State of Illinois
91st General Assembly
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91_SB1500

 
                                              LRB9110801LDdvB

 1        AN ACT to amend the Illinois  Pension  Code  by  changing
 2    Sections  15-112,  15-113.2,  15-120, 15-134.5, 15-136.4, and
 3    15-141 and adding Section 15-132.2.

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

 6        Section  5.   The  Illinois  Pension  Code  is amended by
 7    changing  Sections  15-112,   15-113.2,   15-120,   15-134.5,
 8    15-136.4, and 15-141 and adding Section 15-132.2 as follows:

 9        (40 ILCS 5/15-112) (from Ch. 108 1/2, par. 15-112)
10        Sec.  15-112.   Final  rate  of earnings.  "Final rate of
11    earnings": For an employee who is paid on an hourly basis  or
12    who  receives  an  annual  salary  in  installments during 12
13    months of each academic year,  the  average  annual  earnings
14    during  the  48 consecutive calendar month period ending with
15    the last day of final termination  of  employment  or  the  4
16    consecutive academic years of service in which the employee's
17    earnings  were  the  highest,  whichever  is greater. For any
18    other employee, the average  annual  earnings  during  the  4
19    consecutive  academic  years  of  service in which his or her
20    earnings were the highest. For an employee with less than  48
21    months  or  4  consecutive  academic  years  of  service, the
22    average earnings during his or her entire period of  service.
23    The  earnings  of  an  employee  with  more than 36 months of
24    service prior to the date of becoming a participant are,  for
25    such  period, considered equal to the average earnings during
26    the last 36 months of such service. For an employee on  leave
27    of  absence  with pay, or on leave of absence without pay who
28    makes contributions during such leave, earnings  are  assumed
29    to  be  equal to the basic compensation on the date the leave
30    began. For an employee  on  disability  leave,  earnings  are
31    assumed  to  be  equal  to the basic compensation on the date
 
                            -2-               LRB9110801LDdvB
 1    disability occurs or  the  average  earnings  during  the  24
 2    months  immediately  preceding  the month in which disability
 3    occurs, whichever is greater.
 4        For a participant who retires on or after  the  effective
 5    date of this amendatory Act of 1997 with at least 20 years of
 6    service  as  a  firefighter  or  police  officer  under  this
 7    Article,  the final rate of earnings shall be the annual rate
 8    of earnings received by the participant on his  or  her  last
 9    day as a firefighter or police officer under this Article, if
10    that is greater than the final rate of earnings as calculated
11    under the other provisions of this Section.
12        If  a  participant  is  an employee for at least 6 months
13    during the academic year in which his or  her  employment  is
14    terminated, the annual final rate of earnings shall be 25% of
15    the  sum  of (1) the annual basic compensation for that year,
16    and (2) the amount earned during the  36  months  immediately
17    preceding  that  year, if this is greater than the final rate
18    of earnings as calculated under the other provisions of  this
19    Section.
20        In the determination of the final rate of earnings for an
21    employee,  that  part  of  an  employee's  earnings  for  any
22    academic  year  beginning  after June 30, 1997, which exceeds
23    the employee's earnings with that employer for the  preceding
24    year by more than 20 percent shall be excluded, except in the
25    case  of  a change in position; in the event that an employee
26    has  more  than  one  employer  this  limitation   shall   be
27    calculated  separately  for  the earnings with each employer.
28    In making such calculation, only the  basic  compensation  of
29    employees  shall be considered, without regard to vacation or
30    overtime or to contracts for summer employment.
31        The  following  are  not  considered   as   earnings   in
32    determining   final   rate   of   earnings:  separation  pay,
33    retirement pay, payment in lieu  of  unused  sick  leave  and
34    payments  from an employer for the period used in determining
 
                            -3-               LRB9110801LDdvB
 1    final rate of earnings for any purpose  other  than  services
 2    rendered,  leave  of  absence or vacation granted during that
 3    period, and vacation of up  to  56  work  days  allowed  upon
 4    termination  of  employment  under  a  vacation  policy of an
 5    employer which was in effect on or before January 1, 1977.
 6        Intermittent periods of service shall  be  considered  as
 7    consecutive in determining final rate of earnings.
 8    (Source: P.A. 90-65, eff. 7-7-97; 90-511, eff. 8-22-97.)

 9        (40 ILCS 5/15-113.2) (from Ch. 108 1/2, par. 15-113.2)
10        Sec.  15-113.2.  Service  for leaves of absence. "Service
11    for leaves of absence" includes those periods  of  leaves  of
12    absence  at  less  than  50%  pay,  except military leave and
13    periods of disability leave in excess of 60 days,  for  which
14    the  employee  pays  the contributions required under Section
15    15-157 in accordance with rules prescribed by the board based
16    upon the employee's basic compensation on the date the  leave
17    begins,  or  in  the case of leave for service with a teacher
18    organization, based upon the actual compensation received  by
19    the  employee for such service after January 26, 1988, if the
20    employee so elects within 30 days of that date  or  the  date
21    the  leave  for  service  with a teacher organization begins,
22    whichever is later; provided that the employee (1) returns to
23    employment covered by this system at the  expiration  of  the
24    leave,   or  within  30  days  after  the  termination  of  a
25    disability which occurs during the leave and  continues  this
26    employment  at  a percentage of time equal to or greater than
27    the percentage of time immediately  preceding  the  leave  of
28    absence  for  at least 8 consecutive months or a period equal
29    to the period of the leave, whichever  is  less,  or  (2)  is
30    precluded  from  meeting  the foregoing conditions because of
31    disability or death.  If service credit is denied because the
32    employee fails to meet these  conditions,  the  contributions
33    covering  the  leave  of  absence  shall  be refunded without
 
                            -4-               LRB9110801LDdvB
 1    interest.  The return to employment condition does not  apply
 2    if  the  leave  of  absence  is  for  service  with a teacher
 3    organization.
 4        Service credit provided  under  this  Section  shall  not
 5    exceed 3 years in any period of 10 years, unless the employee
 6    is  on special leave granted by the employer for service with
 7    a teacher organization.  Commencing with the fourth  year  in
 8    any  period  of 10 years, a participant on such special leave
 9    is also required to pay employer contributions equal  to  the
10    normal  cost  as  defined  in  Section 15-155, based upon the
11    employee's basic compensation on the date the  leave  begins,
12    or  based  upon  the  actual  compensation  received  by  the
13    employee  for  service  with  a  teacher  organization if the
14    employee has so elected.
15    (Source: P.A. 90-65, eff. 7-7-97; 90-511, eff. 8-22-97.)

16        (40 ILCS 5/15-120) (from Ch. 108 1/2, par. 15-120)
17        Sec.  15-120.   Beneficiary;  survivor  annuitant   under
18    portable   benefit  package.  "Beneficiary":  The  person  or
19    persons designated by the participant  or  annuitant  in  the
20    last  written  designation  on  file with the board; or if no
21    person so designated survives, or if  no  designation  is  on
22    file,  the estate of the participant or annuitant. Acceptance
23    by the participant of a refund of  accumulated  contributions
24    shall  result in cancellation of all beneficiary designations
25    previously filed. A spouse whose marriage was dissolved shall
26    be  disqualified  as  beneficiary  unless  the   spouse   was
27    designated  as  beneficiary  after  the effective date of the
28    dissolution of marriage.
29        After a joint and survivor annuity  commences  under  the
30    portable  benefit  package, the survivor annuitant of a joint
31    and survivor annuity is not  disqualified,  and  may  not  be
32    removed,  as  the  survivor annuitant by a dissolution of the
33    survivor's marriage with the participant or annuitant.
 
                            -5-               LRB9110801LDdvB
 1    (Source: P.A. 83-1440.)

 2        (40 ILCS 5/15-132.2 new)
 3        Sec.  15-132.2  Retire  and  retirement.  A   participant
 4    "retires" and his or her "retirement" begins, when his or her
 5    annuity payment period begins.

 6        (40 ILCS 5/15-134.5)
 7        Sec. 15-134.5.  Retirement Program Elections.
 8        (a)  All  participating  employees are participants under
 9    the traditional benefit package prior  to  January  1,  1998.
10    Effective  as  of  the  date  that  an  employer  elects,  as
11    described  in Section 15-158.2, to offer to its employees the
12    portable  benefit  package  and  the  self-managed  plan   as
13    alternatives to the traditional benefit package, each of that
14    employer's  eligible  employees (as defined in subsection (b)
15    shall be given the choice to elect which  retirement  program
16    he  or  she  wishes  to  participate  in  with respect to all
17    periods of covered employment  occurring  on  and  after  the
18    effective  date  of  the employee's election.  The retirement
19    program election made by an eligible employee must be made in
20    writing, in the manner prescribed by the System,  and  within
21    the time period described in subsection (d) or (d-1).
22        The  employee  election  authorized  by this Section is a
23    one-time, irrevocable election.  If  an  employee  terminates
24    employment  after  making  the  election  provided under this
25    subsection (a), then upon his or her subsequent re-employment
26    with an employer the original  election  shall  automatically
27    apply  to  him  or  her, provided that the employer is then a
28    participating employer as described in Section 15-158.2.
29        An eligible employee who  fails  to  make  this  election
30    shall,  by  default,  participate  in the traditional benefit
31    package.
32        (b)  "Eligible employee" means an employee (as defined in
 
                            -6-               LRB9110801LDdvB
 1    Section 15-107) who is either a currently  eligible  employee
 2    or  a newly eligible employee.  For purposes of this Section,
 3    a  "currently  eligible  employee"  is  an  employee  who  is
 4    employed by an employer on the effective date  on  which  the
 5    employer offers to its employees the portable benefit package
 6    and  the self-managed plan as alternatives to the traditional
 7    benefit package.  A "newly eligible employee" is an  employee
 8    who first becomes employed by an employer after the effective
 9    date  on which the employer offers its employees the portable
10    benefit package and the self-managed plan as alternatives  to
11    the  traditional  benefit  package. A newly eligible employee
12    participates in the traditional benefit package until  he  or
13    she  makes an election to participate in the portable benefit
14    package or the self-managed plan. If  an  employee  does  not
15    elect  to  participate in the portable benefit package or the
16    self-managed plan, he or she shall continue to participate in
17    the traditional benefit package by default.
18        (c)  An eligible employee who at the time he  or  she  is
19    first  eligible  to make the election described in subsection
20    (a) does not have sufficient age and service to qualify for a
21    retirement  annuity  under  Section  15-135  may   elect   to
22    participate  in the traditional benefit package, the portable
23    benefit package,  or  the  self-managed  plan.   An  eligible
24    employee  who has sufficient age and service to qualify for a
25    retirement annuity under Section 15-135 at the time he or she
26    is  first  eligible  to  make  the  election   described   in
27    subsection  (a)  may  elect to participate in the traditional
28    benefit package or the portable benefit package, but may  not
29    elect to participate in the self-managed plan.
30        (d)  A   currently   eligible  employee  must  make  this
31    election within one year after  the  effective  date  of  the
32    employer's  adoption  of  the  self-managed  plan.    A newly
33    eligible employee must make this  election  within  6  months
34    after  the  date  on  which the System receives the report of
 
                            -7-               LRB9110801LDdvB
 1    status certification from the employer 60 days after becoming
 2    an eligible employee. If an employee elects to participate in
 3    the self-managed plan, no  employer  contributions  shall  be
 4    remitted to the self-managed plan when the employee's account
 5    balance  transfer  is  made.  Employer  contributions  to the
 6    self-managed plan shall commence as of the first  pay  period
 7    that   begins   after  the  System  receives  the  employee's
 8    election.
 9        (d-1)  A  newly  eligible  employee  who,  prior  to  the
10    effective date of this amendatory Act  of  the  91st  General
11    Assembly,  fails  to  make  the  election  within  the period
12    provided under subsection (d) and participates by default  in
13    the  traditional  benefit package may make a late election to
14    participate  in  the  portable   benefit   package   or   the
15    self-managed  plan instead of the traditional benefit package
16    at any time within 6 months after the effective date of  this
17    amendatory  Act  of  the  91st General Assembly. The employer
18    shall not remit contributions to the system on  behalf  of  a
19    newly  eligible  employee until the earlier of the expiration
20    of the employee's 60-day election period or the date on which
21    the employee submits a properly  completed  election  to  the
22    employer or to the system.
23        (e)  If  a  currently  an  eligible  employee  elects the
24    portable benefit package,  that  election  shall  not  become
25    effective until the one-year anniversary of the date on which
26    the  election is filed with the system, provided the employee
27    remains continuously employed by the employer throughout  the
28    one-year  waiting  period,  and any benefits payable to or on
29    account of the employee before such one-year  waiting  period
30    has  ended  shall  not  be  determined  under  the provisions
31    applicable to the portable benefit package but shall  instead
32    be  determined  in  accordance  with  the traditional benefit
33    package.  If a currently an eligible employee who has elected
34    the portable benefit package terminates employment covered by
 
                            -8-               LRB9110801LDdvB
 1    the system before the one-year waiting period has ended, then
 2    no benefits shall be determined under  the  portable  benefit
 3    package  provisions while he or she is inactive in the system
 4    and upon re-employment with an employer covered by the system
 5    he or she shall begin a new one-year  waiting  period  before
 6    the   provisions  of  the  portable  benefit  package  become
 7    effective.
 8        (f)  An eligible employee shall be provided with  written
 9    information  prepared  or  prescribed  by  the  system  which
10    describes  the  employee's  retirement  program choices.  The
11    eligible employee shall be offered an opportunity to  receive
12    counseling  from  the  system  prior  to  making  his  or her
13    election.   This  counseling  may   consist   of   videotaped
14    materials,  group presentations, individual consultation with
15    an employee or authorized representative  of  the  system  in
16    person  or  by  telephone  or  other electronic means, or any
17    combination of these methods.
18    (Source: P.A. 90-766, eff. 8-14-98.)

19        (40 ILCS 5/15-136.4)
20        Sec. 15-136.4. Retirement  and  Survivor  Benefits  Under
21    Portable Benefit Package.
22        (a)  This  Section 15-136.4 describes the form of annuity
23    and survivor benefits available  to  a  participant  who  has
24    elected  the  portable  benefit package and has completed the
25    one-year waiting period  required  under  subsection  (e)  of
26    Section  15-134.5.   For  purposes  of this Section, the term
27    "eligible spouse" means the husband or wife of a  participant
28    to   whom   the  participant  is  married  on  the  date  the
29    participant's retirement annuity  begins,  provided  however,
30    that  if the participant should die prior to the commencement
31    of retirement annuity benefits, then "eligible spouse"  means
32    the  husband  or  wife,  if  any, to whom the participant was
33    married throughout the one-year period preceding the date  of
 
                            -9-               LRB9110801LDdvB
 1    his or her death.
 2        (b)  This  subsection  (b)  describes  the normal form of
 3    annuity payable to a  participant  subject  to  this  Section
 4    15-136.4.  If the participant is unmarried on the date his or
 5    her  annuity  payments  commence,  then  the annuity payments
 6    shall be made  in  the  form  of  a  single-life  annuity  as
 7    described  in  Section 15-118.  If the participant is married
 8    on the date his or her annuity payments  commence,  then  the
 9    annuity  payments  shall  be  paid in the form of a qualified
10    joint and survivor annuity that is the  actuarial  equivalent
11    of  the  single-life annuity.  Under the "qualified joint and
12    survivor annuity", a reduced amount  shall  be  paid  to  the
13    participant  for  his or her lifetime and his or her eligible
14    spouse, if surviving at the  participant's  death,  shall  be
15    entitled   to  receive  thereafter  a  lifetime  survivorship
16    annuity in a monthly amount  equal  to  50%  of  the  reduced
17    monthly amount that was payable to the participant.  The last
18    payment  of  a  qualified joint and survivor annuity shall be
19    made as of the first day of the month in which the  death  of
20    the survivor occurs.
21        (c)  Instead  of the normal form of annuity that would be
22    paid under subsection (b), a participant may elect in writing
23    within the 90-day period prior to the date his or her annuity
24    payments commence to waive the normal form of annuity payment
25    and receive an optional  form  of  annuity  as  described  in
26    subsection  (h).  If the participant is married and elects an
27    optional form of annuity under subsection (h)  other  than  a
28    joint   and   survivor   annuity  with  the  eligible  spouse
29    designated as the contingent annuitant,  then  such  election
30    shall  require  the  consent of his or her eligible spouse in
31    the manner described in subsection (d).  At any  time  during
32    the  90-day  period  preceding  the  date  the  participant's
33    annuity  commences,  the  participant may revoke the optional
34    form elected under this subsection (c) and reinstate coverage
 
                            -10-              LRB9110801LDdvB
 1    under the qualified joint and survivor  annuity  without  the
 2    spouse's consent, but an election to revoke the optional form
 3    elected  and  elect  a  new  optional  form  or  designate  a
 4    different contingent annuitant shall not be effective without
 5    the eligible spouse's consent.
 6        (d)   The  eligible spouse's consent to any election made
 7    pursuant to this Section that requires the eligible  spouse's
 8    consent  shall be in writing and shall acknowledge the effect
 9    of the consent.  In addition, the eligible spouse's signature
10    on the written consent must be witnessed by a notary  public.
11    The  eligible  spouse's  consent  need not be obtained if the
12    system is satisfied that there is no  eligible  spouse,  that
13    the  eligible  spouse  cannot  be  located, or because of any
14    other relevant circumstances.  An eligible  spouse's  consent
15    under  this  Section  is  valid  only  with  respect  to  the
16    specified  optional  form  of  payment  and,  if  applicable,
17    contingent  annuitant  designated by the participant.  If the
18    optional form of  payment  or  the  contingent  annuitant  is
19    subsequently  changed  (other  than  by  a  revocation of the
20    optional form and reinstatement of the  qualified  joint  and
21    survivor  annuity),  a  new consent by the eligible spouse is
22    required.  The eligible spouse's consent to an election  made
23    by a participant pursuant to this Section, once made, may not
24    be revoked by the eligible spouse.
25        (e)   Within  a  reasonable  period of time preceding the
26    date a participant's annuity commences, a  participant  shall
27    be  supplied  with a written explanation of (1) the terms and
28    conditions  of  the  normal  form  single-life  annuity   and
29    qualified  joint  and survivor annuity, (2) the participant's
30    right to elect a single-life annuity or an optional  form  of
31    payment  under  subsection (h) subject to his or her eligible
32    spouse's consent, if applicable, and  (3)  the  participant's
33    right  to  reinstate  coverage  under the qualified joint and
34    survivor annuity prior to his  or  her  annuity  commencement
 
                            -11-              LRB9110801LDdvB
 1    date  by  revoking an election of an optional form of benefit
 2    under subsection (h).
 3        (f)  If a married participant with at least  5  years  of
 4    service  dies prior to commencing retirement annuity payments
 5    and prior to taking a refund under Section 15-154, his or her
 6    eligible spouse  is  entitled  to  receive  a  pre-retirement
 7    survivor  annuity, if there is not then in effect a waiver of
 8    the  pre-retirement  survivor  annuity.   The  pre-retirement
 9    survivor annuity payable under this  subsection  shall  be  a
10    monthly  annuity  payable  for  the  eligible  spouse's life,
11    commencing as of the beginning of the  month  next  following
12    the  later of the date of the participant's death or the date
13    the  participant  would  have  first  met   the   eligibility
14    requirements  for  retirement,  and  continuing  through  the
15    beginning  of  the  month  in which the death of the eligible
16    spouse occurs.  The monthly  amount  payable  to  the  spouse
17    under  the  pre-retirement survivor annuity shall be equal to
18    the monthly amount  that  would  be  payable  as  a  survivor
19    annuity  under  the  qualified  joint  and  survivor  annuity
20    described  in  subsection  (b)  if:  (1)  in  the  case  of a
21    participant who dies on  or  after  the  date  on  which  the
22    participant   has   met   the  eligibility  requirements  for
23    retirement, the participant had  retired  with  an  immediate
24    qualified  joint  and  survivor annuity on the day before the
25    participant's date  of  death;  or  (2)  in  the  case  of  a
26    participant  who  dies  before the earliest date on which the
27    participant would have met the eligibility  requirements  for
28    retirement age, the participant had separated from service on
29    the  date  of  death, survived to the earliest retirement age
30    based on service prior to his or her death, retired  with  an
31    immediate   qualified  joint  and  survivor  annuity  at  the
32    earliest retirement age, and died on the day after the day on
33    which  the  participant  would  have  attained  the  earliest
34    retirement age.
 
                            -12-              LRB9110801LDdvB
 1        (g)  A married participant who has not retired may  elect
 2    at  any  time  to  waive  the pre-retirement survivor annuity
 3    described in subsection (f).  Any such election shall require
 4    the consent of  the  participant's  eligible  spouse  in  the
 5    manner   described  in  subsection  (e).   A  waiver  of  the
 6    pre-retirement survivor annuity shall increase the  lump  sum
 7    death benefit payable under subsection (b) of Section 15-141.
 8    Prior  to  electing any waiver of the pre-retirement survivor
 9    annuity, the participant shall be  provided  with  a  written
10    explanation   of   (1)   the  terms  and  conditions  of  the
11    pre-retirement  survivor  annuity  and  the  death   benefits
12    payable   from   the   system   both  with  and  without  the
13    pre-retirement survivor annuity, (2) the participant's  right
14    to  elect  a  waiver  of  the pre-retirement survivor annuity
15    coverage subject to his or her spouse's consent, and (3)  the
16    participant's  right  to  reinstate  pre-retirement  survivor
17    annuity  coverage  at  any time by revoking a prior waiver of
18    such coverage.
19        (h)  By filing a  timely  election  with  the  system,  a
20    participant  who  will  be  eligible  to receive a retirement
21    annuity under this Section  may  waive  the  normal  form  of
22    annuity  payment  described  in  subsection  (b),  subject to
23    obtaining the consent of  his  or  her  eligible  spouse,  if
24    applicable,  and  elect  to  receive any one of the following
25    optional annuity forms:
26             (1)  Joint  and  Survivor  Annuity   Options:    The
27        participant  may  elect  to  receive  a  reduced  annuity
28        payable  for  his  or  her  life  and  to have a lifetime
29        survivorship annuity in a monthly amount  equal  to  50%,
30        75%,  or  100%  (as  elected  by the participant) of that
31        reduced  monthly   amount,   to   be   paid   after   the
32        participant's  death  to his or her contingent annuitant,
33        if the contingent annuitant is alive at the time  of  the
34        participant's death.
 
                            -13-              LRB9110801LDdvB
 1             (2)  Single-Life   Annuity   Option   (optional  for
 2        married participants).   The  participant  may  elect  to
 3        receive a single-life annuity payable for his or her life
 4        only.
 5             (3)  Lump  sum  retirement  benefit. The participant
 6        may elect to receive a lump sum retirement  benefit  that
 7        is  equal to the amount of a refund payable under Section
 8        15-154(a-2).
 9    All optional annuity forms shall be in an amount that is  the
10    actuarial equivalent of the single-life annuity.
11        For  the  purposes  of this Section, the term "contingent
12    annuitant" means the  beneficiary  who  is  designated  by  a
13    participant  at  the  time the participant elects a joint and
14    survivor annuity to receive the lifetime survivorship annuity
15    in the event the beneficiary survives the participant at  the
16    participant's death.
17        (i)  Under  no  circumstances  may  an option be elected,
18    changed,  or  revoked  after  the  date   the   participant's
19    retirement annuity commences.
20        (j)  An  election  made  pursuant to subsection (h) shall
21    become inoperative  if  the  participant  or  the  contingent
22    annuitant  dies  before  the  date  the participant's annuity
23    payments commence, or if the  eligible  spouse's  consent  is
24    required and not given.
25        (k)  For  purposes  of applying the provisions of Section
26    20-123 of this Code, the portable benefit  package  shall  be
27    treated as if it were provided by a participating system that
28    has no survivor's annuity benefit.
29        (l)  The   automatic   annual   increases   described  in
30    subsection (d) of Section 15-136 shall  apply  to  retirement
31    benefits under the portable benefit package and the automatic
32    annual  increases  described  in  subsection  (j)  of Section
33    15-145 shall apply to survivor benefits  under  the  portable
34    benefit package.
 
                            -14-              LRB9110801LDdvB
 1    (Source: P.A. 90-448, eff. 8-16-97; 90-766, eff. 8-14-98.)

 2        (40 ILCS 5/15-141) (from Ch. 108 1/2, par. 15-141)
 3        Sec. 15-141. Death benefits - Death of participant.
 4        (a)  The   beneficiary   of   a   participant  under  the
 5    traditional benefit package is entitled to  a  death  benefit
 6    equal to the sum of (1) the employee's accumulated normal and
 7    additional  contributions  on  the  date  of  death,  (2) the
 8    employee's accumulated survivors insurance  contributions  on
 9    the  date  of  death, if a survivors insurance benefit is not
10    payable, (3) an amount equal to the employee's final rate  of
11    earnings,  but  not  more than $5,000 if (i) the beneficiary,
12    under rules of the board, was dependent upon the participant,
13    (ii) the participant was a participating employee immediately
14    prior to his or her death, and (iii)  a  survivors  insurance
15    benefit is not payable, and (4) $2,500 if (i) the beneficiary
16    was  not dependent upon the participant, (ii) the participant
17    was a participating employee immediately prior to his or  her
18    death,  and  (iii)  a  survivors  insurance  benefit  is  not
19    payable.
20        (b)  If the participant has elected to participate in the
21    portable  benefit  package  and  has  completed  the one-year
22    waiting period  required  under  subsection  (e)  of  Section
23    15-134.5,  the death benefit shall be equal to the employee's
24    accumulated normal and additional contributions on  the  date
25    of  death  plus, if the employee died with 5 or more years of
26    service  for  employment  as  defined  in  Section  15-113.1,
27    employer contributions in an amount equal to the sum  of  the
28    accumulated normal and additional contributions;  except that
29    if a pre-retirement survivor annuity is payable under Section
30    15-136.4,  the  death  benefit  payable  under this paragraph
31    shall be reduced, but to not less than zero, by the actuarial
32    value of the benefit payable to the surviving spouse.  If the
33    recipient of a pre-retirement survivor annuity dies before an
 
                            -15-              LRB9110801LDdvB
 1    amount  equal  to  all  accumulated  normal  and   additional
 2    contributions as of the date of death have been paid out, the
 3    remaining   difference   shall   be   paid  to  the  member's
 4    beneficiary. The primary beneficiary of the participant  must
 5    be  his  or her spouse unless the spouse has consented to the
 6    designation of another beneficiary in the manner described in
 7    subsection (d) of Section 15-136.4.
 8        (c)  If payments are made  under  any  State  or  Federal
 9    Workers' Compensation or Occupational Diseases Law because of
10    the  death  of  an employee, the portion of the death benefit
11    payable from employer contributions shall be reduced  by  the
12    total amount of the payments.
13    (Source: P.A. 90-448, eff. 8-16-97; 90-766, eff. 8-14-98.)

14        Section  99.  Effective date.  This Act takes effect upon
15    becoming law.

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