Sec. 16-121.1. Future increase in income. "Future increase
10in income": Any increase in income in any form offered by an
11employer to a teacher under this Article after June 30, 2014
12that would qualify as "salary", as defined in Section 16-121,
13but for the fact that the employer offered the increase in
14income to the employee on the condition that it not qualify as
15compensation and the employee accepted the increase in income
16subject to that condition. The term "future increase in income"
17does not include an increase in income in any form that is paid
18to a Tier I employee under an employment contract or collective
19bargaining agreement that is in effect on the effective date of
20this Section but does include an increase in income in any form
21pursuant to an extension, amendment, or renewal of any such
22employment contract or collective bargaining agreement on or
23after the effective date of this amendatory Act of the 98th
24General Assembly.
 

 

 

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1    (40 ILCS 5/16-122.9 new)
2    Sec. 16-122.9. Election by Tier I employees.
3    (a) Each Tier I employee shall make an irrevocable election
4either:
5        (1) to agree to item (i) or (ii) as set forth in this
6    paragraph (1):
7            (i) to have the amount of the automatic annual
8        increases in his or her retirement annuity that are
9        otherwise provided for in this Article calculated,
10        instead, as provided in subsection (a-1) of Section
11        16-133.1 or subsection (b-1) of Section 16-136.1,
12        whichever is applicable, and to waive his or her
13        eligibility for 2 automatic annual increases in
14        retirement annuity, as provided in subsection (a-2) of
15        Section 16-133.1 or subsection (b-2) of Section
16        16-136.1, whichever is applicable; or
17            (ii) to waive his or her eligibility for 3
18        automatic annual increases in retirement annuity, as
19        provided in subsection (a-3) of Section 16-133.1 or
20        subsection (b-3) of Section 16-136.1, whichever is
21        applicable, and to make the contributions set forth in
22        subsection (a-5) of Section 16-152; or
23        (2) to not agree to item (i) or (ii) as set forth in
24    paragraph (1) of this subsection.
25    The election required under this subsection (a) shall be
26made by each Tier I employee no earlier than February 1, 2014

 

 

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1and no later than May 31, 2014, except that:
2        (i) a person who becomes a Tier I employee under this
3    Article on or after February 1, 2014 must make the election
4    under this subsection (a) within 60 days after becoming a
5    Tier I employee; and
6        (ii) a person who returns to active service as a Tier I
7    employee under this Article on or after February 1, 2014
8    and has not yet made an election under this Section must
9    make the election under this subsection (a) within 60 days
10    after returning to active service as a Tier I employee; and
11        (iii) a person who made the election under subsection
12    (a-5) as a Tier I retiree remains bound by that election
13    and shall not make a later election under this subsection
14    (a).
15    If a Tier I employee fails for any reason to make a
16required election under this subsection within the time
17specified, then the employee shall be deemed to have made the
18election under paragraph (2) of this subsection.
19    (a-5) Each Tier I retiree shall make an irrevocable
20election either:
21        (1) to agree to the following:
22            (i) to have the amount of the automatic annual
23        increases in his or her retirement annuity calculated
24        without regard to subsection (a-1), (a-2), or (a-3) of
25        Section 16-133.1 or subsection (b-1), (b-2), or (b-3)
26        of Section 16-136.1, whichever is applicable; and

 

 

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1            (ii) to waive his or her eligibility for 2
2        automatic annual increases in retirement annuity, as
3        provided in subsection (a-4) of Section 16-133.1 or
4        subsection (b-4) of Section 16-136.1, whichever is
5        applicable; or
6        (2) to not agree to items (i) and (ii) as set forth in
7    paragraph (1) of this subsection.
8    The election required under this subsection (a-5) shall be
9made by each Tier I retiree no earlier than February 1, 2014
10and no later than May 31, 2014, except that:
11        (i) a person who becomes a Tier I retiree under this
12    Article on or after February 1, 2014 must make the election
13    under this subsection (a-5) within 60 days after becoming a
14    Tier I retiree; and
15        (ii) a person who made the election under subsection
16    (a) as a Tier I employee remains bound by that election and
17    shall not make a later election under this subsection
18    (a-5).
19    If a Tier I retiree fails for any reason to make a required
20election under this subsection within the time specified, then
21the Tier I retiree shall be deemed to have made the election
22under paragraph (2) of this subsection.
23    (a-10) All elections under subsection (a) that are made or
24deemed to be made before June 1, 2014 shall take effect on July
251, 2014. Elections that are made or deemed to be made on or
26after June 1, 2014 shall take effect on the first day of the

 

 

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1month following the month in which the election is made or
2deemed to be made.
3    (b) As adequate and legal consideration provided under this
4amendatory Act of the 98th General Assembly for making an
5election under paragraph (1) of subsection (a) of this Section,
6any future increases in income offered by an employer under
7this Article to a Tier I employee who has made an election
8under paragraph (1) of subsection (a) of this Section shall be
9offered expressly and irrevocably as constituting salary under
10Section 16-121. In addition, a Tier I employee who has made an
11election under item (i) of paragraph (1) of subsection (a) of
12this Section shall receive the right to also participate in the
13optional cash balance plan established under Section 1-162.
14Finally, a Tier I employee, other than a Tier I retiree
15returning to active service as a Tier I employee, who has made
16an election under item (i) of paragraph (1) of subsection (a)
17of this Section shall receive the right to the early retirement
18without discount option set forth in Section 16-133.6.
19    As adequate and legal consideration provided under this
20amendatory Act of the 98th General Assembly for making an
21election under paragraph (1) of subsection (a-5) of this
22Section, any future increases in income offered by an employer
23under this Article to a Tier I retiree who returns to active
24service after having made an election under paragraph (1) of
25subsection (a-5) of this Section shall be offered expressly and
26irrevocably as constituting salary under Section 16-121.

 

 

09800SB2404sam002- 152 -LRB098 09018 EFG 45623 a

1    (c) A Tier I employee who makes the election under
2paragraph (2) of subsection (a) of this Section shall not be
3subject to either item (i) or (ii) set forth in paragraph (1)
4of subsection (a) of this Section. However, any future
5increases in income offered by an employer under this Article
6to a Tier I employee who has made the election under paragraph
7(2) of subsection (a) of this Section shall be offered by the
8employer expressly and irrevocably as not constituting salary
9under Section 16-121, and the employee may not accept any
10future increase in income that is offered in violation of this
11requirement. In addition, a Tier I employee who has made the
12election under paragraph (2) of subsection (a) of this Section
13shall not receive the right to participate in the optional cash
14balance plan established under Section 1-162. Finally, a Tier I
15employee who has made the election under paragraph (2) of
16subsection (a) of this Section shall not receive the right to
17the early retirement without discount option set forth in
18Section 16-133.6.
19    A Tier I retiree who makes the election under paragraph (2)
20of subsection (a-5) of this Section shall not be subject to
21either item (i) or (ii) set forth in paragraph (1) of
22subsection (a-5) of this Section. However, any future increases
23in income offered by an employer under this Article to a Tier I
24retiree who returns to active service and has made the election
25under paragraph (2) of subsection (a-5) of this Section shall
26be offered by the employer expressly and irrevocably as not

 

 

09800SB2404sam002- 153 -LRB098 09018 EFG 45623 a

1constituting salary under Section 16-121, and the employee may
2not accept any future increase in income that is offered in
3violation of this requirement. In addition, a Tier I retiree
4who returns to active service and has made the election under
5paragraph (2) of subsection (a) of this Section shall not
6receive the right to participate in the optional cash balance
7plan established under Section 1-162.
8    (d) The System shall make a good faith effort to contact
9each Tier I employee and Tier I retiree subject to this
10Section. The System shall mail information describing the
11required election to each Tier I employee and Tier I retiree by
12United States Postal Service mail to his or her last known
13address on file with the System. If the Tier I employee or Tier
14I retiree is not responsive to other means of contact, it is
15sufficient for the System to publish the details of any
16required elections on its website or to publish those details
17in a regularly published newsletter or other existing public
18forum.
19    Tier I employees and Tier I retirees who are subject to
20this Section shall be provided with an election packet
21containing information regarding their options, as well as the
22forms necessary to make the required election. Upon request,
23the System shall offer Tier I employees and Tier I retirees an
24opportunity to receive information from the System before
25making the required election. The information may consist of
26video materials, group presentations, individual consultation

 

 

09800SB2404sam002- 154 -LRB098 09018 EFG 45623 a

1with a member or authorized representative of the System in
2person or by telephone or other electronic means, or any
3combination of those methods. The System shall not provide
4advice or counseling with respect to which election a Tier I
5employee or Tier I retiree should make or specific to the legal
6or tax circumstances of or consequences to the Tier I employee
7or Tier I retiree.
8    The System shall inform Tier I employees and Tier I
9retirees in the election packet required under this subsection
10that the Tier I employee or Tier I retiree may also wish to
11obtain information and counsel relating to the election
12required under this Section from any other available source,
13including but not limited to labor organizations and private
14counsel.
15    In no event shall the System, its staff, or the Board be
16held liable for any information given to a member, beneficiary,
17or annuitant regarding the elections under this Section. The
18System shall coordinate with the Illinois Department of Central
19Management Services and each other retirement system
20administering an election in accordance with this amendatory
21Act of the 98th General Assembly to provide information
22concerning the impact of the election set forth in this
23Section.
24    (e) Notwithstanding any other provision of law, an employer
25under this Article is required to offer any future increases in
26income expressly and irrevocably as not constituting "salary"

 

 

09800SB2404sam002- 155 -LRB098 09018 EFG 45623 a

1under Section 16-121 to any Tier I employee, or Tier I retiree
2returning to active service, who has made an election under
3paragraph (2) of subsection (a) or (a-5) of Section 16-122.9. A
4Tier I employee, or Tier I retiree returning to active service,
5who has made an election under paragraph (2) of subsection (a)
6or (a-5) of Section 16-122.9 shall not accept any future
7increase in income that is offered by an employer under this
8Article in violation of the requirement set forth in this
9subsection.
10    (f) A member's election under this Section is not a
11prohibited election under subdivision (j)(1) of Section 1-119
12of this Code.
13    (g) An employee who has made the election under item (i) of
14paragraph (1) of subsection (a) of this Section may elect to
15participate in the optional cash balance plan under Section
161-162.
17    The election to participate in the optional cash balance
18plan shall be made in writing, in the manner provided by the
19applicable retirement system.
20    (h) No provision of this Section shall be interpreted in a
21way that would cause the System to cease to be a qualified plan
22under Section 401(a) of the Internal Revenue Code of 1986.
23    (i) If this Section is determined to be unconstitutional or
24otherwise invalid by a final unappealable decision of an
25Illinois court or a court of competent jurisdiction as applied
26to Tier I employees but not as applied to Tier I retirees, then

 

 

09800SB2404sam002- 156 -LRB098 09018 EFG 45623 a

1this Section and the changes deriving from the election
2required under this Section shall be null and void as applied
3to Tier I employees but shall remain in full effect for Tier I
4retirees.
5    (j) If this Section is determined to be unconstitutional or
6otherwise invalid by a final unappealable decision of an
7Illinois court or a court of competent jurisdiction as applied
8to Tier I retirees but not as applied to Tier I employees, then
9this Section and the changes deriving from the election
10required under this Section shall be null and void as applied
11to Tier I retirees but shall remain in full effect for Tier I
12employees.
13    (k) If an election created by this amendatory Act in any
14other Article of this Code or any change deriving from that
15election is determined to be unconstitutional or otherwise
16invalid by a final unappealable decision of an Illinois court
17or a court of competent jurisdiction, the invalidity of that
18provision shall not in any way affect the validity of this
19Section or the changes deriving from the election required
20under this Section.
 
21    (40 ILCS 5/16-133)  (from Ch. 108 1/2, par. 16-133)
22    Sec. 16-133. Retirement annuity; amount.
23    (a) The amount of the retirement annuity shall be (i) in
24the case of a person who first became a teacher under this
25Article before July 1, 2005, the larger of the amounts

 

 

09800SB2404sam002- 157 -LRB098 09018 EFG 45623 a

1determined under paragraphs (A) and (B) below, or (ii) in the
2case of a person who first becomes a teacher under this Article
3on or after July 1, 2005, the amount determined under the
4applicable provisions of paragraph (B):
5        (A) An amount consisting of the sum of the following:
6            (1) An amount that can be provided on an
7        actuarially equivalent basis by the member's
8        accumulated contributions at the time of retirement;
9        and
10            (2) The sum of (i) the amount that can be provided
11        on an actuarially equivalent basis by the member's
12        accumulated contributions representing service prior
13        to July 1, 1947, and (ii) the amount that can be
14        provided on an actuarially equivalent basis by the
15        amount obtained by multiplying 1.4 times the member's
16        accumulated contributions covering service subsequent
17        to June 30, 1947; and
18            (3) If there is prior service, 2 times the amount
19        that would have been determined under subparagraph (2)
20        of paragraph (A) above on account of contributions
21        which would have been made during the period of prior
22        service creditable to the member had the System been in
23        operation and had the member made contributions at the
24        contribution rate in effect prior to July 1, 1947.
25    For the purpose of calculating an annuity under this Rule
26    2, neither the contribution required under subsection

 

 

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1    (a-1) of Section 16-152 nor the contribution required under
2    subsection (a-5) of that Section shall be considered when
3    determining the participant's accumulated normal
4    contributions under clause (i) or the employer
5    contribution under clause (ii).
6        This paragraph (A) does not apply to a person who first
7    becomes a teacher under this Article on or after July 1,
8    2005.
9        (B) An amount consisting of the greater of the
10    following:
11            (1) For creditable service earned before July 1,
12        1998 that has not been augmented under Section
13        16-129.1: 1.67% of final average salary for each of the
14        first 10 years of creditable service, 1.90% of final
15        average salary for each year in excess of 10 but not
16        exceeding 20, 2.10% of final average salary for each
17        year in excess of 20 but not exceeding 30, and 2.30% of
18        final average salary for each year in excess of 30; and
19            For creditable service earned on or after July 1,
20        1998 by a member who has at least 24 years of
21        creditable service on July 1, 1998 and who does not
22        elect to augment service under Section 16-129.1: 2.2%
23        of final average salary for each year of creditable
24        service earned on or after July 1, 1998 but before the
25        member reaches a total of 30 years of creditable
26        service and 2.3% of final average salary for each year

 

 

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1        of creditable service earned on or after July 1, 1998
2        and after the member reaches a total of 30 years of
3        creditable service; and
4            For all other creditable service: 2.2% of final
5        average salary for each year of creditable service; or
6            (2) 1.5% of final average salary for each year of
7        creditable service plus the sum $7.50 for each of the
8        first 20 years of creditable service.
9    The amount of the retirement annuity determined under this
10    paragraph (B) shall be reduced by 1/2 of 1% for each month
11    that the member is less than age 60 at the time the
12    retirement annuity begins. However, this reduction shall
13    not apply (i) if the member has at least 35 years of
14    creditable service, or (ii) if the member retires on
15    account of disability under Section 16-149.2 of this
16    Article with at least 20 years of creditable service, or
17    (iii) if the member (1) has earned during the period
18    immediately preceding the last day of service at least one
19    year of contributing creditable service as an employee of a
20    department as defined in Section 14-103.04, (2) has earned
21    at least 5 years of contributing creditable service as an
22    employee of a department as defined in Section 14-103.04,
23    (3) retires on or after January 1, 2001, and (4) retires
24    having attained an age which, when added to the number of
25    years of his or her total creditable service, equals at
26    least 85. Portions of years shall be counted as decimal

 

 

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1    equivalents.
2    (b) For purposes of this Section, final average salary
3shall be the average salary for the highest 4 consecutive years
4within the last 10 years of creditable service as determined
5under rules of the board. The minimum final average salary
6shall be considered to be $2,400 per year.
7    In the determination of final average salary for members
8other than elected officials and their appointees when such
9appointees are allowed by statute, that part of a member's
10salary for any year beginning after June 30, 1979 which exceeds
11the member's annual full-time salary rate with the same
12employer for the preceding year by more than 20% shall be
13excluded. The exclusion shall not apply in any year in which
14the member's creditable earnings are less than 50% of the
15preceding year's mean salary for downstate teachers as
16determined by the survey of school district salaries provided
17in Section 2-3.103 of the School Code.
18    (c) In determining the amount of the retirement annuity
19under paragraph (B) of this Section, a fractional year shall be
20granted proportional credit.
21    (d) The retirement annuity determined under paragraph (B)
22of this Section shall be available only to members who render
23teaching service after July 1, 1947 for which member
24contributions are required, and to annuitants who re-enter
25under the provisions of Section 16-150.
26    (e) The maximum retirement annuity provided under

 

 

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1paragraph (B) of this Section shall be 75% of final average
2salary.
3    (f) A member retiring after the effective date of this
4amendatory Act of 1998 shall receive a pension equal to 75% of
5final average salary if the member is qualified to receive a
6retirement annuity equal to at least 74.6% of final average
7salary under this Article or as proportional annuities under
8Article 20 of this Code.
9(Source: P.A. 94-4, eff. 6-1-05.)
 
10    (40 ILCS 5/16-133.1)  (from Ch. 108 1/2, par. 16-133.1)
11    Sec. 16-133.1. Automatic annual increase in annuity.
12    (a) Each member with creditable service and retiring on or
13after August 26, 1969 is entitled to the automatic annual
14increases in annuity provided under this Section while
15receiving a retirement annuity or disability retirement
16annuity from the system.
17    An annuitant shall first be entitled to an initial increase
18under this Section on the January 1 next following the first
19anniversary of retirement, or January 1 of the year next
20following attainment of age 61, whichever is later. At such
21time, the system shall pay an initial increase determined as
22follows:
23        (1) 1.5% of the originally granted retirement annuity
24    or disability retirement annuity multiplied by the number
25    of years elapsed, if any, from the date of retirement until

 

 

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1    January 1, 1972, plus
2        (2) 2% of the originally granted annuity multiplied by
3    the number of years elapsed, if any, from the date of
4    retirement or January 1, 1972, whichever is later, until
5    January 1, 1978, plus
6        (3) 3% of the originally granted annuity multiplied by
7    the number of years elapsed from the date of retirement or
8    January 1, 1978, whichever is later, until the effective
9    date of the initial increase.
10However, the initial annual increase calculated under this
11Section for the recipient of a disability retirement annuity
12granted under Section 16-149.2 shall be reduced by an amount
13equal to the total of all increases in that annuity received
14under Section 16-149.5 (but not exceeding 100% of the amount of
15the initial increase otherwise provided under this Section).
16    Except as otherwise provided in subsection (a-1), (a-2),
17(a-3), or (a-4), if applicable, following Following the initial
18increase, automatic annual increases in annuity shall be
19payable on each January 1 thereafter during the lifetime of the
20annuitant, determined as a percentage of the originally granted
21retirement annuity or disability retirement annuity for
22increases granted prior to January 1, 1990, and calculated as a
23percentage of the total amount of annuity, including previous
24increases under this Section, for increases granted on or after
25January 1, 1990, as follows: 1.5% for periods prior to January
261, 1972, 2% for periods after December 31, 1971 and prior to

 

 

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1January 1, 1978, and 3% for periods after December 31, 1977.
2    (a-1) Notwithstanding any other provision of this Article,
3for a Tier I employee who made the election under item (i) of
4paragraph (1) of subsection (a) of Section 16-122.9, the amount
5of each automatic annual increase in retirement annuity
6occurring on or after the effective date of that election,
7other than the initial increase, shall be 3% of the originally
8granted retirement annuity.
9    (a-2) Notwithstanding any other provision of this Article,
10for a Tier I employee who made the election under item (i) of
11paragraph (1) of subsection (a) of Section 16-122.9, once the
12initial annual increase under this Section has been granted,
13the next 2 scheduled annual increases shall be skipped, and
14thereafter all annual increases shall be granted.
15    (a-3) Notwithstanding any other provision of this Article,
16for a Tier I employee who made the election under item (ii) of
17paragraph (1) of subsection (a) of Section 16-122.9 once the
18first annual increase under this Section has been granted, the
19next 3 scheduled annual increases shall be skipped, and
20thereafter all annual increases shall be granted.
21    (a-4) Notwithstanding any other provision of this Article,
22for a Tier I retiree who made the election under paragraph (1)
23of subsection (a-5) of Section 16-122.9:
24        (1) if the Tier I retiree has not received the initial
25    annual increase under this Section as of the effective date
26    of this amendatory Act of the 98th General Assembly, then

 

 

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1    once the initial annual increase under this Section has
2    been granted, the next scheduled annual increase shall be
3    skipped, the following annual increase shall be granted,
4    the next annual increase shall be skipped, and thereafter
5    all annual increases shall be granted; and
6        (2) if the Tier I retiree has received the initial
7    annual increase under this Section as of the effective date
8    of this amendatory Act of the 98th General Assembly, then
9    the next annual increase after that effective date shall be
10    skipped, the following annual increase shall be granted,
11    the next annual increase shall be skipped, and thereafter
12    all annual increases shall be granted.
13    (b) The automatic annual increases in annuity provided
14under this Section shall not be applicable unless a member has
15made contributions toward such increases for a period
16equivalent to one full year of creditable service. If a member
17contributes for service performed after August 26, 1969 but the
18member becomes an annuitant before such contributions amount to
19one full year's contributions based on the salary at the date
20of retirement, he or she may pay the necessary balance of the
21contributions to the system and be eligible for the automatic
22annual increases in annuity provided under this Section.
23    (c) Each member shall make contributions toward the cost of
24the automatic annual increases in annuity as provided under
25Section 16-152.
26    (d) An annuitant receiving a retirement annuity or

 

 

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1disability retirement annuity on July 1, 1969, who subsequently
2re-enters service as a teacher is eligible for the automatic
3annual increases in annuity provided under this Section if he
4or she renders at least one year of creditable service
5following the latest re-entry.
6    (e) In addition to the automatic annual increases in
7annuity provided under this Section, an annuitant who meets the
8service requirements of this Section and whose retirement
9annuity or disability retirement annuity began on or before
10January 1, 1971 shall receive, on January 1, 1981, an increase
11in the annuity then being paid of one dollar per month for each
12year of creditable service. On January 1, 1982, an annuitant
13whose retirement annuity or disability retirement annuity
14began on or before January 1, 1977 shall receive an increase in
15the annuity then being paid of one dollar per month for each
16year of creditable service.
17    On January 1, 1987, any annuitant whose retirement annuity
18began on or before January 1, 1977, shall receive an increase
19in the monthly retirement annuity equal to 8 per year of
20creditable service times the number of years that have elapsed
21since the annuity began.
22(Source: P.A. 91-927, eff. 12-14-00.)
 
23    (40 ILCS 5/16-133.6 new)
24    Sec. 16-133.6. Optional teacher early retirement without
25discount. A Tier I employee who makes an election under item

 

 

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1(i) of paragraph (1) of subsection (a) of Section 16-122.9,
2retires on or after the beginning of the first State fiscal
3year to occur after the end of the election period specified in
4Section 16-122.9, and applies for a retirement annuity within 6
5months of the last day of teaching for which retirement
6contributions were required may elect, at the time of
7application for a retirement annuity, to make a one-time member
8contribution to the System and, thereby, avoid the reduction in
9the retirement annuity for retirement before age 60 specified
10in paragraph (B) of Section 16-133. The exercise of the
11election shall also obligate the last employer to make a
12one-time nonrefundable contribution to the System. Substitute
13teachers wishing to exercise this election must teach 85 or
14more days in one school term with one employer, who shall be
15deemed the last employer for purposes of this Section. The last
16day of teaching with that employer must be within 6 months of
17the date of application for retirement. All substitute teaching
18credit applied toward the required 85 days must be earned after
19June 30, 1990.
20    The one-time member and employer contributions shall be a
21percentage of the cost of this benefit as determined by the
22System. However, when determining the one-time member and
23employer contributions, that part of a member's salary with the
24same employer which exceeds the annual salary rate for the
25preceding year by more than 20% shall be excluded. The member
26contribution shall be at the rate of 50% of the cost of the

 

 

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1benefits as determined by the System. The employer contribution
2shall be at the rate of 50% of the cost of the benefits as
3determined by the System.
4    Upon receipt of the application and election, the System
5shall determine the one-time employee and employer
6contributions required. The member contribution shall be
7credited to the individual account of the member and the
8employer contribution shall be credited to the Benefit Trust
9Reserve. The avoidance of the reduction in retirement annuity
10provided under this Section is not applicable until the
11member's contribution, if any, has been received by the System;
12however, the date that contribution is received shall not be
13considered in determining the effective date of retirement.
14    The number of members working for a single employer who may
15retire under this Section in any year may be limited at the
16option of the employer to a specified percentage of those
17eligible, not less than 10%, with the right to participate to
18be allocated among those applying on the basis of seniority in
19the service of the employer.
 
20    (40 ILCS 5/16-136.1)  (from Ch. 108 1/2, par. 16-136.1)
21    Sec. 16-136.1. Annual increase for certain annuitants.
22    (a) Any annuitant receiving a retirement annuity on June
2330, 1969 and any member retiring after June 30, 1969 shall be
24eligible for the annual increases provided under this Section
25provided the annuitant is ineligible for the automatic annual

 

 

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1increase in annuity provided under Section 16-133.1, and
2provided further that (1) retirement occurred at age 55 or over
3and was based on 5 or more years of creditable service or (2)
4if retirement occurred prior to age 55, the retirement annuity
5was based on 20 or more years of creditable service.
6    (b) An annuitant entitled to increases under this Section
7shall be entitled to the initial increase as of the later of:
8(1) January 1 following attainment of age 65, (2) January 1
9following the first anniversary of retirement, or (3) the first
10day of the month following receipt of the required qualifying
11contribution from the annuitant. The initial monthly increase
12shall be computed on the basis of the period elapsed between
13the later of the date of last retirement or attainment of age
1450 and the date of qualification for the initial increase, at
15the rate of 1 1/2% of the original monthly retirement annuity
16per year for periods prior to September 1, 1971, and at the
17rate of 2% per year for periods between September 1, 1971 and
18September 1, 1978, and at the rate of 3% per year for periods
19thereafter.
20    Except as otherwise provided in subsection (b-1), (b-2),
21(b-3), or (b-4), if applicable, an An annuitant who has
22received an initial increase under this Section, shall be
23entitled, on each January 1 following the granting of the
24initial increase, to an increase of 3% of the original monthly
25retirement annuity for increases granted prior to January 1,
261990, and equal to 3% of the total annuity, including previous

 

 

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1increases under this Section, for increases granted on or after
2January 1, 1990. The original monthly retirement annuity for
3computations under this subsection (b) shall be considered to
4be $83.34 for any annuitant entitled to benefits under Section
516-134. The minimum original disability retirement annuity for
6computations under this subsection (b) shall be considered to
7be $33.34 per month for any annuitant retired on account of
8disability.
9    (b-1) Notwithstanding any other provision of this Article,
10for a Tier I employee who made the election under item (i) of
11paragraph (1) of subsection (a) of Section 16-122.9, the amount
12of each automatic annual increase in retirement annuity
13occurring on or after the effective date of that election,
14other than the initial increase, shall be 3% of the originally
15granted retirement annuity.
16    (b-2) Notwithstanding any other provision of this Article,
17for a Tier I employee who made the election under item (i) of
18paragraph (1) of subsection (a) of Section 16-122.9, once the
19initial annual increase under this Section has been granted,
20the next 2 scheduled annual increases shall be skipped, and
21thereafter all annual increases shall be granted.
22    (b-3) Notwithstanding any other provision of this Article,
23for a Tier I employee who made the election under item (ii) of
24paragraph (1) of subsection (a) of Section 16-122.9, once the
25first annual increase under this Section has been granted, the
26next 3 scheduled annual increases shall be skipped, and

 

 

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1thereafter all annual increases shall be granted.
2    (b-4) Notwithstanding any other provision of this Article,
3for a Tier I retiree who made the election under paragraph (1)
4of subsection (a-5) of Section 16-122.9:
5        (1) if the Tier I retiree has not received the initial
6    annual increase under this Section as of the effective date
7    of this amendatory Act of the 98th General Assembly, then
8    once the initial annual increase under this Section has
9    been granted, the next scheduled annual increase shall be
10    skipped, the following annual increase shall be granted,
11    the next annual increase shall be skipped, and thereafter
12    all annual increases shall be granted; and
13        (2) if the Tier I retiree has received the initial
14    annual increase under this Section as of the effective date
15    of this amendatory Act of the 98th General Assembly, then
16    the next annual increase after that effective date shall be
17    skipped, the following annual increase shall be granted,
18    the next annual increase shall be skipped, and thereafter
19    all annual increases shall be granted.
20    (c) An annuitant who otherwise qualifies for annual
21increases under this Section must make a one-time payment of 1%
22of the monthly final average salary for each full year of the
23creditable service forming the basis of the retirement annuity
24or, if the retirement annuity was not computed using final
25average salary, 1% of the original monthly retirement annuity
26for each full year of service forming the basis of the

 

 

09800SB2404sam002- 171 -LRB098 09018 EFG 45623 a

1retirement annuity.
2    (d) In addition to other increases which may be provided by
3this Section, regardless of creditable service, annuitants not
4meeting the service requirements of Section 16-133.1 and whose
5retirement annuity began on or before January 1, 1971 shall
6receive, on January 1, 1981, an increase in the retirement
7annuity then being paid of one dollar per month for each year
8of creditable service forming the basis of the retirement
9allowance. On January 1, 1982, annuitants whose retirement
10annuity began on or before January 1, 1977, shall receive an
11increase in the retirement annuity then being paid of one
12dollar per month for each year of creditable service.
13    On January 1, 1987, any annuitant whose retirement annuity
14began on or before January 1, 1977, shall receive an increase
15in the monthly retirement annuity equal to 8 per year of
16creditable service times the number of years that have elapsed
17since the annuity began.
18(Source: P.A. 86-273.)
 
19    (40 ILCS 5/16-152)  (from Ch. 108 1/2, par. 16-152)
20    Sec. 16-152. Contributions by members.
21    (a) Each member shall make contributions for membership
22service to this System as follows:
23        (1) Effective July 1, 1998, contributions of 7.50% of
24    salary towards the cost of the retirement annuity. Such
25    contributions shall be deemed "normal contributions".

 

 

09800SB2404sam002- 172 -LRB098 09018 EFG 45623 a

1        (2) Effective July 1, 1969, contributions of 1/2 of 1%
2    of salary toward the cost of the automatic annual increase
3    in retirement annuity provided under Section 16-133.1.
4        (3) Effective July 24, 1959, contributions of 1% of
5    salary towards the cost of survivor benefits. Such
6    contributions shall not be credited to the individual
7    account of the member and shall not be subject to refund
8    except as provided under Section 16-143.2.
9        (4) Effective July 1, 2005, contributions of 0.40% of
10    salary toward the cost of the early retirement without
11    discount option provided under Section 16-133.2. This
12    contribution shall cease upon termination of the early
13    retirement without discount option as provided in Section
14    16-176.
15    (a-1) In addition to the contributions required under
16subsection (a), a member who elects to participate in the
17optional cash balance plan under Section 1-162 shall pay to the
18System for the purpose of participating in the optional cash
19balance plan a contribution of 2% of each payment of
20compensation received while he or she is a participant in the
21optional cash balance plan. These contributions shall not be
22used for the purpose of determining any benefit under this
23Article except as provided in the optional cash balance plan.
24    (a-5) In addition to the contributions otherwise required
25under this Article, each Tier I member who made the election
26under item (ii) of paragraph (1) of subsection (a) of Section

 

 

09800SB2404sam002- 173 -LRB098 09018 EFG 45623 a

116-122.9 shall also make the following contributions toward the
2cost of the retirement annuity from each payment of salary:
3        (1) beginning July 1, 2014 and through June 30, 2015,
4    1% of salary; and
5        (2) beginning on July 1, 2015, 2% of salary.
6    Except as otherwise specified, these contributions are to
7be considered as normal contributions for purposes of this
8Article.
9    (b) The minimum required contribution for any year of
10full-time teaching service shall be $192.
11    (c) Contributions shall not be required of any annuitant
12receiving a retirement annuity who is given employment as
13permitted under Section 16-118 or 16-150.1.
14    (d) A person who (i) was a member before July 1, 1998, (ii)
15retires with more than 34 years of creditable service, and
16(iii) does not elect to qualify for the augmented rate under
17Section 16-129.1 shall be entitled, at the time of retirement,
18to receive a partial refund of contributions made under this
19Section for service occurring after the later of June 30, 1998
20or attainment of 34 years of creditable service, in an amount
21equal to 1.00% of the salary upon which those contributions
22were based.
23    (e) A member's contributions toward the cost of early
24retirement without discount made under item (a)(4) of this
25Section shall not be refunded if the member has elected early
26retirement without discount under Section 16-133.2 and has

 

 

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1begun to receive a retirement annuity under this Article
2calculated in accordance with that election. Otherwise, a
3member's contributions toward the cost of early retirement
4without discount made under item (a)(4) of this Section shall
5be refunded according to whichever one of the following
6circumstances occurs first:
7        (1) The contributions shall be refunded to the member,
8    without interest, within 120 days after the member's
9    retirement annuity commences, if the member does not elect
10    early retirement without discount under Section 16-133.2.
11        (2) The contributions shall be included, without
12    interest, in any refund claimed by the member under Section
13    16-151.
14        (3) The contributions shall be refunded to the member's
15    designated beneficiary (or if there is no beneficiary, to
16    the member's estate), without interest, if the member dies
17    without having begun to receive a retirement annuity under
18    this Article.
19        (4) The contributions shall be refunded to the member,
20    without interest, within 120 days after the early
21    retirement without discount option provided under Section
22    16-133.2 is terminated under Section 16-176.
23(Source: P.A. 93-320, eff. 7-23-03; 94-4, eff. 6-1-05.)
 
24    (40 ILCS 5/16-158.2 new)
25    Sec. 16-158.2. Obligations of State; funding guarantee.

 

 

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1The State shall be contractually obligated to contribute to the
2System in each State fiscal year an amount not less than the
3sum required in Section 16-158 as that Section existed prior to
4the effective date of this amendatory Act of the 98th General
5Assembly.
6    The obligations created under this Section are contractual
7obligations protected and enforceable under Article I, Section
816 and Article XIII, Section 5 of the Illinois Constitution.
9    Notwithstanding any other provision of law, if the State
10fails to pay in a State fiscal year the amount guaranteed under
11this Section, the System may bring a mandamus action in the
12Circuit Court of Sangamon County to compel the State to make
13that payment, irrespective of other remedies that may be
14available to the System. It shall be the mandatory fiduciary
15obligation of the Board of the System to bring that action if
16the State fails to pay in the fiscal year the amount guaranteed
17under this Section. Before commencing that action, the Board
18shall submit a voucher for contributions required under Section
1916-158. If the State fails to pay a vouchered amount within 90
20days after receiving a voucher for that amount, then the Board
21shall submit a written request to the Comptroller seeking
22payment of that amount. A copy of the request shall be filed
23with the Secretary of State, and the Secretary of State shall
24provide copies of the request to the Governor and General
25Assembly. No earlier than the 16th day after filing a request
26with the Secretary, but no later than the 21st day after filing

 

 

09800SB2404sam002- 176 -LRB098 09018 EFG 45623 a

1that request, the Board may commence such an action in the
2Circuit Court. If the Board fails to commence such action on or
3before the 21st day after filing the request with the Secretary
4of State, then any Tier I employee or Tier I retiree who has
5made the election under paragraph (1) of subsection (a) or
6(a-5) of Section 16-122.9 may file a mandamus action against
7the Board to compel the Board to commence its mandamus action
8against the State. This Section constitutes an express waiver
9of the State's sovereign immunity. In ordering the State to
10make the required payment, the court may order a reasonable
11payment schedule to enable the State to make the required
12payment. The obligations and causes of action created under
13this subsection (b) shall be in addition to any other right or
14remedy otherwise accorded by common law, or State or federal
15law, and nothing in this subsection (b) shall be construed to
16deny, abrogate, impair, or waive any such common law or
17statutory right or remedy.
18    Any payments required to be made by the State pursuant to
19this Section are expressly subordinated to the payment of the
20principal, interest, and premium, if any, on any bonded debt
21obligation of the State or any other State-created entity,
22either currently outstanding or to be issued, for which the
23source of repayment or security thereon is derived directly or
24indirectly from tax revenues collected by the State or any
25other State-created entity. Payments on such bonded
26obligations include any statutory fund transfers or other

 

 

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1prefunding mechanisms or formulas set forth, now or hereafter,
2in State law or bond indentures, into debt service funds or
3accounts of the State related to such bonded obligations,
4consistent with the payment schedules associated with such
5obligations.
 
6    (40 ILCS 5/16-203)
7    Sec. 16-203. Application and expiration of new benefit
8increases.
9    (a) As used in this Section, "new benefit increase" means
10an increase in the amount of any benefit provided under this
11Article, or an expansion of the conditions of eligibility for
12any benefit under this Article, that results from an amendment
13to this Code that takes effect after June 1, 2005 (the
14effective date of Public Act 94-4). "New benefit increase",
15however, does not include any benefit increase resulting from
16the changes made to this Article by Public Act 95-910 or this
17amendatory Act of the 98th 95th General Assembly.
18    (b) Notwithstanding any other provision of this Code or any
19subsequent amendment to this Code, every new benefit increase
20is subject to this Section and shall be deemed to be granted
21only in conformance with and contingent upon compliance with
22the provisions of this Section.
23    (c) The Public Act enacting a new benefit increase must
24identify and provide for payment to the System of additional
25funding at least sufficient to fund the resulting annual

 

 

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1increase in cost to the System as it accrues.
2    Every new benefit increase is contingent upon the General
3Assembly providing the additional funding required under this
4subsection. The Commission on Government Forecasting and
5Accountability shall analyze whether adequate additional
6funding has been provided for the new benefit increase and
7shall report its analysis to the Public Pension Division of the
8Department of Financial and Professional Regulation. A new
9benefit increase created by a Public Act that does not include
10the additional funding required under this subsection is null
11and void. If the Public Pension Division determines that the
12additional funding provided for a new benefit increase under
13this subsection is or has become inadequate, it may so certify
14to the Governor and the State Comptroller and, in the absence
15of corrective action by the General Assembly, the new benefit
16increase shall expire at the end of the fiscal year in which
17the certification is made.
18    (d) Every new benefit increase shall expire 5 years after
19its effective date or on such earlier date as may be specified
20in the language enacting the new benefit increase or provided
21under subsection (c). This does not prevent the General
22Assembly from extending or re-creating a new benefit increase
23by law.
24    (e) Except as otherwise provided in the language creating
25the new benefit increase, a new benefit increase that expires
26under this Section continues to apply to persons who applied

 

 

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1and qualified for the affected benefit while the new benefit
2increase was in effect and to the affected beneficiaries and
3alternate payees of such persons, but does not apply to any
4other person, including without limitation a person who
5continues in service after the expiration date and did not
6apply and qualify for the affected benefit while the new
7benefit increase was in effect.
8(Source: P.A. 94-4, eff. 6-1-05; 95-910, eff. 8-26-08.)
 
9    Section 35. The School Code is amended by changing Sections
1024-1 and 24-8 as follows:
 
11    (105 ILCS 5/24-1)  (from Ch. 122, par. 24-1)
12    Sec. 24-1. Appointment-Salaries-Payment-School
13month-School term.) School boards shall appoint all teachers,
14determine qualifications of employment and fix the amount of
15their salaries subject to any limitation set forth in this Act
16and subject to any applicable restrictions in Section 14-106.5,
1715-132.9, or 16-122.9 of the Illinois Pension Code. They shall
18pay the wages of teachers monthly, subject, however, to the
19provisions of Section 24-21. The school month shall be the same
20as the calendar month but by resolution the school board may
21adopt for its use a month of 20 days, including holidays. The
22school term shall consist of at least the minimum number of
23pupil attendance days required by Section 10-19, any additional
24legal school holidays, days of teachers' institutes, or

 

 

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1equivalent professional educational experiences, and one or
2two days at the beginning of the school term when used as a
3teachers' workshop.
4(Source: P.A. 80-249.)
 
5    (105 ILCS 5/24-8)  (from Ch. 122, par. 24-8)
6    Sec. 24-8. Minimum salary. In fixing the salaries of
7teachers, school boards shall pay those who serve on a
8full-time basis not less than a rate for the school year that
9is based upon training completed in a recognized institution of
10higher learning, as follows: for the school year beginning July
111, 1980 and thereafter, less than a bachelor's degree, $9,000;
12120 semester hours or more and a bachelor's degree, $10,000;
13150 semester hours or more and a master's degree, $11,000.
14    Based upon previous public school experience in this State
15or any other State, territory, dependency or possession of the
16United States, or in schools operated by or under the auspices
17of the United States, teachers who serve on a full-time basis
18shall have their salaries increased to at least the following
19amounts above the starting salary for a teacher in such
20district in the same classification: with less than a
21bachelor's degree, $750 after 5 years; with 120 semester hours
22or more and a bachelor's degree, $1,000 after 5 years and
23$1,600 after 8 years; with 150 semester hours or more and a
24master's degree, $1,250 after 5 years, $2,000 after 8 years and
25$2,750 after 13 years. However, any salary increase is subject

 

 

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1to any applicable restrictions in Section 14-106.5, 15-132.9,
2or 16-122.9 of the Illinois Pension Code.
3    For the purpose of this Section a teacher's salary shall
4include any amount paid by the school district on behalf of the
5teacher, as teacher contributions, to the Teachers' Retirement
6System of the State of Illinois.
7    If a school board establishes a schedule for teachers'
8salaries based on education and experience, not inconsistent
9with this Section, all certificated nurses employed by that
10board shall be paid in accordance with the provisions of such
11schedule (subject to any applicable restrictions in Section
1214-106.5, 15-132.9, or 16-122.9 of the Illinois Pension Code).
13    For purposes of this Section, a teacher who submits a
14certificate of completion to the school office prior to the
15first day of the school term shall be considered to have the
16degree stated in such certificate.
17(Source: P.A. 83-913.)
 
18    Section 40. The State Universities Civil Service Act is
19amended by changing Section 36d as follows:
 
20    (110 ILCS 70/36d)  (from Ch. 24 1/2, par. 38b3)
21    Sec. 36d. Powers and duties of the Merit Board.
22    The Merit Board shall have the power and duty-
23    (1) To approve a classification plan prepared under its
24direction, assigning to each class positions of substantially

 

 

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1similar duties. The Merit Board shall have power to delegate to
2its Director the duty of assigning each position in the
3classified service to the appropriate class in the
4classification plan approved by the Merit Board.
5    (2) To prescribe the duties of each class of positions and
6the qualifications required by employment in that class.
7    (3) To prescribe the range of compensation for each class
8or to fix a single rate of compensation for employees in a
9particular class; and to establish other conditions of
10employment which an employer and employee representatives have
11agreed upon as fair and equitable. The Merit Board shall direct
12the payment of the "prevailing rate of wages" in those
13classifications in which, on January 1, 1952, any employer is
14paying such prevailing rate and in such other classes as the
15Merit Board may thereafter determine. "Prevailing rate of
16wages" as used herein shall be the wages paid generally in the
17locality in which the work is being performed to employees
18engaged in work of a similar character. Subject to any
19applicable restrictions in Section 14-106.5, 15-132.9, or
2016-122.9 of the Illinois Pension Code, each Each employer
21covered by the University System shall be authorized to
22negotiate with representatives of employees to determine
23appropriate ranges or rates of compensation or other conditions
24of employment and may recommend to the Merit Board for
25establishment the rates or ranges or other conditions of
26employment which the employer and employee representatives

 

 

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1have agreed upon as fair and equitable, but excluding the
2changes, the impact of changes, and the implementation of the
3changes set forth in this amendatory Act of the 98th General
4Assembly. Any rates or ranges established prior to January 1,
51952, and hereafter, shall not be changed except in accordance
6with the procedures herein provided.
7    (4) To recommend to the institutions and agencies specified
8in Section 36e standards for hours of work, holidays, sick
9leave, overtime compensation and vacation for the purpose of
10improving conditions of employment covered therein and for the
11purpose of insuring conformity with the prevailing rate
12principal.
13    (5) To prescribe standards of examination for each class,
14the examinations to be related to the duties of such class. The
15Merit Board shall have power to delegate to the Director and
16his staff the preparation, conduct and grading of examinations.
17Examinations may be written, oral, by statement of training and
18experience, in the form of tests of knowledge, skill, capacity,
19intellect, aptitude; or, by any other method, which in the
20judgment of the Merit Board is reasonable and practical for any
21particular classification. Different examining procedures may
22be determined for the examinations in different
23classifications but all examinations in the same
24classification shall be uniform.
25    (6) To authorize the continuous recruitment of personnel
26and to that end, to delegate to the Director and his staff the

 

 

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1power and the duty to conduct open and continuous competitive
2examinations for all classifications of employment.
3    (7) To cause to be established from the results of
4examinations registers for each class of positions in the
5classified service of the State Universities Civil Service
6System, of the persons who shall attain the minimum mark fixed
7by the Merit Board for the examination; and such persons shall
8take rank upon the registers as candidates in the order of
9their relative excellence as determined by examination,
10without reference to priority of time of examination.
11    (8) To provide by its rules for promotions in the
12classified service. Vacancies shall be filled by promotion
13whenever practicable. For the purpose of this paragraph, an
14advancement in class shall constitute a promotion.
15    (9) To set a probationary period of employment of no less
16than 6 months and no longer than 12 months for each class of
17positions in the classification plan, the length of the
18probationary period for each class to be determined by the
19Director.
20    (10) To provide by its rules for employment at regular
21rates of compensation of physically handicapped persons in
22positions in which the handicap does not prevent the individual
23from furnishing satisfactory service.
24    (11) To make and publish rules, to carry out the purpose of
25the State Universities Civil Service System and for
26examination, appointments, transfers and removals and for

 

 

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1maintaining and keeping records of the efficiency of officers
2and employees and groups of officers and employees in
3accordance with the provisions of Sections 36b to 36q,
4inclusive, and said Merit Board may from time to time make
5changes in such rules.
6    (12) To appoint a Director and such assistants and other
7clerical and technical help as may be necessary efficiently to
8administer Sections 36b to 36q, inclusive. To authorize the
9Director to appoint an assistant resident at the place of
10employment of each employer specified in Section 36e and this
11assistant may be authorized to give examinations and to certify
12names from the regional registers provided in Section 36k.
13    (13) To submit to the Governor of this state on or before
14November 1 of each year prior to the regular session of the
15General Assembly a report of the University System's business
16and an estimate of the amount of appropriation from state funds
17required for the purpose of administering the University
18System.
19(Source: P.A. 82-524.)
 
20    Section 45. The University of Illinois Act is amended by
21adding Section 85 as follows:
 
22    (110 ILCS 305/85 new)
23    Sec. 85. Future increases in income. The University of
24Illinois must not pay, offer, or agree to pay any future

 

 

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1increase in income, as that term is defined in Section
214-106.5, 15-132.9, or 16-122.9 of the Illinois Pension Code,
3to any person in a manner that violates any of those Sections.
 
4    Section 50. The Southern Illinois University Management
5Act is amended by adding Section 70 as follows:
 
6    (110 ILCS 520/70 new)
7    Sec. 70. Future increases in income. Southern Illinois
8University must not pay, offer, or agree to pay any future
9increase in income, as that term is defined in Section
1014-106.5, 15-132.9, or 16-122.9 of the Illinois Pension Code,
11to any person in a manner that violates any of those Sections.
 
12    Section 55. The Chicago State University Law is amended by
13adding Section 5-180 as follows:
 
14    (110 ILCS 660/5-180 new)
15    Sec. 5-180. Future increases in income. Chicago State
16University must not pay, offer, or agree to pay any future
17increase in income, as that term is defined in Section
1814-106.5, 15-132.9, or 16-122.9 of the Illinois Pension Code,
19to any person in a manner that violates any of those Sections.
 
20    Section 60. The Eastern Illinois University Law is amended
21by adding Section 10-180 as follows:
 

 

 

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1    (110 ILCS 665/10-180 new)
2    Sec. 10-180. Future increases in income. Eastern Illinois
3University must not pay, offer, or agree to pay any future
4increase in income, as that term is defined in Section
514-106.5, 15-132.9, or 16-122.9 of the Illinois Pension Code,
6to any person in a manner that violates any of those Sections.
 
7    Section 65. The Governors State University Law is amended
8by adding Section 15-180 as follows:
 
9    (110 ILCS 670/15-180 new)
10    Sec. 15-180. Future increases in income. Governors State
11University must not pay, offer, or agree to pay any future
12increase in income, as that term is defined in Section
1314-106.5, 15-132.9, or 16-122.9 of the Illinois Pension Code,
14to any person in a manner that violates any of those Sections.
 
15    Section 70. The Illinois State University Law is amended by
16adding Section 20-185 as follows:
 
17    (110 ILCS 675/20-185 new)
18    Sec. 20-185. Future increases in income. Illinois State
19University must not pay, offer, or agree to pay any future
20increase in income, as that term is defined in Section
2114-106.5, 15-132.9, or 16-122.9 of the Illinois Pension Code,

 

 

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1to any person in a manner that violates any of those Sections.
 
2    Section 75. The Northeastern Illinois University Law is
3amended by adding Section 25-180 as follows:
 
4    (110 ILCS 680/25-180 new)
5    Sec. 25-180. Future increases in income. Northeastern
6Illinois University must not pay, offer, or agree to pay any
7future increase in income, as that term is defined in Section
814-106.5, 15-132.9, or 16-122.9 of the Illinois Pension Code,
9to any person in a manner that violates any of those Sections.
 
10    Section 80. The Northern Illinois University Law is amended
11by adding Section 30-190 as follows:
 
12    (110 ILCS 685/30-190 new)
13    Sec. 30-190. Future increases in income. Northern Illinois
14University must not pay, offer, or agree to pay any future
15increase in income, as that term is defined in Section
1614-106.5, 15-132.9, or 16-122.9 of the Illinois Pension Code,
17to any person in a manner that violates any of those Sections.
 
18    Section 85. The Western Illinois University Law is amended
19by adding Section 35-185 as follows:
 
20    (110 ILCS 690/35-185 new)

 

 

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1    Sec. 35-185. Future increases in income. Western Illinois
2University must not pay, offer, or agree to pay any future
3increase in income, as that term is defined in Section
414-106.5, 15-132.9, or 16-122.9 of the Illinois Pension Code,
5to any person in a manner that violates any of those Sections.
 
6    Section 90. The Public Community College Act is amended by
7changing Sections 3-26 and 3-42 as follows:
 
8    (110 ILCS 805/3-26)  (from Ch. 122, par. 103-26)
9    Sec. 3-26. (a) To make appointments and fix the salaries of
10a chief administrative officer, who shall be the executive
11officer of the board, other administrative personnel, and all
12teachers, but subject to any applicable restrictions in Section
1314-106.5, 15-132.9, or 16-122.9 of the Illinois Pension Code.
14In making these appointments and fixing the salaries, the board
15may make no discrimination on account of sex, race, creed,
16color or national origin.
17    (b) Upon the written request of an employee, to withhold
18from the compensation of that employee the membership dues of
19such employee payable to any specified labor organization as
20defined in the Illinois Educational Labor Relations Act. Under
21such arrangement, an amount shall be withheld for each regular
22payroll period which is equal to the prorata share of the
23annual membership dues plus any payments or contributions and
24the board shall pay such withholding to the specified labor

 

 

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1organization within 10 working days from the time of the
2withholding.
3(Source: P.A. 83-1014.)
 
4    (110 ILCS 805/3-42)  (from Ch. 122, par. 103-42)
5    Sec. 3-42. To employ such personnel as may be needed, to
6establish policies governing their employment and dismissal,
7and to fix the amount of their compensation, subject to any
8applicable restrictions in Section 14-106.5, 15-132.9, or
916-122.9 of the Illinois Pension Code. In the employment,
10establishment of policies and fixing of compensation the board
11may make no discrimination on account of sex, race, creed,
12color or national origin.
13    Residence within any community college district or outside
14any community college district shall not be considered:
15        (a) in determining whether to retain or not retain any
16    employee of a community college employed prior to July 1,
17    1977 or prior to the adoption by the community college
18    board of a resolution making residency within the community
19    college district of some or all employees a condition of
20    employment, whichever is later;
21        (b) in assigning, promoting or transferring any
22    employee of a community college to an office or position
23    employed prior to July 1, 1977 or prior to the adoption by
24    the community college board of a resolution making
25    residency within the community college district of some or

 

 

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1    all employees a condition of employment, whichever is
2    later; or
3        (c) in determining the salary or other compensation of
4    any employee of a community college.
5(Source: P.A. 80-248.)
 
6    Section 95. The Illinois Educational Labor Relations Act is
7amended by changing Section 4 as follows:
 
8    (115 ILCS 5/4)  (from Ch. 48, par. 1704)
9    Sec. 4. Employer rights. Employers shall not be required to
10bargain over matters of inherent managerial policy, which shall
11include such areas of discretion or policy as the functions of
12the employer, standards of services, its overall budget, the
13organizational structure and selection of new employees and
14direction of employees. Employers, however, shall be required
15to bargain collectively with regard to policy matters directly
16affecting wages, hours and terms and conditions of employment
17as well as the impact thereon upon request by employee
18representatives, but excluding (i) the payment of the
19additional member contributions set forth in subsections (a-1)
20and (a-5) of Sections 14-133, 15-157, and 16-152 of the
21Illinois Pension Code and (ii) the provision of compensation or
22benefits to employees who make an election under Section
2314-106.5, 15-132.9, or 16-122.9 of the Illinois Pension Code in
24order to offset all or part of any compensation or benefit

 

 

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1limitations included as part of the elections under those
2Sections. To preserve the rights of employers and exclusive
3representatives which have established collective bargaining
4relationships or negotiated collective bargaining agreements
5prior to the effective date of this Act, employers shall be
6required to bargain collectively with regard to any matter
7concerning wages, hours or conditions of employment about which
8they have bargained for and agreed to in a collective
9bargaining agreement prior to the effective date of this Act,
10but excluding (i) the payment of the additional member
11contributions set forth in subsections (a-1) and (a-5) of
12Sections 14-133, 15-157, and 16-152 of the Illinois Pension
13Code and (ii) the provision of compensation or benefits to
14employees who make an election under Section 14-106.5,
1515-132.9, or 16-122.9 of the Illinois Pension Code in order to
16offset all or part of any compensation or benefit limitations
17included as part of the elections under those Sections.
18(Source: P.A. 83-1014.)
 
19    Section 100. The State Mandates Act is amended by adding
20Section 8.37 as follows:
 
21    (30 ILCS 805/8.37 new)
22    Sec. 8.37. Exempt mandate. Notwithstanding Sections 6 and 8
23of this Act, no reimbursement by the State is required for the
24implementation of any mandate created by this amendatory Act of

 

 

09800SB2404sam002- 193 -LRB098 09018 EFG 45623 a

1the 98th General Assembly.
 
2    Section 197. Severability. The provisions of this Act are
3severable under Section 1.31 of the Statute on Statutes.
 
4    Section 999. Effective date. This Act takes effect upon
5becoming law.".