Public Act 90-0032 of the 90th General Assembly

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Public Act 90-0032

HB0313 Enrolled                                LRB9000555EGfg

    AN ACT in relation to public employee pensions.

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

    Section  5.   The  Illinois  Pension  Code  is amended by
changing  Sections  3-110.5,   3-110.6,   4-109.1,   4-115.1,
5-167.5,  5-237,  6-164.2,  7-139.8, 7-141.1, 8-138, 8-150.1,
8-159, 8-164.1, 9-101,  9-121.13,  9-133,  9-133.1,  9-179.3,
11-134,  11-145.1,  11-154, 11-160.1, 14-104, 14-110, 15-157,
15-157.1, 16-127, 16-141, 17-106, 17-115,  17-116.1,  17-117,
17-117.1, 17-120, 17-122, 17-134, 17-146, 17-146.1 and 17-149
and  adding  Sections  7-145.1,  7-145.2,  9-120.1,  9-134.3,
9-146.2, and 14-104.10 as follows:

    (40 ILCS 5/3-110.5) (from Ch. 108 1/2, par. 3-110.5)
    Sec. 3-110.5. Transfer to Article 14 system.
    (a)  Until  January  1,  1990,  any  active member of the
State Employees' Retirement System who is a  State  policeman
and  until  July  1,  1998,  any  active  member of the State
Employees' Retirement System who is a  security  employee  of
the  Department  of Corrections may apply for transfer of his
or her creditable service accumulated in any  police  pension
fund  under  this  Article to the State Employees' Retirement
System.  Such creditable service shall  be  transferred  only
upon  payment  by  such  police  pension  fund  to  the State
Employees' Retirement System of an amount equal to:
         (1)  the amounts accumulated to the  credit  of  the
    applicant  on  the  books  of  the  fund  on  the date of
    transfer; and
         (2)  employer contributions in an  amount  equal  to
    the amount determined under subparagraph (1); and
         (3)  any  interest paid by the applicant in order to
    reinstate service.
Participation in this Fund shall terminate  on  the  date  of
transfer.
    (b)  Until  January 1, 1990, any such State policeman and
until July  1,  1998,  any  such  security  employee  of  the
Department  of  Corrections  may  reinstate service which was
terminated by receipt of a refund, by payment to  the  police
pension  fund  of  the  amount  of  the  refund with interest
thereon at the rate of 6% per year, compounded annually, from
the date of refund to the date of payment.
(Source: P.A. 86-272.)

    (40 ILCS 5/3-110.6) (from Ch. 108 1/2, par. 3-110.6)
    Sec. 3-110.6.  Transfer to Article 14 System.
    (a)  Any active member of the State Employees' Retirement
System who is an investigator for the Office of  the  State's
Attorneys  Appellate  Prosecutor  or  a  controlled substance
inspector may apply for transfer of  his  or  her  creditable
service  accumulated  in  any  police pension fund under this
Article  to  the  State  Employees'  Retirement   System   in
accordance with Section 14-110.  The creditable service shall
be  transferred  only upon payment by the police pension fund
to the State Employees' Retirement System of an amount  equal
to:
         (1)  the  amounts  accumulated  to the credit of the
    applicant on the  books  of  the  fund  on  the  date  of
    transfer; and
         (2)  employer  contributions  in  an amount equal to
    the amount determined under subparagraph (1); and
         (3)  any interest paid by the applicant in order  to
    reinstate service.
Participation  in  the police pension fund shall terminate on
the date of transfer.
    (b)  Any such investigator  or  inspector  may  reinstate
service  which  was  terminated  by  receipt  of a refund, by
paying to the police pension fund the amount  of  the  refund
with  interest thereon at the rate of 6% per year, compounded
annually, from the date of refund to the date of payment.
(Source: P.A. 87-1265.)

    (40 ILCS 5/4-109.1) (from Ch. 108 1/2, par. 4-109.1)
    Sec. 4-109.1.  Increase in pension.
    (a)  Except as provided in subsection  (e),  the  monthly
pension  of  a firefighter who retires after July 1, 1971 and
prior to January 1, 1986, shall, upon either the first of the
month  following  the  first  anniversary  of  the  date   of
retirement  if 60 years of age or over at retirement date, or
upon the first day of the month following attainment  of  age
60 if it occurs after the first anniversary of retirement, be
increased by 2% of the originally granted monthly pension and
by  an  additional  2% in each January thereafter.  Effective
January 1976, the rate of the annual increase shall be 3%  of
the originally granted monthly pension.
    (b)  The  monthly  pension  of  a firefighter who retired
from service with 20 or more years of service, on  or  before
July  1,  1971,  shall  be  increased, in January of the year
following the year of attaining age 65 or in January 1972, if
then over age 65, by 2% of  the  originally  granted  monthly
pension,  for  each  year  the  firefighter  received pension
payments.  In  each  January  thereafter,  he  or  she  shall
receive  an additional increase of 2% of the original monthly
pension.  Effective January 1976,  the  rate  of  the  annual
increase shall be 3%.
    (c)  The   monthly   pension  of  a  firefighter  who  is
receiving a disability pension under this  Article  shall  be
increased,  in  January  of  the  year following the year the
firefighter attains age 60, or in January 1974, if then  over
age  60,  by 2% of the originally granted monthly pension for
each year he or she  received  pension  payments.    In  each
January   thereafter,   the   firefighter  shall  receive  an
additional increase of 2% of the  original  monthly  pension.
Effective January 1976, the rate of the annual increase shall
be 3%.
    (c-1)  On  January  1,  1998,  every  child's  disability
benefit  payable  on that date under Section 4-110 or 4-110.1
shall be increased by an amount equal to 1/12 of  3%  of  the
amount of the benefit, multiplied by the number of months for
which  the  benefit  has  been  payable.   On  each January 1
thereafter, every child's disability  benefit  payable  under
Section  4-110  or  4-110.1  shall  be increased by 3% of the
amount of the benefit then being paid, including any previous
increases received under this Article.  These  increases  are
not  subject  to any limitation on the maximum benefit amount
included in Section 4-110 or 4-110.1.
    (d)  The monthly pension of  a  firefighter  who  retires
after  January  1,  1986, shall, upon either the first of the
month  following  the  first  anniversary  of  the  date   of
retirement  if 55 years of age or over at retirement date, or
upon the first day of the month following attainment  of  age
55 if it occurs after the first anniversary of retirement, be
increased by 3% of the originally granted monthly pension for
each  full year that has elapsed since the pension began, and
by an additional 3% in each January thereafter.
    (e)  Notwithstanding the provisions  of  subsection  (a),
upon  the  first  day  of  the  month following (1) the first
anniversary of the date of retirement, or (2) the  attainment
of  age 55, or (3) July 1, 1987, whichever occurs latest, the
monthly pension of a firefighter  who  retired  on  or  after
January  1, 1977 and on or before January 1, 1986 and did not
receive an increase under subsection (a) before July 1, 1987,
shall be increased by 3% of the  originally  granted  monthly
pension for each full year that has elapsed since the pension
began,  and  by  an additional 3% in each January thereafter.
The increases provided under this subsection are in  lieu  of
the increases provided in subsection (a).
(Source: P.A. 85-941.)

    (40 ILCS 5/4-115.1) (from Ch. 108 1/2, par. 4-115.1)
    Sec.   4-115.1.    Eligibility  of  children.   Dependent
benefits shall be paid to each natural child  of  a  deceased
firefighter,  and  to  each  child legally adopted before the
firefighter attains age 50, until the child's  attainment  of
age  18,  or marriage, whichever occurs first, whether or not
the death of the firefighter occurred prior to  November  21,
1975.
    Benefits  payable  to or on account of a child under this
Article shall not be reduced or terminated by reason  of  the
child's  adoption  by  a  third party after the firefighter's
death.
    Benefits payable to or on account of a child  under  this
Article  to  children  shall  not be reduced or terminated by
reason of the child's attainment of age 18 if he  or  she  is
then  dependent  by reason of a physical or mental disability
but shall continue to be paid  as  long  as  such  dependency
continues.   Individuals over the age of 18 and adjudged as a
disabled person pursuant to Article XIa of the Probate Act of
1975, except for persons receiving benefits under Article III
of the Illinois Public Aid Code, shall be eligible to receive
benefits under this Act.
(Source: P.A. 83-1440.)

    (40 ILCS 5/5-167.5) (from Ch. 108 1/2, par. 5-167.5)
    Sec. 5-167.5.  Group health benefit.
    (a)  For the purposes of this  Section:  (1)  "annuitant"
means  a person receiving an age and service annuity, a prior
service annuity, a widow's annuity, a widow's  prior  service
annuity,  or  a  minimum annuity on or after January 1, 1988,
under Article 5, 6, 8 or 11, by reason of previous employment
by the City of Chicago (hereinafter, in  this  Section,  "the
city");  (2)  "Medicare  Plan  annuitant"  means an annuitant
described in item (1) who is eligible for Medicare  benefits;
and  (3)  "non-Medicare  Plan  annuitant"  means an annuitant
described in item  (1)  who  is  not  eligible  for  Medicare
benefits.
    (b)  The  city  shall  continue  to  offer  group  health
benefits  to annuitants and their eligible dependents through
June  30,  2002.   The  same  basic  city  health  care  plan
available as of June 30, 1988 (hereinafter called  the  basic
city  plan)  shall  cease  to  be a plan offered by the city,
except as specified in subparagraphs (4) and (5)  below,  and
shall be closed to new enrollment or transfer of coverage for
any  non-Medicare  Plan annuitant as of the effective date of
this  amendatory  Act  of  1997.   The   city   shall   offer
non-Medicare  Plan  annuitants  and their eligible dependents
the option of enrolling in its Annuitant  Preferred  Provider
Plan,  and may offer additional plans for any annuitant.  The
city may amend, modify, or terminate any  of  its  additional
plans  at  its sole discretion.  If the city offers more than
one annuitant  plan,  the  city  shall  allow  annuitants  to
convert  coverage  from  one  city annuitant plan to another,
except the basic city plan, during times  designated  by  the
city,  which  periods  of time shall occur at least annually.
For the  period  dating  from  the  effective  date  of  this
amendatory Act of 1997 through June 30, 2002, monthly premium
rates  may  be  increased  for  annuitants during the time of
their participation in non-Medicare plans, except as provided
in subparagraphs (1) through (4) of this subsection.
         (1)  For non-Medicare Plan  annuitants  who  retired
    prior  to  January  1,  1988,  the  annuitant's  share of
    monthly premium for non-Medicare Plan coverage only shall
    not exceed the highest premium rate chargeable under  any
    city  non-Medicare Plan annuitant coverage as of December
    1, 1996.
         (2)  For non-Medicare Plan annuitants who retire  on
    or  after  January  1,  1988,  the  annuitant's  share of
    monthly premium for non-Medicare Plan coverage only shall
    be the rate in effect on December 1, 1996,  with  monthly
    premium  increases to take effect no sooner than April 1,
    1998 at the lower of  (i)  the  premium  rate  determined
    pursuant to subsection (g) or (ii) 10% of the immediately
    previous month's rate for similar coverage.
         (3)  In   no   event  shall  any  non-Medicare  Plan
    annuitant's share of  monthly  premium  for  non-Medicare
    Plan  coverage  exceed  10%  of  the  annuitant's monthly
    annuity.
         (4)  Non-Medicare Plan annuitants who  are  enrolled
    in  the  basic city plan as of July 1, 1998 may remain in
    the basic city plan, if they so choose, on the  condition
    that they are not entitled to the caps on rates set forth
    in  subparagraphs (1) through (3), and their premium rate
    shall  be  the  rate  determined   in   accordance   with
    subsections (c) and (g).
         (5)  Medicare  Plan  annuitants  who  are  currently
    enrolled  in  the  basic  city plan for Medicare eligible
    annuitants may remain in that plan, if  they  so  choose,
    through  June  30, 2002.  Annuitants shall not be allowed
    to enroll in or transfer into the  basic  city  plan  for
    Medicare  eligible  annuitants  on or after July 1, 1999.
    The  city  shall   continue   to   offer   annuitants   a
    supplemental   Medicare   Plan   for   Medicare  eligible
    annuitants through June 30, 2002, and the city may  offer
    additional  plans  to Medicare eligible annuitants in its
    sole discretion.  All  Medicare  Plan  annuitant  monthly
    rates  shall be determined in accordance with subsections
    (c) and (g).
    (c)  Effective the date the initial  increased  annuitant
payments  pursuant  to  subsection (g) take effect,  The city
shall pay 50% of  the  aggregated  costs  of  the  claims  or
premiums,   whichever   is   applicable,   as  determined  in
accordance with  subsection  (g),  of  annuitants  and  their
dependents  under  all health care plans offered by the city.
The city may reduce its obligation by  application  of  price
reductions  obtained  as  a  result of financial arrangements
with  providers  or  plan  administrators.   The  claims   or
premiums  of all annuitants and their dependents under all of
the plans offered by the city shall  be  aggregated  for  the
purpose of calculating the city's payment required under this
subsection,  as  well  as for the setting of rates of payment
for annuitants as required under subsection (g).
    (d)  From January 1, 1988 until December  31,  1992,  the
board  shall pay to the city on behalf of each of the board's
annuitants who chooses to participate in any  of  the  city's
plans the following amounts: up to a maximum of $65 per month
for  each  such  annuitant  who  is  not qualified to receive
medicare benefits, and up to a maximum of $35 per  month  for
each  such  annuitant  who  is  qualified to receive medicare
benefits.  From January 1, 1993 until June 30, 2002  December
31,  1997,  the board shall pay to the city on behalf of each
of the board's annuitants who chooses to participate  in  any
of the city's plans the following amounts: up to a maximum of
$75 per month for each such annuitant who is not qualified to
receive  medicare  benefits,  and  up to a maximum of $45 per
month for each such annuitant who  is  qualified  to  receive
medicare benefits.
    For the period January 1, 1988 through the effective date
of  this  amendatory Act of 1989, payments under this Section
shall be reduced by the amounts paid by or on behalf  of  the
board's annuitants covered during that period.
    The  payments  described in this subsection shall be paid
from the  tax  levy  authorized  under  Section  5-168;  such
amounts  shall  be credited to the reserve for group hospital
care and group medical and surgical plan  benefits,  and  all
payments  to the city required under this subsection shall be
charged against it.
    (e)  The city's obligations under subsections (b) and (c)
shall terminate on June 30, 2002 December  31,  1997,  except
with  regard  to covered expenses incurred but not paid as of
that  date.   This  subsection   shall   not   affect   other
obligations that may be imposed by law.
    (f)  The  group  coverage plans described in this Section
are  not  and  shall  not  be  construed  to  be  pension  or
retirement benefits for purposes of Section 5 of Article XIII
of the Illinois Constitution of 1970.
    (g)  For each annuitant plan offered  by  the  city,  the
aggregate  cost  of claims, as reflected in the claim records
of the plan administrator, and  premiums  for  each  calendar
year  from 1989 through 1997 of all annuitants and dependents
covered by the  city's  group  health  care  plans  shall  be
estimated  by the city, based upon a written determination by
a qualified independent actuary to be appointed and  paid  by
the  city  and  the board.  If the such estimated annual cost
for each annuitant plan offered by the city is more than  the
estimated  amount to be contributed by the city for that plan
pursuant to subsections (b) and (c) during that year plus the
estimated amounts to be paid pursuant to subsection  (d)  and
by  the other pension boards on behalf of other participating
annuitants, the difference shall be paid by all participating
annuitants participating in the plan, except as  provided  in
subsection  (b).   The  city, based upon the determination of
the independent actuary, shall set the monthly amounts to  be
paid   by   the   participating   annuitants.    The  initial
determination of such payments shall be prospective only  and
shall  be  based  upon the estimated costs for the balance of
the year.  The board may deduct the amounts to be paid by its
annuitants  from  the   participating   annuitants'   monthly
annuities.
    If it is determined from the city's annual audit, or from
audited  experience  data,  that the total amount paid by all
participating annuitants was more or less than the difference
between (1) the cost  of  providing  the  group  health  care
plans,  and  (2) the sum of the amount to be paid by the city
as determined under subsection (c) and the  amounts  paid  by
all  the pension boards, then the independent actuary and the
city shall account for the excess or shortfall  in  the  next
year's   payments   by  annuitants,  except  as  provided  in
subsection (b).
    (h)  An annuitant may elect to terminate  coverage  in  a
plan  at  the end of any month any time, which election shall
terminate the annuitant's  obligation  to  contribute  toward
payment of the excess described in subsection (g).
    (i)  The  city  shall  advise  the  board of all proposed
premium increases for health care at least 75 days  prior  to
the  effective  date of the change, and any increase shall be
prospective only.
(Source: P.A. 86-273.)

    (40 ILCS 5/5-237)
    Sec. 5-237. Transfer of creditable service to  Article  9
fund.
    (a)  Any  person  who  is  an  active  participant in the
pension fund established under Article 9 of this Code and who
was employed  by  the  office  of  the  Cook  County  State's
Attorney  on January 1, 1995 may apply for transfer of his or
her credits and creditable service accumulated in  this  Fund
to   that   Article  9  fund.   Upon  receipt  of  a  written
application to make this transfer, the Fund shall pay to  the
Article 9 fund an amount consisting of:
         (1)  the  amounts  credited to the applicant through
    employee contributions, plus accumulated interest; plus
         (2)  an     amount     representing     municipality
    contributions, equal to the amount determined under  item
    (1); plus
         (3)  any  interest  paid  to  the  Fund  in order to
    reinstate credits and creditable service under subsection
    (b).
Participation in this Fund shall terminate on the date of the
transfer.
    (a-5)  Until July 1, 1998, any person who  is  an  active
participant  in  the pension fund established under Article 9
of this Code and a member of the county police department  as
defined  in  Section 9-128.1 may apply for transfer of his or
her credits and creditable service accumulated in  this  Fund
to   that   Article  9  fund.   Upon  receipt  of  a  written
application to make this transfer, the Fund shall pay to  the
Article 9 fund an amount consisting of:
         (1)  the  amounts  credited to the applicant through
    employee contributions, plus accumulated interest; plus
         (2)  an     amount     representing     municipality
    contributions, equal to the amount determined under  item
    (1); plus
         (3)  any  interest  paid  to  the  Fund  in order to
    reinstate credits and creditable service under subsection
    (b).
Participation in this Fund shall terminate on the date of the
transfer.
    (b)  As part of a transfer under subsection (a) or (a-5),
a person may reinstate credits and  creditable  service  that
was  terminated  upon  receipt  of a refund, by paying to the
Fund the amount of the refund plus interest  thereon  at  the
rate  of  6%  per year, compounded annually, from the date of
the refund to the date of payment.
(Source: P.A. 89-136, eff. 7-14-95.)

    (40 ILCS 5/6-164.2) (from Ch. 108 1/2, par. 6-164.2)
    Sec. 6-164.2.  Group health benefit.
    (a)  For the purposes of this  Section:  (1)  "annuitant"
means  a person receiving an age and service annuity, a prior
service annuity, a widow's annuity, a widow's  prior  service
annuity,  or  a  minimum annuity on or after January 1, 1988,
under Article 5, 6, 8 or 11, by reason of previous employment
by the City of Chicago (hereinafter, in  this  Section,  "the
city");  (2)  "Medicare  Plan  annuitant"  means an annuitant
described in item (1) who is eligible for Medicare  benefits;
and  (3)  "non-Medicare  Plan  annuitant"  means an annuitant
described in item  (1)  who  is  not  eligible  for  Medicare
benefits.
    (b)  The  city  shall  continue  to  offer  group  health
benefits  to annuitants and their eligible dependents through
June  30,  2002.   The  same  basic  city  health  care  plan
available as of June 30, 1988 (hereinafter called  the  basic
city  plan)  shall  cease  to  be a plan offered by the city,
except as specified in subparagraphs (4) and (5)  below,  and
shall be closed to new enrollment or transfer of coverage for
any  non-Medicare  Plan annuitant as of the effective date of
this  amendatory  Act  of  1997.   The   city   shall   offer
non-Medicare  Plan  annuitants  and their eligible dependents
the option of enrolling in its Annuitant  Preferred  Provider
Plan,  and may offer additional plans for any annuitant.  The
city may amend, modify, or terminate any  of  its  additional
plans  at  its sole discretion.  If the city offers more than
one annuitant  plan,  the  city  shall  allow  annuitants  to
convert  coverage  from  one  city annuitant plan to another,
except the basic city plan, during times  designated  by  the
city,  which  periods  of time shall occur at least annually.
For the  period  dating  from  the  effective  date  of  this
amendatory  Act  of  1997  through   June  30,  2002, monthly
premium rates may be increased for annuitants during the time
of their  participation  in  non-Medicare  plans,  except  as
provided in subparagraphs (1) through (4) of this subsection.
         (1)  For  non-Medicare  Plan  annuitants who retired
    prior to  January  1,  1988,  the  annuitant's  share  of
    monthly premium for non-Medicare Plan coverage only shall
    not  exceed the highest premium rate chargeable under any
    city non-Medicare Plan annuitant coverage as of  December
    1, 1996.
         (2)  For  non-Medicare Plan annuitants who retire on
    or after  January  1,  1988,  the  annuitant's  share  of
    monthly premium for non-Medicare Plan coverage only shall
    be  the  rate in effect on December 1, 1996, with monthly
    premium increases to take effect no sooner than April  1,
    1998  at  the  lower  of  (i) the premium rate determined
    pursuant to subsection (g) or (ii) 10% of the immediately
    previous month's rate for similar coverage.
         (3)  In  no  event  shall  any   non-Medicare   Plan
    annuitant's  share  of  monthly  premium for non-Medicare
    Plan coverage  exceed  10%  of  the  annuitant's  monthly
    annuity.
         (4)  Non-Medicare  Plan  annuitants who are enrolled
    in the basic city plan as of July 1, 1998 may  remain  in
    the  basic city plan, if they so choose, on the condition
    that they are not entitled to the caps on rates set forth
    in subparagraphs (1) through (3), and their premium  rate
    shall   be   the   rate  determined  in  accordance  with
    subsections (c) and (g).
         (5)  Medicare  Plan  annuitants  who  are  currently
    enrolled in the basic city  plan  for  Medicare  eligible
    annuitants  may  remain  in that plan, if they so choose,
    through June 30, 2002.  Annuitants shall not  be  allowed
    to  enroll  in  or  transfer into the basic city plan for
    Medicare eligible annuitants on or after  July  1,  1999.
    The   city   shall   continue   to   offer  annuitants  a
    supplemental  Medicare   Plan   for   Medicare   eligible
    annuitants  through June 30, 2002, and the city may offer
    additional plans to Medicare eligible annuitants  in  its
    sole  discretion.   All  Medicare  Plan annuitant monthly
    rates shall be determined in accordance with  subsections
    (c) and (g).
    (c)  Effective  the  date the initial increased annuitant
payments pursuant to subsection (g)  take  effect,  The  city
shall  pay  50%  of  the  aggregated  costs  of the claims or
premiums,  whichever  is   applicable,   as   determined   in
accordance  with  subsection  (g),  of  annuitants  and their
dependents under all health care plans offered by  the  city.
The  city  may  reduce its obligation by application of price
reductions obtained as a  result  of  financial  arrangements
with   providers  or  plan  administrators.   The  claims  or
premiums of all annuitants and their dependents under all  of
the  plans  offered  by  the city shall be aggregated for the
purpose of calculating the city's payment required under this
subsection, as well as for the setting of  rates  of  payment
for annuitants as required under subsection (g).
    (d)  From  January  1,  1988 until December 31, 1992, the
board shall pay to the city on behalf of each of the  board's
annuitants  who  chooses  to participate in any of the city's
plans the following amounts: up to a maximum of $65 per month
for each such annuitant  who  is  not  qualified  to  receive
medicare  benefits,  and up to a maximum of $35 per month for
each such annuitant who  is  qualified  to  receive  medicare
benefits.   From January 1, 1993 until June 30, 2002 December
31, 1997, the board shall pay to the city on behalf  of  each
of  the  board's annuitants who chooses to participate in any
of the city's plans the following amounts: up to a maximum of
$75 per month for each such annuitant who is not qualified to
receive medicare benefits, and up to a  maximum  of  $45  per
month  for  each  such  annuitant who is qualified to receive
medicare benefits.
    For the period January 1, 1988 through the effective date
of this amendatory Act of 1989, payments under  this  Section
shall  be  reduced by the amounts paid by or on behalf of the
board's annuitants covered during that period.
    The payments described in this subsection shall  be  paid
from  the  tax  levy  authorized  under  Section  6-165; such
amounts shall be credited to the reserve for  group  hospital
care  and  group  medical and surgical plan benefits, and all
payments to the city required under this subsection shall  be
charged against it.
    (e)  The city's obligations under subsections (b) and (c)
shall  terminate  on  June 30, 2002 December 31, 1997, except
with regard to covered expenses incurred but not paid  as  of
that   date.    This   subsection   shall  not  affect  other
obligations that may be imposed by law.
    (f)  The group coverage plans described in  this  Section
are  not  and  shall  not  be  construed  to  be  pension  or
retirement benefits for purposes of Section 5 of Article XIII
of the Illinois Constitution of 1970.
    (g)  For  each  annuitant  plan  offered by the city, the
aggregate cost of claims, as reflected in the  claim  records
of  the  plan  administrator,  and premiums for each calendar
year from 1989 through 1997 of all annuitants and  dependents
covered  by  the  city's  group  health  care  plans shall be
estimated by the city, based upon a written determination  by
a  qualified  independent actuary to be appointed and paid by
the city and the board.  If the such  estimated  annual  cost
for  each annuitant plan offered by the city is more than the
estimated amount to be contributed by the city for that  plan
pursuant to subsections (b) and (c) during that year plus the
estimated  amounts  to be paid pursuant to subsection (d) and
by the other pension boards on behalf of other  participating
annuitants, the difference shall be paid by all participating
annuitants  participating  in the plan, except as provided in
subsection (b).  The city, based upon  the  determination  of
the  independent actuary, shall set the monthly amounts to be
paid  by   the   participating   annuitants.    The   initial
determination  of such payments shall be prospective only and
shall be based upon the estimated costs for  the  balance  of
the year.  The board may deduct the amounts to be paid by its
annuitants   from   the   participating  annuitants'  monthly
annuities.
    If it is determined from the city's annual audit, or from
audited experience data, that the total amount  paid  by  all
participating annuitants was more or less than the difference
between  (1)  the  cost  of  providing  the group health care
plans, and (2) the sum of the amount to be paid by  the  city
as  determined  under  subsection (c) and the amounts paid by
all the pension boards, then the independent actuary and  the
city  shall  account  for the excess or shortfall in the next
year's  payments  by  annuitants,  except  as   provided   in
subsection (b).
    (h)  An  annuitant  may  elect to terminate coverage in a
plan at the end of any month any time, which  election  shall
terminate  the  annuitant's  obligation  to contribute toward
payment of the excess described in subsection (g).
    (i)  The city shall advise  the  board  of  all  proposed
premium  increases  for health care at least 75 days prior to
the effective date of the change, and any increase  shall  be
prospective only.
(Source: P.A. 86-273.)

    (40 ILCS 5/7-139.8) (from Ch. 108 1/2, par. 7-139.8)
    Sec. 7-139.8.  Transfer to Article 14 System.
    (a) Any  active member of the State Employees' Retirement
System who is an investigator for the Office of  the  State's
Attorneys  Appellate  Prosecutor  or  a  controlled substance
inspector may apply for transfer of his or  her  credits  and
creditable  service accumulated in this Fund for service as a
sheriff's law enforcement employee to  the  State  Employees'
Retirement  System  in  accordance  with Section 14-110.  The
creditable service shall be transferred only upon payment  by
this  Fund  to  the  State Employees' Retirement System of an
amount equal to:
         (1)  the amounts accumulated to the  credit  of  the
    applicant  for  service  as  a  sheriff's law enforcement
    employee, including interest; and
         (2)  municipality credits  based  on  such  service,
    including interest; and
         (3)  any interest paid by the applicant to reinstate
    such service.
Participation  in  this  Fund  as  to any credits transferred
under this Section shall terminate on the date of transfer.
    (b)  Any such investigator  or  inspector  may  reinstate
credits  and  creditable service terminated upon receipt of a
separation benefit, by paying to the Fund the amount  of  the
separation  benefit  plus  interest thereon at the rate of 6%
per year to the date of payment.
(Source: P.A. 87-1265.)

    (40 ILCS 5/7-141.1)
    Sec. 7-141.1. Early retirement incentive.
    (a)  The General Assembly finds and declares that:
         (1)  Units of local government across the State have
    been functioning under a financial crisis.
         (2)  This financial crisis is expected to continue.
         (3)  Units  of  local  government  must  depend   on
    additional sources of revenue and, when those sources are
    not forthcoming, must establish cost-saving programs.
         (4)  An    early   retirement   incentive   designed
    specifically to target highly-paid senior employees could
    result in significant annual cost savings.
         (5)  The early retirement incentive should  be  made
    available  only  to  those units of local government that
    determine that an early retirement incentive is in  their
    best interest.
         (6)  A  unit  of local government adopting a program
    of early retirement  incentives  under  this  Section  is
    encouraged to implement personnel procedures to prohibit,
    for at least 5 years, the rehiring (whether on payroll or
    by  independent  contract) of employees who receive early
    retirement incentives.
         (7)  A unit of local government adopting  a  program
    of early retirement incentives under this Section is also
    encouraged   to  replace  as  few  of  the  participating
    employees as possible and to hire  replacement  employees
    for  salaries  totaling  no  more  than  80% of the total
    salaries formerly paid to the employees  who  participate
    in the early retirement program.
    It  is  the  primary purpose of this Section to encourage
units of local government that can realize true cost savings,
or have determined that an early  retirement  program  is  in
their   best  interest,  to  implement  an  early  retirement
program.
    (b)  Until the effective date of this amendatory  Act  of
1997,  this  Section does not apply to any employer that is a
city, village, or incorporated town, nor to the employees  of
any  such  employer.  Beginning on the effective date of this
amendatory Act of 1997,  any  employer  under  this  Article,
including   an   employer   that   is  a  city,  village,  or
incorporated  town,   may  establish  an   early   retirement
incentive  program for its employees under this Section.  The
decision of a city, village, or incorporated town to consider
or establish an early  retirement  program  is  at  the  sole
discretion  of  that city, village, or incorporated town, and
nothing in this amendatory Act of 1997  limits  or  otherwise
diminishes   this  discretion.   Nothing  contained  in  this
Section shall be construed to require  a  city,  village,  or
incorporated  town  to  establish an early retirement program
and no city, village, or incorporated town may  be  compelled
to  implement such a program.  All references in this Section
to  an  "employer"  or  "unit  of   local   government"   are
specifically  intended  to  exclude  every employer that is a
city, village, or incorporated town.
    The benefits provided in this Section are available  only
to  members  employed  by  a  participating employer that has
filed with the Board of the Fund a  resolution  or  ordinance
expressly  providing  for the creation of an early retirement
incentive program under this Section for  its  employees  and
specifying   the  effective  date  of  the  early  retirement
incentive program.  Subject to the limitation  in  subsection
(h),   an  employer  may  adopt  a  resolution  or  ordinance
providing a program of early retirement incentives under this
Section at any time, but no more often than once in 5  years.
    The resolution or ordinance shall be in substantially the
following form:

               RESOLUTION (ORDINANCE) NO. ....
         A RESOLUTION (ORDINANCE) ADOPTING AN EARLY
         RETIREMENT INCENTIVE PROGRAM FOR EMPLOYEES
          IN THE ILLINOIS MUNICIPAL RETIREMENT FUND
    WHEREAS,  Section  7-141.1  of  the Illinois Pension Code
provides that a participating employer may elect to adopt  an
early  retirement  incentive  program offered by the Illinois
Municipal  Retirement  Fund  by  adopting  a  resolution   or
ordinance; and
    WHEREAS, The goal of adopting an early retirement program
is  to  realize  a  substantial savings in personnel costs by
offering early retirement incentives to  employees  who  have
accumulated many years of service credit; and
    WHEREAS,  Implementation  of the early retirement program
will provide a budgeting tool to aid in  controlling  payroll
costs; and
    WHEREAS, The (name of governing body) has determined that
the  adoption  of an early retirement incentive program is in
the best interests of the (name of  participating  employer);
therefore be it
    RESOLVED  (ORDAINED)  by  the (name of governing body) of
(name of participating employer) that:
    (1)  The (name of  participating  employer)  does  hereby
adopt the Illinois Municipal Retirement Fund early retirement
incentive  program  as  provided  in  Section  7-141.1 of the
Illinois  Pension  Code.   The  early  retirement   incentive
program shall take effect on (date).
    (2)  In  order  to  help  achieve  a true cost savings, a
person who  retires  under  the  early  retirement  incentive
program  shall  lose  those  incentives  if  he  or she later
accepts employment with any IMRF employer in a  position  for
which  participation in IMRF is required or is elected by the
employee.
    (3)  In order to utilize an early retirement incentive as
a budgeting tool, the (name of participating  employer)  will
use  its best efforts either to limit the number of employees
who  replace  the  employees  who  retire  under  the   early
retirement  program  or  to  limit  the  salaries paid to the
employees who replace the  employees  who  retire  under  the
early retirement program.
    (4)  The  effective  date  of  each employee's retirement
under this early retirement program shall be set by (name  of
employer)  and shall be no earlier than the effective date of
the program and no later than one year after  that  effective
date;   except   that  the  employee  may  require  that  the
retirement date set by the employer be no later than the June
30 next occurring after the effective date of the program and
no earlier than the date upon which  the  employee  qualifies
for retirement.
    (5)  To  be  eligible  for the early retirement incentive
under this Section, the employee must have  attained  age  50
and  have  at  least 20 years of creditable service by his or
her retirement date.
    (6)  The (clerk  or  secretary)  shall  promptly  file  a
certified  copy of this resolution (ordinance) with the Board
of Trustees of the Illinois Municipal Retirement Fund.
CERTIFICATION
    I, (name), the (clerk  or  secretary)  of  the  (name  of
participating  employer)  of  the  County of (name), State of
Illinois, do hereby certify that I am the keeper of the books
and records of the (name of employer) and that the  foregoing
is  a  true and correct copy of a resolution (ordinance) duly
adopted by the (governing body) at a  meeting  duly  convened
and held on (date).
SEAL
(Signature of clerk or secretary)

    (c)  To  be  eligible  for the benefits provided under an
early  retirement  incentive  program  adopted   under   this
Section, a member must:
         (1)  be  a  participating employee of this Fund who,
    on the effective date of the program, (i)  is  in  active
    payroll status as an employee of a participating employer
    that  has filed the required ordinance or resolution with
    the Board, (ii) is on layoff status from such a  position
    with a right of re-employment or recall to service, (iii)
    is on a leave of absence from such a position, or (iv) is
    on  disability  but has not been receiving benefits under
    Section 7-146 or 7-150 for a period of more than 2  years
    from the date of application;
         (2)  have  never  previously  received  a retirement
    annuity  under  this  Article  or  under  the  Retirement
    Systems Reciprocal Act using service  credit  established
    under this Article;
         (3)  file  with  the  Board  within  60  days of the
    effective date of the program an  application  requesting
    the benefits provided in this Section;
         (4)  have at least 20 years of creditable service in
    the  Fund  by  the date of retirement, without the use of
    any creditable service established under this Section;
         (5)  have attained age 50 by the date of retirement,
    without the use of any  age  enhancement  received  under
    this Section; and
         (6)  be  eligible  to  receive  a retirement annuity
    under this Article by the date of retirement,  for  which
    purpose   the  age  enhancement  and  creditable  service
    established under this Section may be considered.
    (d)  The employer shall determine the retirement date for
each employee participating in the early  retirement  program
adopted  under this Section.  The retirement date shall be no
earlier than the effective date of the program and  no  later
than  one  year  after  that  effective date, except that the
employee may require that the  retirement  date  set  by  the
employer  be  no  later than the June 30 next occurring after
the effective date of the program and  no  earlier  than  the
date  upon  which the employee qualifies for retirement.  The
employer shall give each employee participating in the  early
retirement  program  at  least  30 days written notice of the
employee's designated retirement date,  unless  the  employee
waives this notice requirement.
    (e)  An  eligible  person  may establish up to 5 years of
creditable service under this Section.  In addition, for each
period of creditable service established under this  Section,
a  person  shall  have  his  or  her age at retirement deemed
enhanced by an equivalent period.
    The creditable service established under this Section may
be  used  for  all  purposes  under  this  Article  and   the
Retirement Systems Reciprocal Act, except for the computation
of  final rate of earnings and the determination of earnings,
salary, or compensation under this or any  other  Article  of
the Code.
    The age enhancement established under this Section may be
used   for   all   purposes  under  this  Article  (including
calculation  of  the  reduction  imposed  under   subdivision
(a)1b(iv)  of  Section  7-142),   except  for  purposes  of a
reversionary   annuity   under   Section   7-145   and    any
distributions  required  because of age.  The age enhancement
established under this Section may be used in  calculating  a
proportionate   annuity   payable  by  this  Fund  under  the
Retirement Systems Reciprocal Act, but shall not be  used  in
determining  benefits  payable  under  other Articles of this
Code under the Retirement Systems Reciprocal Act.
    (f)  For all creditable service  established  under  this
Section,  the  member  must  pay  to  the  Fund  an  employee
contribution  consisting  of  4.5%  of  the  member's highest
annual salary rate used in the  determination  of  the  final
rate  of  earnings  for  retirement annuity purposes for each
year of creditable service granted under this  Section.   For
creditable service established under this Section by a person
who  is  a  sheriff's  law  enforcement employee to be deemed
service as a sheriff's law enforcement employee, the employee
contribution shall be at the rate of 6.5% of  highest  annual
salary per year of creditable service granted.  Contributions
for  fractions  of  a year of service shall be prorated.  Any
amounts that are disregarded in determining the final rate of
earnings under subdivision (d)(5) of Section 7-116 (the  125%
rule)  shall  also be disregarded in determining the required
contribution under this subsection (f).
    The employee contribution shall be paid to  the  Fund  as
follows:  If the member is entitled to a lump sum payment for
accumulated  vacation,  sick  leave,  or  personal leave upon
withdrawal  from  service,  the  employer  shall  deduct  the
employee contribution from that lump sum and pay the deducted
amount directly to the Fund.  If there is no  such  lump  sum
payment or the required employee contribution exceeds the net
amount  of  the  lump  sum payment, then the remaining amount
due, at the option of the employee, may either be paid to the
Fund before  the  annuity  commences  or  deducted  from  the
retirement annuity in 24 equal monthly installments.
    (g)  An annuitant who has received any age enhancement or
creditable  service under this Section and thereafter accepts
employment with or enters into a personal  services  contract
with an employer under this Article thereby forfeits that age
enhancement  and  creditable  service.   A  person forfeiting
early retirement incentives under this  subsection  (i)  must
repay  to  the  Fund  that  portion of the retirement annuity
already  received  which  is  attributable   to   the   early
retirement  incentives  that  are being forfeited, (ii) shall
not be eligible to participate in any future early retirement
program adopted under this Section, and (iii) is entitled  to
a  refund  of the employee contribution paid under subsection
(f).  The Board shall deduct the required repayment from  the
refund  and  may  impose  a  reasonable  payment schedule for
repaying the amount, if any, by which the required  repayment
exceeds the refund amount.
    (h)  The  additional  unfunded  liability  accruing  as a
result of the adoption  of  a  program  of  early  retirement
incentives  under  this  Section  by  an  employer  shall  be
amortized over a period of 10 years beginning on January 1 of
the second calendar year following the calendar year in which
the latest date for beginning to receive a retirement annuity
under  the  program  (as  determined  by  the  employer under
subsection (d) of  this  Section)  occurs;  except  that  the
employer may provide for a shorter amortization period (of no
less  than  5  years)  by adopting an ordinance or resolution
specifying  the  length  of  the  amortization   period   and
submitting a certified copy of the ordinance or resolution to
the  Fund  no later than 6 months after the effective date of
the program.  An employer, at its discretion, may  accelerate
payments to the Fund.
    An  employer  may  provide more than one early retirement
incentive program  for  its  employees  under  this  Section.
However,  an  employer  that has provided an early retirement
incentive program for its employees under  this  Section  may
not  provide another early retirement incentive program under
this Section until (1) the liability arising from the earlier
program has been fully paid to the Fund and (2)  at  least  6
years  have  elapsed  from the effective date of the previous
program.
(Source: P.A. 89-329, eff. 8-17-95.)

    (40 ILCS 5/7-145.1 new)
    Sec. 7-145.1.  Alternative annuity for county officers.
    (a)  The benefits provided in this  Section  and  Section
7-145.2 are available only if the county board has filed with
the  Board  of  the  Fund a resolution or ordinance expressly
consenting to the availability  of  these  benefits  for  its
elected  county  officers.   The  county  board's  consent is
irrevocable.
    An  elected  county  officer  may  elect   to   establish
alternative credits for an alternative annuity by electing in
writing   to   make   additional  optional  contributions  in
accordance with this Section and  procedures  established  by
the board.  The elected county officer may discontinue making
the  additional  optional contributions by notifying the Fund
in writing in accordance with  this  Section  and  procedures
established by the board.
    Additional  optional  contributions  for  the alternative
annuity shall be as follows:
         (1)  For service after the  option  is  elected,  an
    additional   contribution   of  3%  of  salary  shall  be
    contributed to the Fund on the same basis and  under  the
    same  conditions  as contributions required under Section
    7-173.
         (2)  For service before the option  is  elected,  an
    additional  contribution  of  3%  of  the  salary for the
    applicable  period  of  service,  plus  interest  at  the
    effective rate from the date of service to  the  date  of
    payment.   All  payments for past service must be paid in
    full before credit  is  given.   No  additional  optional
    contributions  may  be made for any period of service for
    which credit has been previously forfeited by  acceptance
    of  a  refund,  unless  the refund is repaid in full with
    interest at the effective rate from the date of refund to
    the date of repayment.
    (b)  In lieu of the retirement annuity otherwise  payable
under  this  Article,  an  elected county officer who (1) has
elected to  participate  in  the  Fund  and  make  additional
optional  contributions  in  accordance with this Section and
(2) has attained age 55 with at  least  8  years  of  service
credit  (or  has  attained  age  50 with at least 20 years of
service as a sheriff's law enforcement employee) may elect to
have his retirement annuity computed as follows:  3%  of  the
participant's  salary  at  the time of termination of service
for each of the first 8 years of service credit, plus  4%  of
that  salary  for each of the next 4 years of service credit,
plus 5% of that salary for each year  of  service  credit  in
excess  of  12  years,  subject  to  a maximum of 80% of that
salary.  To the extent that the elected  county  officer  has
made additional optional contributions with respect to only a
portion  of  his  years  of  service  credit,  his retirement
annuity will first be  determined  in  accordance  with  this
Section  to the extent that additional optional contributions
were made, and then in accordance with the remaining Sections
of this Article to the extent of years of service credit with
respect to which additional optional contributions  were  not
made.
    (c)  In lieu of the disability benefits otherwise payable
under  this  Article,  an  elected county officer who (1) has
elected to participate  in  the  Fund,  and  (2)  has  become
permanently  disabled  and  as  a  consequence  is  unable to
perform the duties of his office, and (3) was making optional
contributions in accordance with this Section at the time the
disability was incurred, may elect to  receive  a  disability
annuity   calculated   in  accordance  with  the  formula  in
subsection (b).  For the  purposes  of  this  subsection,  an
elected   county  officer  shall  be  considered  permanently
disabled only if:  (i) disability occurs while in service  as
an  elected  county  officer  and  is  of such a nature as to
prevent him from reasonably  performing  the  duties  of  his
office at the time; and (ii) the board has received a written
certification  by at least 2 licensed physicians appointed by
it  stating  that  the  officer  is  disabled  and  that  the
disability is likely to be permanent.
    (d)  Refunds of additional optional  contributions  shall
be  made  on  the same basis and under the same conditions as
provided under Section  7-166,  7-167  and  7-168.   Interest
shall be credited at the effective rate on the same basis and
under the same conditions as for other contributions.
    (e)  The   plan  of  optional  alternative  benefits  and
contributions shall be available to persons who  are  elected
county  officers  and  active  contributors to the Fund on or
after November 15, 1994.  A person who was an elected  county
officer and an active contributor to the Fund on November 15,
1994 but is no longer an active contributor may apply to make
additional  optional  contributions under this Section at any
time  within  90  days  after  the  effective  date  of  this
amendatory Act of 1997; if the person is  an  annuitant,  the
resulting  increase  in  annuity shall begin to accrue on the
first day of the month  following  the  month  in  which  the
required payment is received by the Fund.
    (f)  For   the  purposes  of  this  Section  and  Section
7-145.2, the terms  "elected  county  officer"  and  "elected
county  office"  include,  but  are  not  limited to: (1) the
county clerk,  recorder,  treasurer,  coroner,  assessor  (if
elected),  auditor, sheriff, and State's Attorney; members of
the county board; and the clerk of the circuit court; and (2)
a person who has been appointed  to  fill  a  vacancy  in  an
office  that  is  normally filled by election on a countywide
basis, for the duration of his or her service in that office.
The  terms  "elected  county  officer"  and  "elected  county
office" do not include any officer or office of a county that
has not consented to the availability of benefits under  this
Section and Section 7-145.2.

    (40 ILCS 5/7-145.2 new)
    Sec.   7-145.2.    Alternative  survivor's  benefits  for
survivors of county officers.
    In lieu of  the  survivor's  benefits  otherwise  payable
under  this  Article,  the  spouse  or  eligible child of any
deceased elected  county  officer  who  (1)  had  elected  to
participate in the Fund, and (2) was either making additional
optional  contributions in accordance with Section 7-145.1 on
the date of death, or was  receiving  an  annuity  calculated
under that Section at the time of death, may elect to receive
an  annuity  beginning  on  the  date  of  the elected county
officer's death, provided that the spouse  and  officer  must
have  been married on the date of the last termination of his
or her service  as  an  elected  county  officer  and  for  a
continuous  period of at least one year immediately preceding
his or her death.
    The annuity shall be payable beginning on the date of the
elected county officer's death if the spouse is then  age  50
or  over,  or beginning at age 50 if the age of the spouse is
less than 50 years.  If a minor unmarried child  or  children
of  the  county  officer, under age 18, also survive, and the
child or children are under the care of the eligible  spouse,
the  annuity  shall  begin  as  of  the  date of death of the
elected county officer without regard to the spouse's age.
    The annuity to a spouse shall be 66 2/3% of the amount of
retirement annuity earned by the elected  county  officer  on
the  date  of  death,  subject to a minimum payment of 10% of
salary, provided that if an eligible  spouse,  regardless  of
age,  has  in  his  or  her  care at the date of death of the
elected county officer any unmarried child or children of the
county officer, under age 18, the minimum  annuity  shall  be
30%  of  the  elected officer's salary, plus 10% of salary on
account of each minor child of the  elected  county  officer,
subject  to  a  combined total payment on account of a spouse
and  minor  children  not  to  exceed  50%  of  the  deceased
officer's salary.  In the event there shall be no spouse   of
the  elected  county  officer  surviving,  or should a spouse
remarry or die while eligible minor  children  still  survive
the elected county officer, each such child shall be entitled
to  an  annuity equal to 20% of salary of the elected officer
subject to a combined total payment on account  of  all  such
children  not  to  exceed 50% of salary of the elected county
officer.  The salary to be used in the calculation  of  these
benefits shall be the same as that prescribed for determining
a retirement annuity as provided in Section 7-145.1.
    Upon  the  death  of  an elected county officer occurring
after termination  of  service  or  while  in  receipt  of  a
retirement  annuity,  the  combined total payment to a spouse
and minor children, or to minor children alone if no eligible
spouse survives, shall be limited to 75%  of  the  amount  of
retirement annuity earned by the county officer.
    Adopted  children  shall  have  status as children of the
elected county officer only if the proceedings  for  adoption
were  commenced  at  least  one year prior to the date of the
elected county officer's death.
    Marriage of a child or attainment of  age  18,  whichever
first  occurs,  shall render the child ineligible for further
consideration in the payment of an annuity to a spouse or  in
the  increase  in  the  amount  thereof.   Upon attainment of
ineligibility of the youngest  minor  child  of  the  elected
county  officer,  the annuity shall immediately revert to the
amount payable  upon  death  of  an  elected  county  officer
leaving  no  minor  children  surviving  him  or her.  If the
spouse is under age 50 at such time, the annuity  as  revised
shall  be deferred until such age is attained.  Remarriage of
a widow or widower  prior  to  attainment  of  age  55  shall
disqualify the spouse from the receipt of an annuity.

    (40 ILCS 5/8-138) (from Ch. 108 1/2, par. 8-138)
    Sec. 8-138.  Minimum annuities - Additional provisions.
    (a)  An  employee who withdraws after age 65 or more with
at least 20 years of service, for whom the amount of age  and
service  and  prior service annuity combined is less than the
amount stated  in  this  Section,  shall  from  the  date  of
withdrawal,  instead  of all annuities otherwise provided, be
entitled to receive an annuity for life of $150 a year,  plus
1  1/2%  for each year of service, to and including 20 years,
and 1 2/3% for each year of service over  20  years,  of  his
highest  average  annual  salary  for any 4 consecutive years
within the last 10 years of service immediately preceding the
date of withdrawal.
    An employee who withdraws  after  20  or  more  years  of
service, before age 65, shall be entitled to such annuity, to
begin not earlier than upon attained age of 55 years if under
such  age  at withdrawal, reduced by 2% for each full year or
fractional part thereof that his attained age  is  less  than
65,  plus  an  additional  2% reduction for each full year or
fractional part thereof that his attained age when annuity is
to begin is less than 60 so that the total reduction  at  age
55 shall be 30%.
    (b)  An employee who withdraws after July 1, 1957, at age
60  or  over,  with 20 or more years of service, for whom the
age and service and prior service annuity combined,  is  less
than  the  amount  stated  in this paragraph, shall, from the
date of withdrawal, instead of such annuities, be entitled to
receive an annuity for life equal to 1 2/3% for each year  of
service,  of  the  highest  average  annual  salary for any 5
consecutive  years  within  the  last  10  years  of  service
immediately preceding the date of withdrawal; provided,  that
in the case of any employee who withdraws on or after July 1,
1971,  such  employee age 60 or over with 20 or more years of
service, shall receive an annuity for life equal to 1.67% for
each of the first 10 years of service; 1.90% for each of  the
next  10  years of service; 2.10% for each year of service in
excess of 20 but not exceeding 30; and 2.30% for each year of
service in excess of 30, based on the highest average  annual
salary  for  any 4 consecutive years within the last 10 years
of service immediately preceding the date of withdrawal.
    An employee who withdraws after July 1, 1957  and  before
January 1, 1988, with 20 or more years of service, before age
60  years  is  entitled to annuity, to begin not earlier than
upon  attained  age  of  55  years,  if  under  such  age  at
withdrawal, as computed  in  the  last  preceding  paragraph,
reduced  0.25% for each full month or fractional part thereof
that his attained age when annuity is to begin is  less  than
60  if  the employee was born before January 1, 1936, or 0.5%
for each such month if the employee  was  born  on  or  after
January 1, 1936.
    Any  employee  born before January 1, 1936, who withdraws
with 20 or more years of service, and any employee with 20 or
more years of service who withdraws on or  after  January  1,
1988,  may  elect  to  receive, in lieu of any other employee
annuity provided in this Section, an annuity for  life  equal
to 1.80% for each of the first 10 years of service, 2.00% for
each  of the next 10 years of service, 2.20% for each year of
service in excess of 20 but not exceeding 30, and  2.40%  for
each  year of service in excess of 30, of the highest average
annual salary for any 4 consecutive years within the last  10
years   of   service   immediately   preceding  the  date  of
withdrawal, to begin not earlier than upon attained age of 55
years, if under such age at  withdrawal,  reduced  0.25%  for
each  full month or fractional part thereof that his attained
age when annuity is to begin is less than 60; except that  an
employee  retiring  on or after January 1, 1988, at age 55 or
over but less than age  60,  having  at  least  35  years  of
service, or an employee retiring on or after July 1, 1990, at
age 55 or over but less than age 60, having at least 30 years
of service, or an employee retiring on or after the effective
date  of  this  amendatory Act of 1997, at age 55 or over but
less than age 60, having at least 25 years of service,  shall
not be subject to the reduction in retirement annuity because
of retirement below age 60.
    However,  in  the  case  of an employee who retired on or
after January 1, 1985 but before January 1, 1988, at  age  55
or  older  and with at least 35 years of service, and who was
subject  under  this  subsection  (b)  to  the  reduction  in
retirement annuity because of retirement below age  60,  that
reduction  shall  cease  to be effective January 1, 1991, and
the retirement annuity shall be recalculated accordingly.
    Any employee who withdraws on or after July 1, 1990, with
20 or more years of service, may elect to receive, in lieu of
any other employee  annuity  provided  in  this  Section,  an
annuity  for  life equal to 2.20% for each year of service of
the highest average annual salary for any 4 consecutive years
within the last 10 years of service immediately preceding the
date of withdrawal, to begin not earlier than  upon  attained
age  of  55  years,  if under such age at withdrawal, reduced
0.25% for each full month or fractional part thereof that his
attained age when annuity is to begin is less than 60; except
that an employee retiring at age 55 or over but less than age
60, having at least 30 years of service, shall not be subject
to the reduction in retirement annuity because of  retirement
below age 60.
    Any employee who withdraws on or after the effective date
of  this  amendatory  Act  of  1997  with 20 or more years of
service may elect to receive, in lieu of any  other  employee
annuity  provided  in this Section, an annuity for life equal
to 2.20%, for each year of service, of  the  highest  average
annual  salary for any 4 consecutive years within the last 10
years  of  service  immediately   preceding   the   date   of
withdrawal,  to begin not earlier than upon attainment of age
55 (age 50 if the employee has at least 30 years of service),
reduced 0.25% for each full  month  or  remaining  fractional
part thereof that the employee's attained age when annuity is
to begin is less than 60; except that an employee retiring at
age 50 or over with at least 30 years of service or at age 55
or  over  with  at  least  25  years  of service shall not be
subject to the reduction in  retirement  annuity  because  of
retirement below age 60.
    The  maximum  annuity  payable  under part (a) and (b) of
this Section shall not exceed 70% of highest  average  annual
salary in the case of an employee who withdraws prior to July
1,  1971,  and 75% if withdrawal takes place on or after July
1, 1971. For the purpose of the minimum annuity  provided  in
this  Section  $1,500 is considered the minimum annual salary
for  any  year;  and  the  maximum  annual  salary  for   the
computation  of  such  annuity  is $4,800 for any year before
1953, $6000 for the years 1953 to 1956,  inclusive,  and  the
actual  annual  salary, as salary is defined in this Article,
for any year thereafter.
    To preserve rights existing on  December  31,  1959,  for
participants  and  contributors  on  that  date  to  the fund
created by the Court and Law  Department  Employees'  Annuity
Act,  who  became  participants  in  the fund provided for on
January 1, 1960, the maximum annual salary to  be  considered
for such persons for the years 1955 and 1956 is $7,500.
    (c)  For  an  employee  receiving disability benefit, his
salary for annuity purposes under paragraphs (a) and  (b)  of
this   Section,   for   all  periods  of  disability  benefit
subsequent to the year 1956,  is  the  amount  on  which  his
disability benefit was based.
    (d)  An  employee with 20 or more years of service, whose
entire  disability  benefit  credit  period  expires   before
attainment  of  age  55  while still disabled for service, is
entitled upon withdrawal to the larger  of  (1)  the  minimum
annuity  provided  above,  assuming  he  is  then age 55, and
reducing such annuity to its actuarial equivalent as  of  his
attained  age  on  such date or (2) the annuity provided from
his age and service and prior service annuity credits.
    (e)  The minimum annuity provisions do not apply  to  any
former  municipal employee receiving an annuity from the fund
who re-enters service as  a  municipal  employee,  unless  he
renders at least 3 years of additional service after the date
of re-entry.
    (f)  An  employee  in  service  on  July  1, 1947, or who
became a contributor after July 1, 1947 and before attainment
of age 70, who withdraws after age  65,  with  less  than  20
years  of  service  for whom the annuity has been fixed under
this Article shall, instead of the annuity so fixed,  receive
an annuity as follows:
    Such amount as he could have received had the accumulated
amounts  for  annuity  been  improved  with  interest  at the
effective  rate  to  the  date  of  his  withdrawal,  or   to
attainment  of age 70, whichever is earlier, and had the city
contributed to such earlier date for age and service  annuity
the  amount  that it would have contributed had he been under
age 65, after the date his annuity was  fixed  in  accordance
with  this  Article,  and  assuming his annuity were computed
from such accumulations as of his age on such  earlier  date.
The  annuity  so  computed shall not exceed the annuity which
would be payable under the other provisions of  this  Section
if  the  employee  was  credited with 20 years of service and
would qualify for annuity thereunder.
    (g)  Instead of the annuity provided in this Article,  an
employee  having  attained  age  65 with at least 15 years of
service who withdraws from service on or after July  1,  1971
and  whose  annuity  computed  under other provisions of this
Article  is  less  than  the  amount  provided   under   this
paragraph, is entitled to a minimum annuity for life equal to
1% of the highest average annual salary, as salary is defined
and  limited  in  this  Section  for  any 4 consecutive years
within the last 10 years of service for each year of service,
plus the sum of $25 for each year  of  service.  The  annuity
shall not exceed 60% of such highest average annual salary.
    (h)  The  minimum  annuities  provided under this Section
shall be paid in equal monthly installments.
    (i)  The amendatory provisions of part  (b)  and  (g)  of
this Section shall be effective July 1, 1971 and apply in the
case  of  every  qualifying  employee withdrawing on or after
July 1, 1971.
    (j)  The amendatory provisions of this amendatory Act  of
1985 (P.A. 84-23) relating to the discount of annuity because
of  retirement  prior  to  attainment  of  age 60, and to the
retirement formula, for those born before  January  1,  1936,
shall  apply  only  to qualifying employees withdrawing on or
after July 18, 1985.
    (k)  Beginning on the effective date of  this  amendatory
Act of 1997 January 1, 1991, the minimum amount of employee's
annuity  shall  be  $550  $350  per  month  for  life for the
following classes of employees, without regard  to  the  fact
that  withdrawal occurred prior to the effective date of this
amendatory Act of 1997 January 1, 1991:
         (1)  any employee annuitant alive  and  receiving  a
    life annuity on the effective date of this amendatory Act
    of 1997 January 1, 1991, except a reciprocal annuity;
         (2)  any  employee  annuitant  alive and receiving a
    term annuity on the effective date of this amendatory Act
    of 1997 January 1, 1991, except a reciprocal annuity;
         (3)  any employee annuitant alive  and  receiving  a
    reciprocal   annuity   on  the  effective  date  of  this
    amendatory Act of 1997 January 1, 1991, whose service  in
    this fund is at least 5 years;
         (4)  any employee annuitant withdrawing after age 60
    on  or after the effective date of this amendatory Act of
    1997 January 1, 1991, with at least 10 years  of  service
    in this fund.
    The  increases  granted  under  items (1), (2) and (3) of
this subsection (k) shall not be limited by any other Section
of this Act.
(Source: P.A. 85-964; 86-1488.)

    (40 ILCS 5/8-150.1) (from Ch. 108 1/2, par. 8-150.1)
    Sec. 8-150.1.  Minimum annuities for widows.   The  widow
(otherwise  eligible for widow's annuity under other Sections
of this Article 8) of an employee hereinafter described,  who
retires  from service or dies while in the service subsequent
to the effective date of this amendatory provision,  and  for
which  widow  the amount of widow's annuity and widow's prior
service annuity combined, fixed or provided  for  such  widow
under  other  provisions  of  this  Article  is less than the
amount provided in this Section, shall, from  and  after  the
date  her  otherwise provided annuity would begin, in lieu of
such otherwise provided widow's  and  widow's  prior  service
annuity,  be  entitled  to  the following indicated amount of
annuity:
    (a)  The widow of any employee who dies while in  service
on  or after the date on which he attains age 60 if the death
occurs before July 1, 1990, or on or after the date on  which
he  attains  age  55  if the death occurs on or after July 1,
1990, with at least 20 years of service, or on or  after  the
date  on  which  he  attains age 50 if the death occurs on or
after the effective date of this amendatory Act of 1997  with
at least 30 years of service, shall be entitled to an annuity
equal to one-half of the amount of annuity which her deceased
husband  would have been entitled to receive had he withdrawn
from the service on the day immediately preceding the date of
his death, conditional upon such widow  having  attained  the
age  of  60  or  more  years on such date if the death occurs
before July 1, 1990, or age 55 or more if the death occurs on
or after July 1, 1990.  Such amount of widow's annuity  shall
not,  however,  exceed  the  sum  of  $500  a  month  if  the
employee's  death  in service occurs before January 23, 1987.
The widow's annuity shall not be limited to a maximum  dollar
amount  if the employee's death in service occurs on or after
January 23, 1987.
    If the employee dies in service before July 1, 1990,  and
if  such  widow of such described employee shall not be 60 or
more years of age on such date of death, the amount  provided
in the immediately preceding paragraph for a widow 60 or more
years  of  age,  shall, in the case of such younger widow, be
reduced by 0.25% for each month that her then attained age is
less than 60 years if the employee was born before January 1,
1936 or dies in service on or after January 1,  1988,  or  by
0.5%  for  each month that her then attained age is less than
60 years if the employee was born on or after  July  1,  1936
and dies in service before January 1, 1988.
    If the employee dies in service on or after July 1, 1990,
and  if  the widow of the employee has not attained age 55 on
or before the employee's date of death, the amount  otherwise
provided in this subsection (a) shall be reduced by 0.25% for
each month that her then attained age is less than 55 years.
    (b)  The widow of any employee who dies subsequent to the
date  of  his retirement on annuity, and who so retired on or
after the date on which he attained the age  of  60  or  more
years  if  retirement  occurs  before  July 1, 1990, or on or
after the date on which he  attained  age  55  if  retirement
occurs  on  or  after July 1, 1990, with at least 20 years of
service, or on or after the date on which he attained age  50
if  the  retirement  occurs on or after the effective date of
this amendatory Act  of  1997  with  at  least  30  years  of
service, shall be entitled to an annuity equal to one-half of
the  amount of annuity which her deceased husband received as
of the date of his retirement on  annuity,  conditional  upon
such widow having attained the age of 60 or more years on the
date  of  her  husband's  retirement on annuity if retirement
occurs before July 1, 1990, or age 55 or more  if  retirement
occurs  on  or  after  July  1, 1990.  Such amount of widow's
annuity shall not, however, exceed the sum of $500 a month if
the employee's death occurs before  January  23,  1987.   The
widow's  annuity  shall  not  be  limited to a maximum dollar
amount if the employee's death occurs on or after January 23,
1987, regardless of the date of retirement; provided that, if
retirement was before  January  23,  1987,  the  employee  or
eligible spouse repays the excess spouse refund with interest
at  the effective rate from the date of refund to the date of
repayment.
    If the date of the employee's retirement  on  annuity  is
before  July  1,  1990,  and  if such widow of such described
employee shall not have attained such age of 60 or more years
on such date of her  husband's  retirement  on  annuity,  the
amount  provided in the immediately preceding paragraph for a
widow 60 or more years of age on the date  of  her  husband's
retirement  on  annuity,  shall,  in  the  case  of such then
younger widow, be reduced by 0.25% for each  month  that  her
then  attained age was less than 60 years if the employee was
born before January 1, 1936 or withdraws from  service on  or
after  January  1,  1988,  or by 0.5% for each month that her
then attained age is less than 60 years if the  employee  was
born  on  or after January 1, 1936 and withdraws from service
before January 1, 1988.
    If the date of the employee's retirement on annuity is on
or after July 1, 1990, and if the widow of the  employee  has
not  attained age 55 by the date of the employee's retirement
on annuity, the amount otherwise provided in this  subsection
(b)  shall  be  reduced by 0.25% for each month that her then
attained age is less than 55 years.
    (c)  The  foregoing  provisions   relating   to   minimum
annuities  for  widows  shall  not  apply to the widow of any
former municipal employee receiving an annuity from the  fund
on August 9, 1965 or on the effective date of this amendatory
provision,  who  re-enters  service  as a municipal employee,
unless such employee renders at least 3 years  of  additional
service after the date of re-entry.
    (d)  In computing the amount of annuity which the husband
specified  in  the  foregoing  paragraphs (a) and (b) of this
Section would have been entitled  to  receive,  or  received,
such  amount shall be the annuity to which such husband would
have been, or was entitled, before reduction in the amount of
his annuity  for  the  purposes  of  the  voluntary  optional
reversionary  annuity  provided  for  in  Sec.  8-139 of this
Article, if such option was elected.
    (e)  The amendatory provisions of part  (a)  and  (b)  of
this  Section  (increasing  the  maximum  from $300 to $400 a
month) shall be effective as of July 1, 1971,  and  apply  in
the  case  of every qualifying widow whose husband dies while
in service on or after July 1, 1971 or withdraws  and  enters
on annuity on or after July 1, 1971.
    (f)  The  amendments  of part (a) and (b) of this Section
by this amendatory Act of 1983 (increasing the  maximum  from
$400  to  $500  a  month) shall be effective as of January 1,
1984 and shall apply in the case of  every  qualifying  widow
whose  husband  dies while in the service on or after January
1, 1984, or withdraws and  enters  on  annuity  on  or  after
January 1, 1984.
    (g)  The  amendatory provisions of this amendatory Act of
1985 relating to annuity discount because of age  for  widows
of employees born before January 1, 1936, shall apply only to
qualifying  widows  of  employees  withdrawing  or  dying  in
service on or after July 18, 1985.
    (h)  Beginning  on  the effective date of this amendatory
Act of 1997 January 1, 1991, the minimum  amount  of  widow's
annuity  shall  be  $500  $300  per  month  for  life for the
following classes of widows, without regard to the fact  that
the  death  of  the  employee occurred prior to the effective
date of this amendatory Act of 1997 January 1, 1991:
         (1)  any widow annuitant alive and receiving a  life
    annuity  on  the effective date of this amendatory Act of
    1997 January 1, 1991, except a reciprocal annuity;
         (2)  any widow annuitant alive and receiving a  term
    annuity  on  the effective date of this amendatory Act of
    1997 January 1, 1991, except a reciprocal annuity;
         (3)  any  widow  annuitant  alive  and  receiving  a
    reciprocal  annuity  on  the  effective  date   of   this
    amendatory  Act  of  1997 January 1, 1991, whose employee
    spouse's service in this fund was at least 5 years;
         (4)  the widow of an employee with at least 10 years
    of service in this fund who dies after retirement, if the
    retirement occurred prior to the effective date  of  this
    amendatory Act of 1997 January 1, 1991;
         (5)  the widow of an employee with at least 10 years
    of  service  in  this  fund who dies after retirement, if
    withdrawal occurs on or after the effective date of  this
    amendatory Act of 1997 January 1, 1991;
         (6)  the  widow  of  an employee who dies in service
    with at least 5 years of service in  this  fund,  if  the
    death in service occurs on or after the effective date of
    this amendatory Act of 1997 January 1, 1991.
    The  increases  granted under items (1), (2), (3) and (4)
of this subsection (h) shall not  be  limited  by  any  other
Section of this Act.
    (i)  The  widow  of  an  employee  who retired or died in
service on or after January 1, 1985 and before July 1,  1990,
at  age  55  or  older, and with at least 35 years of service
credit,  shall  be  entitled  to  have  her  widow's  annuity
increased, effective January 1, 1991, to an amount  equal  to
50%  of  the  retirement  annuity  that the deceased employee
received on the  date  of  retirement,  or  would  have  been
eligible  to  receive  if he had retired on the day preceding
the date of his death in service, provided that if the  widow
had  not  attained  age  60  by  the  date  of the employee's
retirement or death in service, the  amount  of  the  annuity
shall  be  reduced  by  0.25%  for  each  month that her then
attained  age  was  less  than  age  60  if  the   employee's
retirement  or  death in service occurred on or after January
1, 1988, or by 0.5%  for each month that her attained age  is
less  than  age  60  if the employee's retirement or death in
service occurred prior to January 1, 1988.  However, in cases
where a refund of excess contributions  for  widow's  annuity
has  been  paid by the Fund, the increase in benefit provided
by this subsection (i) shall be contingent upon repayment  of
the  refund  to  the Fund with interest at the effective rate
from the date of refund to the date of payment.
    (j)  If a deceased employee  is  receiving  a  retirement
annuity  at  the  time  of  death and that death occurs on or
after the effective date of this amendatory Act of 1997,  the
widow  may  elect  to  receive,  in lieu of any other annuity
provided under this Article, 50% of the  deceased  employee's
retirement  annuity at the time of death reduced by 0.25% for
each month that the widow's age on the date of death is  less
than  55.   However,  in  cases  where  a  refund  of  excess
contributions  for widow's annuity has been paid by the Fund,
the benefit provided by this  subsection  (j)  is  contingent
upon repayment of the refund to the Fund with interest at the
effective  rate  from  the  date  of  refund  to  the date of
payment.
(Source: P.A. 85-964; 86-1488.)

    (40 ILCS 5/8-159) (from Ch. 108 1/2, par. 8-159)
    Sec. 8-159.  Amount of child's annuity.  Beginning on the
effective date of this amendatory  Act  of  1997  January  1,
1988,  the amount of a child's annuity shall be $220 $120 per
month for  each  child  while  the  spouse  of  the  deceased
employee  parent  survives,  and $250 $150 per month for each
child when no such spouse survives, and shall be  subject  to
the following limitations:
    (1)  If the combined annuities for the widow and children
of  an  employee whose death resulted from injury incurred in
the performance of duty, or for the children  where  a  widow
does  not  exist,  exceed 70% of the employee's final monthly
salary, the annuity for each child shall be reduced pro  rata
so  that  the  combined  annuities  for  the family shall not
exceed such limitation.
    (2)  For the family of an employee  whose  death  is  the
result  of  any  cause  other  than  injury  incurred  in the
performance of duty, in which the combined annuities for  the
family exceed 60% of the employee's final monthly salary, the
annuity  for each child shall be reduced pro rata so that the
combined annuities for  the  family  shall  not  exceed  such
limitation.
    (3)  The  increase  in  child's  annuity provided by this
amendatory Act of  1997  1987  shall  apply  to  all  child's
annuities  being  paid on or after the effective date of this
amendatory Act of 1997. January  1,  1988,  subject  to   The
above  limitations  on the combined annuities for a family in
parts (1) and (2) of this Section do not apply to families of
employees  who  died  before  the  effective  date  of   this
amendatory Act of 1997.
    (4)  The  amendments to parts (1) and (2) of this Section
made  by  Public  Act  84-1472   (eliminating   the   further
limitation  that the monthly combined family amount shall not
exceed $500 plus 10% of the employee's final monthly  salary)
shall  apply  in  the  case  of  every qualifying child whose
employee parent dies in the service or enters on  annuity  on
or after January 23, 1987.
(Source: P.A. 85-964.)

    (40 ILCS 5/8-164.1) (from Ch. 108 1/2, par. 8-164.1)
    Sec. 8-164.1.  Group health benefit.
    (a)  For  the  purposes  of this Section: (1) "annuitant"
means a person receiving an age and service annuity, a  prior
service  annuity,  a widow's annuity, a widow's prior service
annuity, or a minimum annuity on or after  January  1,  1988,
under Article 5, 6, 8 or 11, by reason of previous employment
by  the  City  of Chicago (hereinafter, in this Section, "the
city"); (2) "Medicare  Plan  annuitant"  means  an  annuitant
described  in item (1) who is eligible for Medicare benefits;
and (3) "non-Medicare  Plan  annuitant"  means  an  annuitant
described  in  item  (1)  who  is  not  eligible for Medicare
benefits.
    (b)  The  city  shall  continue  to  offer  group  health
benefits to annuitants and their eligible dependents  through
June  30,  2002.   The  same  basic  city  health  care  plan
available  as  of June 30, 1988 (hereinafter called the basic
city plan) shall cease to be a  plan  offered  by  the  city,
except  as  specified in subparagraphs (4) and (5) below, and
shall be closed to new enrollment or transfer of coverage for
any non-Medicare Plan annuitant as of the effective  date  of
this   amendatory   Act   of  1997.   The  city  shall  offer
non-Medicare Plan annuitants and  their  eligible  dependents
the  option  of enrolling in its Annuitant Preferred Provider
Plan, and may offer additional plans for any annuitant.   The
city  may  amend,  modify, or terminate any of its additional
plans at its sole discretion.  If the city offers  more  than
one  annuitant  plan,  the  city  shall  allow  annuitants to
convert coverage from one city  annuitant  plan  to  another,
except  the  basic  city plan, during times designated by the
city, which periods of time shall occur  at  least  annually.
For  the  period  dating  from  the  effective  date  of this
amendatory Act of 1997 through June 30, 2002, monthly premium
rates may be increased for  annuitants  during  the  time  of
their participation in non-Medicare plans, except as provided
in subparagraphs (1) through (4) of this subsection.
         (1)  For  non-Medicare  Plan  annuitants who retired
    prior to  January  1,  1988,  the  annuitant's  share  of
    monthly premium for non-Medicare Plan coverage only shall
    not  exceed the highest premium rate chargeable under any
    city non-Medicare Plan annuitant coverage as of  December
    1, 1996.
         (2)  For  non-Medicare Plan annuitants who retire on
    or after  January  1,  1988,  the  annuitant's  share  of
    monthly premium for non-Medicare Plan coverage only shall
    be  the  rate in effect on December 1, 1996, with monthly
    premium increases to take effect no sooner than April  1,
    1998  at  the  lower  of  (i) the premium rate determined
    pursuant to subsection (g) or (ii) 10% of the immediately
    previous month's rate for similar coverage.
         (3)  In  no  event  shall  any   non-Medicare   Plan
    annuitant's  share  of  monthly  premium for non-Medicare
    Plan coverage  exceed  10%  of  the  annuitant's  monthly
    annuity.
         (4)  Non-Medicare  Plan  annuitants who are enrolled
    in the basic city plan as of July 1, 1998 may  remain  in
    the  basic city plan, if they so choose, on the condition
    that they are not entitled to the caps on rates set forth
    in subparagraphs (1) through (3), and their premium  rate
    shall   be   the   rate  determined  in  accordance  with
    subsections (c) and (g).
         (5)  Medicare  Plan  annuitants  who  are  currently
    enrolled in the basic city  plan  for  Medicare  eligible
    annuitants  may  remain  in that plan, if they so choose,
    through June 30, 2002.  Annuitants shall not  be  allowed
    to  enroll  in  or  transfer into the basic city plan for
    Medicare eligible annuitants on or after  July  1,  1999.
    The   city   shall   continue   to   offer  annuitants  a
    supplemental  Medicare   Plan   for   Medicare   eligible
    annuitants  through June 30, 2002, and the city may offer
    additional plans to Medicare eligible annuitants  in  its
    sole  discretion.   All  Medicare  Plan annuitant monthly
    rates shall be determined in accordance with  subsections
    (c) and (g).
    (c)  Effective  the  date the initial increased annuitant
payments pursuant to subsection (g)  take  effect,  The  city
shall  pay  50%  of  the  aggregated  costs  of the claims or
premiums,  whichever  is   applicable,   as   determined   in
accordance  with  subsection  (g),  of  annuitants  and their
dependents under all health care plans offered by  the  city.
The  city  may  reduce its obligation by application of price
reductions obtained as a  result  of  financial  arrangements
with   providers  or  plan  administrators.   The  claims  or
premiums of all annuitants and their dependents under all  of
the  plans  offered  by  the city shall be aggregated for the
purpose of calculating the city's payment required under this
subsection, as well as for the setting of  rates  of  payment
for annuitants as required under subsection (g).
    (d)  From  January  1,  1988 until December 31, 1992, the
board shall pay to the city on behalf of each of the  board's
annuitants  who  chooses  to participate in any of the city's
plans the following amounts: up to a maximum of $65 per month
for each such annuitant  who  is  not  qualified  to  receive
medicare  benefits,  and up to a maximum of $35 per month for
each such annuitant who  is  qualified  to  receive  medicare
benefits.   From January 1, 1993 until June 30, 2002 December
31, 1997, the board shall pay to the city on behalf  of  each
of  the  board's annuitants who chooses to participate in any
of the city's plans the following amounts: up to a maximum of
$75 per month for each such annuitant who is not qualified to
receive medicare benefits, and up to a  maximum  of  $45  per
month  for  each  such  annuitant who is qualified to receive
medicare benefits.
    For the period January 1, 1988 through the effective date
of this amendatory Act of 1989, payments under  this  Section
shall  be  reduced by the amounts paid by or on behalf of the
board's annuitants covered during that period.
    Commencing on the effective date of this  amendatory  Act
of  1989,  the  board  is  authorized  to pay to the board of
education on behalf of each person who chooses to participate
in the board of education's plan  the  amounts  specified  in
this  subsection  (d)  during  the  years indicated.  For the
period January 1, 1988 through the  effective  date  of  this
amendatory  Act  of 1989, the board shall pay to the board of
education  annuitants  who  participate  in  the   board   of
education's health benefits plan for annuitants the following
amounts: $10 per month to each annuitant who is not qualified
to  receive  medicare  benefits,  and  $14  per month to each
annuitant who is qualified to receive medicare benefits.
    The payments described in this subsection shall  be  paid
from  the  tax  levy  authorized  under  Section  8-189; such
amounts shall be credited to the reserve for  group  hospital
care  and  group  medical and surgical plan benefits, and all
payments to the city required under this subsection shall  be
charged against it.
    (e)  The city's obligations under subsections (b) and (c)
shall  terminate  on  June 30, 2002 December 31, 1997, except
with regard to covered expenses incurred but not paid  as  of
that   date.    This   subsection   shall  not  affect  other
obligations that may be imposed by law.
    (f)  The group coverage plans described in  this  Section
are  not  and  shall  not  be  construed  to  be  pension  or
retirement benefits for purposes of Section 5 of Article XIII
of the Illinois Constitution of 1970.
    (g)  For  each  annuitant  plan  offered by the city, the
aggregate cost of claims, as reflected in the  claim  records
of  the  plan  administrator,  and premiums for each calendar
year from 1989 through 1997 of all annuitants and  dependents
covered  by  the  city's  group  health  care  plans shall be
estimated by the city, based upon a written determination  by
a  qualified  independent actuary to be appointed and paid by
the city and the board.  If the such  estimated  annual  cost
for  each annuitant plan offered by the city is more than the
estimated amount to be contributed by the city for that  plan
pursuant to subsections (b) and (c) during that year plus the
estimated  amounts  to be paid pursuant to subsection (d) and
by the other pension boards on behalf of other  participating
annuitants, the difference shall be paid by all participating
annuitants  participating  in the plan, except as provided in
subsection (b).  The city, based upon  the  determination  of
the  independent actuary, shall set the monthly amounts to be
paid  by   the   participating   annuitants.    The   initial
determination  of such payments shall be prospective only and
shall be based upon the estimated costs for  the  balance  of
the year.  The board may deduct the amounts to be paid by its
annuitants   from   the   participating  annuitants'  monthly
annuities.
    If it is determined from the city's annual audit, or from
audited experience data, that the total amount  paid  by  all
participating annuitants was more or less than the difference
between  (1)  the  cost  of  providing  the group health care
plans, and (2) the sum of the amount to be paid by  the  city
as  determined  under  subsection (c) and the amounts paid by
all the pension boards, then the independent actuary and  the
city  shall  account  for the excess or shortfall in the next
year's  payments  by  annuitants,  except  as   provided   in
subsection (b).
    (h)  An  annuitant  may  elect to terminate coverage in a
plan at the end of any month any time, which  election  shall
terminate  the  annuitant's  obligation  to contribute toward
payment of the excess described in subsection (g).
    (i)  The city shall advise  the  board  of  all  proposed
premium  increases  for health care at least 75 days prior to
the effective date of the change, and any increase  shall  be
prospective only.
(Source: P.A. 86-273.)
    (40 ILCS 5/9-101) (from Ch. 108 1/2, par. 9-101)
    Sec.  9-101.  Creation  of  fund.  In each county of more
than 3,000,000 500,000 inhabitants a  County  Employees'  and
Officers'  Annuity  and  Benefit  Fund  shall be created, set
apart, maintained and administered, in the manner  prescribed
in  this  Article,  for  the  benefit  of  the  employees and
officers herein designated and their beneficiaries.
(Source: Laws 1963, p. 161.)

    (40 ILCS 5/9-120.1 new)
    Sec. 9-120.1.  CTA -  continued  participation;  military
service credit.
    (a)  A person who (i) has at least 20 years of creditable
service   in  the  Fund,  (ii)  has  not  begun  receiving  a
retirement annuity under this Article, and (iii) is  employed
in  a  position under which he or she is eligible to actively
participate  in  the  retirement  system  established   under
Section 22-101 of this Code may elect, after he or she ceases
to  be  a  participant but in no event after June 1, 1998, to
continue his or her participation in this Fund while employed
by the Chicago Transit Authority, for  up  to  10  additional
years, by making written application to the Board.
    (b)  A  person who elects to continue participation under
this Section shall make contributions directly to  the  Fund,
not  less  frequently  than  monthly,  based  on the person's
actual Chicago Transit Authority compensation and  the  rates
applicable  to employees under this Fund.  Creditable service
shall be granted to any person for the period, not  exceeding
10  years, during which the person continues participation in
this  Fund  under  this  Section  and   continues   to   make
contributions   as   required.    For   periods   of  service
established under this Section, the person's  actual  Chicago
Transit Authority compensation shall be considered his or her
salary  for  purposes  of  calculating  benefits  under  this
Article.
    (c)  A  person who elects to continue participation under
this Section may cancel that election at any time.
    (d)  A person who elects to continue participation  under
this  Section  may  establish service credit in this Fund for
periods of employment by the Chicago Transit Authority  prior
to  that  election,  by applying in writing and paying to the
Fund an amount representing employee  contributions  for  the
service  being  established,  based  on  the  person's actual
Chicago Transit Authority compensation  and  the  rates  then
applicable to employees under this Fund, without interest.
    (e)  A  person who qualifies under this Section may elect
to purchase credit for up to 4  years  of  military  service,
whether  or  not  that  service  followed service as a county
employee.  The military service need not have been served  in
wartime,  but  the  employee  must not have been dishonorably
discharged.   To  establish  this  creditable   service   the
applicant must pay to the Fund, on or before July 1, 1998, an
amount  determined  by  the  Fund  to  represent the employee
contributions  for  the  creditable  service,  based  on  the
employee's rate of compensation on his or  her  last  day  of
service  as  a contributor before the military service or his
or her salary on the  first  day  of  service  following  the
military  service, whichever is greater, plus interest at the
effective rate from the date of  discharge  to  the  date  of
payment.   For  the  purposes  of  this subsection, "military
service" includes service in the United States  armed  forces
reserves.
    (f)  Notwithstanding any other provision of this Section,
a  person  may  not  establish  creditable service under this
Section for any period for which the person  receives  credit
under  any other public employee retirement system, including
the retirement system established  under  Section  22-101  of
this Code, unless the credit under that retirement system has
been irrevocably relinquished.

    (40 ILCS 5/9-121.13)
    Sec.  9-121.13.  State's  Attorney  employee  Transfer of
Article 5 credits.
    (a)  An active participant in the Fund who  was  employed
by  the office of the Cook County State's Attorney on January
1, 1995 may transfer to  this  Fund  credits  and  creditable
service  accumulated under the pension fund established under
Article 5 of this Code, as  provided  in  Section  5-237,  by
submitting  a  written  application to the Fund and paying to
the Fund the amount, if any, by which the amount  transferred
to  the  Fund  under Section 5-237 is less than the amount of
employee and employer  contributions  that  would  have  been
received  by  the  Fund  if the service being transferred had
been served as a participant of this Fund, including interest
at the rate of 6% per year,  compounded  annually,  from  the
date of the service to the date of payment.
    (b)  Until  July  1,  1998,  an active participant in the
Fund who is a member of  the  county  police  department  may
transfer   to   this  Fund  credits  and  creditable  service
accumulated under the pension fund established under  Article
5 of this Code, as provided in Section 5-237, by submitting a
written  application  to  the Fund and paying to the Fund the
amount, if any, by which the amount transferred to  the  Fund
under  Section  5-237 is less than the amount of employee and
employer contributions that would have been received  by  the
Fund  if  the  service being transferred had been served as a
participant of this Fund, including interest at the  rate  of
6%  per  year,  compounded  annually,  from  the  date of the
service to the date of payment.
    (c)  The  applicant  may  elect  to  have   the   service
transferred  be  deemed  service  as  a  member of the county
police department; if the applicant so elects,  the  required
payment  shall  be  calculated  on  the  basis  of  the rates
applicable to members of the county police department.
(Source: P.A. 89-136, eff. 7-14-95.)

    (40 ILCS 5/9-133) (from Ch. 108 1/2, par. 9-133)
    Sec. 9-133. Automatic increase in annuity.
    (a)  An employee who  retired  or  retires  from  service
after  December  31, 1959, having attained age 60 or more or,
beginning January 1, 1991, having attained 30 or  more  years
of  creditable service, shall, in the month of January of the
year following the year in which  the  first  anniversary  of
retirement  occurs,  have  his then fixed and payable monthly
annuity increased by 1 1/2%, and such first fixed annuity  as
granted  at  retirement  increased  by  a  further  1 1/2% in
January of each year thereafter.  Beginning with  January  of
the  year  1972, such increases shall be at the rate of 2% in
lieu of  the  aforesaid  specified  1  1/2%.  Beginning  with
January of the year 1982, such increases shall be at the rate
of  3%  in  lieu  of  the  aforesaid specified 2%.  Beginning
January 1, 1998, these increases shall be at the rate  of  3%
of  the current amount of the annuity, including any previous
increases received under  this  Article,  without  regard  to
whether the annuitant is in service on or after the effective
date of this amendatory Act of 1997.
    An  employee  who  retires  on annuity before age 60 and,
beginning January  1,  1991,  with  less  than  30  years  of
creditable  service  shall  receive  such increases beginning
with January of the year immediately following  the  year  in
which  he  attains  the  age  of  60  years.  An employee who
retires on annuity before age 60 and before January 1,  1991,
with  at  least  30  years  of  creditable  service, shall be
entitled to receive the first increase under this  subsection
no later than January 1, 1993.
    For an employee who, in accordance with the provisions of
Section  9-108.1  of  this Act, shall have become a member of
the State System established under Article 14 on February  1,
1974,  the  first  such  automatic  increase  shall  begin in
January of 1975.
    (b)  Subsection (a) is  not  applicable  to  an  employee
retiring  and  receiving  a  term annuity, as defined in this
Act, nor to any  otherwise  qualified  employee  who  retires
before he makes employee contributions (at the 1/2 of 1% rate
as  provided in this Section) for this additional annuity for
not  less  than  the  equivalent  of  one  full  year.   Such
employee, however, shall make arrangement to pay to the  fund
a  balance  of such contributions, based on his final salary,
as will bring such 1/2 of 1% contributions, computed  without
interest, to the equivalent of one year's contributions.
    Beginning  with the month of January, 1960, each employee
shall contribute by means of salary deductions 1/2 of  1%  of
each salary payment, concurrently with and in addition to the
employee   contributions   otherwise   provided  for  annuity
purposes.
    Each such additional contribution shall be credited to an
account in the prior service annuity  reserve,  to  be  used,
together with county contributions, to defray the cost of the
specified  annuity increments. Any balance in such account as
of the beginning of each calendar year shall be credited with
interest at the rate of 3% per annum.
    Such   additional   employee   contributions   are    not
refundable,  except  to an employee who withdraws and applies
for refund under this Article, or applies  for  annuity,  and
also  in  cases where a term annuity becomes payable. In such
cases his contributions shall be refunded, without  interest,
and charged to the prior service annuity reserve.
(Source: P.A. 87-794; 87-1265.)

    (40 ILCS 5/9-133.1) (from Ch. 108 1/2, par. 9-133.1)
    Sec.  9-133.1. Automatic increases in annuity for certain
heretofore retired participants.  A retired employee  retired
at age 55 or over and who (a) is receiving annuity based on a
service  credit of 20 or more years, and (b) does not qualify
for the automatic increases in annuity provided for  in  Sec.
9-133  of this Article, and (c) elects to make a contribution
to the Fund at a time and manner prescribed by the Retirement
Board, of a sum equal to 1%  of  the  final  average  monthly
salary  forming the basis of the calculation of their annuity
multiplied by years of credited service, or 1% of their final
monthly salary multiplied by years of credited service in any
case where the final  average  salary  is  not  used  in  the
calculation,  shall  have  his  original  fixed  and  payable
monthly  amount  of  annuity increased in January of the year
following the year in which he attains the age of  65  years,
if  such  age  of  65  years  is attained in the year 1969 or
later, by an  amount  equal  to  1  1/2%,  and  by  an  equal
additional  1  1/2%  in  January  of  each  year  thereafter.
Beginning with January of the year 1972, such increases shall
be  at  the  rate  of 2% in lieu of the aforesaid specified 1
1/2%.   Beginning  with  January  of  the  year  1982,   such
increases shall be at the rate of 3% in lieu of the aforesaid
specified  2%.   Beginning  January  1, 1998, these increases
shall be at the rate of 3%  of  the  current  amount  of  the
annuity, including any previous increases received under this
Article,  without  regard  to  whether  the  annuitant  is in
service on or after the effective date of this amendatory Act
of 1997.
    In those cases in which the  retired  employee  receiving
annuity  has attained the age of 66 or more years in the year
1969, he shall have such annuity increased in January of  the
year  1970  by  an  amount  equal to 1 1/2% multiplied by the
number equal to the number of months of January elapsing from
and including January of the year immediately  following  the
year  he  attained the age of 65 years if retired at or prior
to age  65,  or  from  and  including  January  of  the  year
immediately following the year of retirement if retired at an
age  greater  than  65 years, to and including January of the
year 1970, and by an equal additional 1 1/2%  in  January  of
each  year  thereafter.  Beginning  with  January of the year
1972, such increases shall be at the rate of 2%  in  lieu  of
the  aforesaid  specified  1 1/2%.  Beginning with January of
the year 1982, such increases shall be at the rate of  3%  in
lieu  of  the  aforesaid  specified 2%.  Beginning January 1,
1998, these increases shall be at  the  rate  of  3%  of  the
current   amount  of  the  annuity,  including  any  previous
increases received under  this  Article,  without  regard  to
whether the annuitant is in service on or after the effective
date of this amendatory Act of 1997.
    To  defray  the annual cost of such increases, the annual
interest income of the Fund, accruing from  investments  held
by  the  Fund,  exclusive  of  gains  or  losses  on sales or
exchanges of assets during the year,  over  and  above  4%  a
year,  shall be used to the extent necessary and available to
finance the cost of such increases for  the  following  year,
and  such  amount  shall be transferred as of the end of each
year, beginning  with  the  year  1969,  to  a  Fund  account
designated  as  the  Supplementary  Payment  Reserve from the
Investment and Interest Reserve set forth in Sec. 9-214.  The
sums  contributed  by  annuitants  as  provided  for  in this
Section shall also be placed in the  aforesaid  Supplementary
Payment  Reserve  and  shall  be applied for and used for the
purposes of such Fund account, together  with  the  aforesaid
interest.
    In  the  event  the  monies  in the Supplementary Payment
Reserve in any year arising from: (1) the available  interest
income  as defined hereinbefore and accruing in the preceding
year above 4% a year and (2)  the  contributions  by  retired
persons,  as set forth hereinbefore, are insufficient to make
the total payments to all persons estimated to be entitled to
the annuity increases specified hereinbefore,  then  (3)  any
interest earnings over 4% a year beginning with the year 1969
which  were not previously used to finance such increases and
which were transferred to the Prior Service  Annuity  Reserve
may  be used to the extent necessary and available to provide
sufficient funds to finance such increases  for  the  current
year,  and  such  sums  shall  be  transferred from the Prior
Service Annuity Reserve.
    In  the  event  the  total  monies   available   in   the
Supplementary  Payment  Reserve  from the preceding indicated
sources are insufficient to make the total  payments  to  all
persons   entitled   to   such  increases  for  the  year,  a
proportionate amount computed as  the  ratio  of  the  monies
available  to  the  total of the total payments for that year
shall be paid to each person for that year.
    The Fund shall  be  obligated  for  the  payment  of  the
increases  in annuity as provided for in this Section only to
the extent that the assets for  such  purpose,  as  specified
herein, are available.
(Source: P.A. 83-1362.)

    (40 ILCS 5/9-134.3 new)
    Sec. 9-134.3.  Early retirement incentives.
    (a)  To  be  eligible  for  the benefits provided in this
Section, a person must:
         (1)  be a current contributing member  of  the  Fund
    established  under  this  Article who, on May 1, 1997 and
    within 30 days prior to the date of retirement, is (i) in
    active payroll status in a position of  employment  under
    this  Article or (ii) receiving disability benefits under
    Section 9-156 or 9-157;
         (2)  have not previously retired from the Fund;
         (3)  file with the Board before October 1,  1997,  a
    written  application  requesting the benefits provided in
    this Section;
         (4)  elect to retire under this Section on or  after
    September  1, 1997 and on or before February 28, 1998 (or
    the   date   established   under   subsection   (d),   if
    applicable);
         (5)  have attained age 55 on or before the  date  of
    retirement and before February 28, 1998; and
         (6)  have at least 10 years of creditable service in
    the   Fund,   excluding  service  in  any  of  the  other
    participating  systems  under  the   Retirement   Systems
    Reciprocal  Act,  by the effective date of the retirement
    annuity or February 28, 1998, whichever occurs first.
    (b)  An employee who qualifies for the benefits  provided
under this Section shall be entitled to the following:
         (1)  The    employee's    retirement   annuity,   as
    calculated under the other provisions  of  this  Article,
    shall be increased at the time of retirement by an amount
    equal  to  1% of the employee's average annual salary for
    the highest 4 consecutive years within the last 10  years
    of  service, multiplied by the employee's number of years
    of service credit in this Fund up  to  a  maximum  of  10
    years;   except   that   the  total  retirement  annuity,
    including any additional benefits elected  under  Section
    9-121.6  or 9-179.3, shall not exceed 80% of that highest
    average annual salary.
         (2)  If  the  employee's   retirement   annuity   is
    calculated under Section 9-134, the employee shall not be
    subject to the reduction in retirement annuity because of
    retirement  below age 60 that is otherwise required under
    that Section.
    (c)  A person who elects to retire under  the  provisions
of  this  Section  thereby  relinquishes his or her right, if
any, to have the  retirement  annuity  calculated  under  the
alternative  formula  formerly set forth in Section 20-122 of
the Retirement Systems Reciprocal Act.
    (d)  In  the  case  of  an   employee   whose   immediate
retirement  could jeopardize public safety or create hardship
for the employer, the deadline  for  retirement  provided  in
subdivision  (a)(4)  of  this  Section  may  be extended to a
specified date,  no  later  than  August  31,  1998,  by  the
employee's   department   head,  with  the  approval  of  the
President of the County Board.  In the case  of  an  employee
who  is  not  employed  by  a  department  of the County, the
employee's  "department  head",  for  the  purposes  of  this
Section, shall be a person designated by the President of the
County Board.
    (e)  Notwithstanding  Section  9-161,  an  annuitant  who
reenters  service  under  this  Article  after  receiving   a
retirement  annuity  based  on  benefits  provided under this
Section thereby forfeits the right  to  continue  to  receive
those  benefits  and shall have his or her retirement annuity
recalculated without the benefits provided in this Section.
    (f)  This Section also applies to  the  Fund  established
under Article 10 of this Code.

    (40 ILCS 5/9-146.2 new)
    Sec.   9-146.2.  Automatic  annual  increase  in  widow's
annuity.
    (a)  Every widow's annuity, other than  a  term  annuity,
shall  be  increased  on  January  1,  1998  or the January 1
occurring on or immediately after the  first  anniversary  of
the  deceased employee's death, whichever occurs later, by an
amount equal to 3% of the amount of the annuity.
    On each January 1 after the date of the initial  increase
under this Section, the widow's annuity shall be increased by
an  amount  equal  to 3% of the amount of the widow's annuity
payable at the time of the increase, including any  increases
previously granted under this Article.
    (b)  Limitations on the maximum amount of widow's annuity
imposed  under  Section  9-150  do  not  apply  to the annual
increases provided under this Section.
    (c)  The increases provided under this Section also apply
to compensation annuities and supplemental annuities  payable
under  Section  9-147.   The  increases  provided  under this
Section do not apply to term annuities.

    (40 ILCS 5/9-179.3) (from Ch. 108 1/2, par. 9-179.3)
    Sec. 9-179.3.  Optional plan of additional  benefits  and
contributions.
    (a)  While  this  plan  is  in  effect,  an  employee may
establish additional optional credit for additional  optional
benefits   by  electing  in  writing  at  any  time  to  make
additional  optional   contributions.    The   employee   may
discontinue  making  the additional optional contributions at
any time by notifying the fund in writing.
    (b)  Additional optional contributions for the additional
optional benefits shall be as follows:
         (1)  For service after the  option  is  elected,  an
    additional   contribution   of  3%  of  salary  shall  be
    contributed to the fund on the same basis and  under  the
    same  conditions as contributions required under Sections
    9-170 and 9-176.
         (2)  For service before the option  is  elected,  an
    additional  contribution  of  3%  of  the  salary for the
    applicable  period  of  service,  plus  interest  at  the
    effective rate from the date of service to  the  date  of
    payment.   All  payments for past service must be paid in
    full before  credit  is  given.  No  additional  optional
    contributions  may  be made for any period of service for
    which credit has been previously forfeited by  acceptance
    of  a  refund,  unless  the refund is repaid in full with
    interest at the effective rate from the date of refund to
    the date of repayment.
    (c)  Additional optional benefits shall  accrue  for  all
periods    of   eligible   service   for   which   additional
contributions are paid in full.  The additional benefit shall
consist of an additional 1% for  each  year  of  service  for
which  optional  contributions  have  been paid, based on the
highest average annual salary for  any  4  consecutive  years
within the last 10 years of service immediately preceding the
date  of  withdrawal,  to be added to the employee retirement
annuity benefits as otherwise computed  under  this  Article.
The calculation of these additional benefits shall be subject
to  the  same  terms  and  conditions  as  are  used  in  the
calculation  of  retirement annuity under Section 9-134.  The
additional benefit shall be included in  the  calculation  of
the   automatic  annual  increase  in  annuity,  and  in  the
calculation of widow's annuity, where applicable.  However no
additional benefits will be granted  which  produce  a  total
annuity  greater  than the applicable maximum established for
that type of annuity in this Article, and additional benefits
shall  not  apply  to  any  benefit  computed  under  Section
9-128.1.
    (d)  Refunds of additional optional  contributions  shall
be  made  on  the same basis and under the same conditions as
provided under Sections 9-164,  9-166  and  9-167.   Interest
shall be credited at the effective rate on the same basis and
under the same conditions as for other contributions.
    (e)  Optional  contributions  shall be accounted for in a
separate Optional Contribution Reserve.
    (f)  The tax levy, computed under Section 9-169, shall be
based on  employee  contributions  including  the  amount  of
optional additional employee contributions.
    (g)  Service eligible under this Section may include only
service  as  an  employee of the County as defined in Section
9-108, and subject to Sections 9-219 and 9-220.   No  service
granted  under  Section  9-121.1, 9-121.4 or 9-179.2 shall be
eligible for optional service credit.   No  optional  service
credit  may  be  established for any military service, or for
any service under any other Article of this  Code.   Optional
service   credit   may  be  established  for  any  period  of
disability  paid  from  this  fund,  if  the  employee  makes
additional  optional  contributions  for  such   periods   of
disability.
    (h)  This  plan  of  optional  benefits and contributions
shall not apply to any former county  employee  receiving  an
annuity  from  the  fund,  who  re-enters service as a County
employee, unless he renders at least 3  years  of  additional
service after the date of re-entry.
    (i)  The   effective   date   of  the  optional  plan  of
additional benefits and contributions shall be July 1,  1985,
or the date upon which approval is received from the Internal
Revenue Service, whichever is later.
    (j)  This  plan  of additional benefits and contributions
shall expire July 1, 2002 1997.  No additional  contributions
may  be made after that date, and no additional benefits will
accrue after that date.
(Source: P.A. 86-1027; 87-794.)

    (40 ILCS 5/11-134) (from Ch. 108 1/2, par. 11-134)
    Sec. 11-134.  Minimum annuities.
    (a)  An employee whose withdrawal occurs  after  July  1,
1957 at age 60 or over, with 20 or more years of service, (as
service  is  defined or computed in Section 11-216), for whom
the age and service and prior  service  annuity  combined  is
less  than the amount stated in this section, shall, from and
after the date  of  withdrawal,  in  lieu  of  all  annuities
otherwise provided in this Article, be entitled to receive an
annuity  for  life of an amount equal to 1 2/3% for each year
of service, of the highest average annual salary  for  any  5
consecutive  years  within  the  last  10  years  of  service
immediately  preceding the date of withdrawal; provided, that
in the case of any employee who withdraws on or after July 1,
1971, such employee age 60 or over with 20 or more  years  of
service,  shall be entitled to instead receive an annuity for
life equal to 1.67%  for  each  of  the  first  10  years  of
service;  1.90%  for  each  of  the next 10 years of service;
2.10% for each year of  service  in  excess  of  20  but  not
exceeding 30; and 2.30% for each year of service in excess of
30,  based  on  the  highest  average annual salary for any 4
consecutive  years  within  the  last  10  years  of  service
immediately preceding the date of withdrawal.
    An employee who withdraws after July 1, 1957  and  before
January 1, 1988, with 20 or more years of service, before age
60,  shall  be  entitled  to an annuity, to begin not earlier
than age 55, if under such age at withdrawal, as computed  in
the  last  preceding paragraph, reduced 0.25% if the employee
was born before January 1, 1936, or 0.5% if the employee  was
born  on  or  after  January  1, 1936, for each full month or
fractional part thereof  that  his  attained  age  when  such
annuity is to begin is less than 60.
    Any  employee  born  before January 1, 1936 who withdraws
with 20 or more years of service, and any employee with 20 or
more years of service who withdraws on or  after  January  1,
1988,  may  elect  to  receive, in lieu of any other employee
annuity provided in this Section, an annuity for  life  equal
to 1.80% for each of the first 10 years of service, 2.00% for
each  of the next 10 years of service, 2.20% for each year of
service in excess of 20, but not exceeding 30, and 2.40%  for
each  year of service in excess of 30, of the highest average
annual salary for any 4 consecutive years within the last  10
years   of   service   immediately   preceding  the  date  of
withdrawal, to begin not earlier than upon attained age of 55
years, if under such age at  withdrawal,  reduced  0.25%  for
each  full month or fractional part thereof that his attained
age when annuity is to begin is less than 60; except that  an
employee  retiring  on or after January 1, 1988, at age 55 or
over but less than age  60,  having  at  least  35  years  of
service, or an employee retiring on or after July 1, 1990, at
age 55 or over but less than age 60, having at least 30 years
of service, or an employee retiring on or after the effective
date  of  this  amendatory Act of 1997, at age 55 or over but
less than age 60, having at least 25 years of service,  shall
not be subject to the reduction in retirement annuity because
of retirement below age 60.
    However,  in  the  case  of an employee who retired on or
after January 1, 1985 but before January 1, 1988, at  age  55
or  older  and with at least 35 years of service, and who was
subject  under  this  subsection  (a)  to  the  reduction  in
retirement annuity because of retirement below age  60,  that
reduction  shall  cease  to be effective January 1, 1991, and
the retirement annuity shall be recalculated accordingly.
    Any employee who withdraws on or after July 1, 1990, with
20 or more years of service, may elect to receive, in lieu of
any other employee  annuity  provided  in  this  Section,  an
annuity  for  life equal to 2.20% for each year of service of
the highest average annual salary for any 4 consecutive years
within the last 10 years of service immediately preceding the
date of withdrawal, to begin not earlier than  upon  attained
age  of  55  years,  if under such age at withdrawal, reduced
0.25% for each full month or fractional part thereof that his
attained age when annuity is to begin is less than 60; except
that an employee retiring at age 55 or over but less than age
60, having at least 30 years of service, shall not be subject
to the reduction in retirement annuity because of  retirement
below age 60.
    Any employee who withdraws on or after the effective date
of  this  amendatory  Act  of  1997  with 20 or more years of
service may elect to receive, in lieu of any  other  employee
annuity  provided  in this Section, an annuity for life equal
to 2.20%, for each year of service, of  the  highest  average
annual  salary for any 4 consecutive years within the last 10
years  of  service  immediately   preceding   the   date   of
withdrawal,  to begin not earlier than upon attainment of age
55 (age 50 if the employee has at least 30 years of service),
reduced 0.25% for each full  month  or  remaining  fractional
part thereof that the employee's attained age when annuity is
to begin is less than 60; except that an employee retiring at
age 50 or over with at least 30 years of service or at age 55
or  over  with  at  least  25  years  of service shall not be
subject to the reduction in  retirement  annuity  because  of
retirement below age 60.
    The  maximum  annuity payable under this paragraph (a) of
this Section shall not exceed 70% of highest  average  annual
salary in the case of an employee who withdraws prior to July
1,  1971,  and 75% if withdrawal takes place on or after July
1, 1971. For the purpose of the minimum annuity  provided  in
said paragraphs $1,500 shall be considered the minimum annual
salary  for  any  year;  and  the maximum annual salary to be
considered for the  computation  of  such  annuity  shall  be
$4,800  for any year prior to 1953, $6,000 for the years 1953
to 1956, inclusive, and the actual annual salary,  as  salary
is defined in this Article, for any year thereafter.
    (b)  For  an  employee  receiving disability benefit, his
salary for annuity purposes under this section shall, for all
periods of disability benefit subsequent to the year 1956, be
the amount on which his disability benefit was based.
    (c)  An employee with 20 or more years of service,  whose
entire  disability  benefit  credit  period  expires prior to
attainment of age 55 while still disabled for service,  shall
be  entitled upon withdrawal to the larger of (1) the minimum
annuity provided above assuming that he is then age  55,  and
reducing  such  annuity  to  its  actuarial equivalent at his
attained age on such date, or (2) the annuity  provided  from
his age and service and prior service annuity credits.
    (d)  The  minimum  annuity  provisions as aforesaid shall
not apply to any former employee receiving  an  annuity  from
the fund, and who re-enters service as an employee, unless he
renders at least 3 years of additional service after the date
of re-entry.
    (e)  An  employee  in  service  on  July  1, 1947, or who
became a contributor after July 1, 1947 and prior to July  1,
1950,  or  who  shall  become a contributor to the fund after
July 1, 1950 prior to attainment of  age  70,  who  withdraws
after age 65 with less than 20 years of service, for whom the
annuity  has  been fixed under the foregoing sections of this
Article shall, in lieu of the annuity so  fixed,  receive  an
annuity as follows:
    Such amount as he could have received had the accumulated
amounts  for  annuity  been  improved  with  interest  at the
effective  rate  to  the  date  of  his  withdrawal,  or   to
attainment  of age 70, whichever is earlier, and had the city
contributed to such earlier date for age and service  annuity
the amount that would have been contributed had he been under
age  65,  after  the date his annuity was fixed in accordance
with this Article, and assuming  his  annuity  were  computed
from  such  accumulations as of his age on such earlier date.
The annuity so computed shall not exceed  the  annuity  which
would  be  payable under the other provisions of this section
if the employee was credited with 20  years  of  service  and
would qualify for annuity thereunder.
    (f)  In  lieu  of  the annuity provided in this or in any
other section of this Article, an  employee  having  attained
age  65  with at least 15 years of service who withdraws from
service on or after July 1, 1971 and whose  annuity  computed
under  other  provisions  of  this  Article  is less than the
amount provided under this paragraph  shall  be  entitled  to
receive  a minimum annual annuity for life equal to 1% of the
highest average annual salary for  any  4  consecutive  years
within  the  last  10  years of service immediately preceding
retirement for each year of his service plus the sum  of  $25
for  each  year  of  service.  Such  annual annuity shall not
exceed the maximum percentages stated under paragraph (a)  of
this Section of such highest average annual salary.
    (g)  Any  annuity payable under the preceding subsections
of this  Section  11-134  shall  be  paid  in  equal  monthly
installments.
    (h)  The  amendatory  provisions  of  part (a) and (f) of
this Section shall be effective July 1, 1971 and apply in the
case of every qualifying employee  withdrawing  on  or  after
July 1, 1971.
    (i)  The  amendatory provisions of this amendatory Act of
1985  relating  to  the  discount  of  annuity   because   of
retirement  prior  to attainment of age 60 and increasing the
retirement formula for those born  before  January  1,  1936,
shall  apply  only  to qualifying employees withdrawing on or
after August 16, 1985.
    (j)  Beginning on the effective date of  this  amendatory
Act of 1997 January 1, 1991, the minimum amount of employee's
annuity  shall  be  $550  $350  per  month  for  life for the
following classes of employees, without regard  to  the  fact
that  withdrawal occurred prior to the effective date of this
amendatory Act of 1997 January 1, 1991:
         (1)  any employee annuitant alive  and  receiving  a
    life annuity on the effective date of this amendatory Act
    of 1997 January 1, 1991, except a reciprocal annuity;
         (2)  any  employee  annuitant  alive and receiving a
    term annuity on the effective date of this amendatory Act
    of 1997 January 1, 1991, except a reciprocal annuity;
         (3)  any employee annuitant alive  and  receiving  a
    reciprocal   annuity   on  the  effective  date  of  this
    amendatory Act of 1997 January 1, 1991, whose service  in
    this fund is at least 5 years;
         (4)  any employee annuitant withdrawing after age 60
    on  or after the effective date of this amendatory Act of
    1997 January 1, 1991, with at least 10 years  of  service
    in this fund.
    The  increases  granted  under  items (1), (2) and (3) of
this subsection (j) shall not be limited by any other Section
of this Act.
(Source: P.A. 85-964; 86-1488.)

    (40 ILCS 5/11-145.1) (from Ch. 108 1/2, par. 11-145.1)
    Sec. 11-145.1.  Minimum annuities for widows.  The  widow
otherwise  eligible  for widow's annuity under other Sections
of this Article 11, of an employee hereinafter described, who
retires from service or dies while in the service  subsequent
to  the  effective date of this amendatory provision, and for
which widow the amount of widow's annuity and  widow's  prior
service  annuity  combined,  fixed or provided for such widow
under other provisions of said Article 11 is  less  than  the
amount  hereinafter provided in this section, shall, from and
after the date her otherwise provided annuity would begin, in
lieu of such otherwise provided  widow's  and  widow's  prior
service  annuity,  be  entitled  to  the  following indicated
amount of annuity:
    (a)  The widow of any employee who dies while in  service
on  or after the date on which he attains age 60 if the death
occurs before July 1, 1990, or on or after the date on  which
he  attains  age  55  if the death occurs on or after July 1,
1990, with at least 20 years of service, or on or  after  the
date  on  which  he  attains age 50 if the death occurs on or
after the effective date of this amendatory Act of 1997  with
at least 30 years of service, shall be entitled to an annuity
equal to one-half of the amount of annuity which her deceased
husband  would have been entitled to receive had he withdrawn
from the service on the day immediately preceding the date of
his death, conditional upon such widow having attained age 60
on or before such date if the death  occurs  before  July  1,
1990, or age 55 if the death occurs on or after July 1, 1990.
The  widow's  annuity  shall  not, however, exceed the sum of
$500 a month if the employee's death in service occurs before
January 23, 1987.  The widow's annuity shall not  be  limited
to a maximum dollar amount if the employee's death in service
occurs on or after January 23, 1987.
    If  the employee dies in service before July 1, 1990, and
if such widow of such described employee shall not be  60  or
more  years of age on such date of death, the amount provided
in the immediately preceding paragraph for a widow 60 or more
years of age, shall, in the case of such  younger  widow,  be
reduced by 0.25% for each month that her then attained age is
less than 60 years if the employee was born before January 1,
1936, or dies in service on or after January 1, 1988, or 0.5%
for  each  month  that  her then attained age is less than 60
years if the employee was born on or after  January  1,  1936
and dies in service before January 1, 1988.
    If the employee dies in service on or after July 1, 1990,
and  if  the widow of the employee has not attained age 55 on
or before the employee's date of death, the amount  otherwise
provided in this subsection (a) shall be reduced by 0.25% for
each month that her then attained age is less than 55 years.
    (b)  The widow of any employee who dies subsequent to the
date  of  his retirement on annuity, and who so retired on or
after the date on which he  attained  age  60  if  retirement
occurs  before July 1, 1990, or on or after the date on which
he attained age 55 if retirement occurs on or after  July  1,
1990,  with  at least 20 years of service, or on or after the
date on which he attained age 50 if the retirement occurs  on
or  after  the  effective date of this amendatory Act of 1997
with at least 30 years of service, shall be  entitled  to  an
annuity  equal to one-half of the amount of annuity which her
deceased husband received as of the date of his retirement on
annuity, conditional upon such widow having attained  age  60
on  or before the date of her husband's retirement on annuity
if retirement occurs before  July  1,  1990,  or  age  55  if
retirement  occurs  on  or after July 1, 1990. Such amount of
widow's annuity shall not, however, exceed the sum of $500  a
month if the employee's death occurs before January 23, 1987.
The  widow's annuity shall not be limited to a maximum dollar
amount if the employee's death occurs on or after January 23,
1987, regardless of the date of retirement; provided that, if
retirement was before  January  23,  1987,  the  employee  or
eligible spouse repays the excess spouse refund with interest
at  the effective rate from the date of refund to the date of
repayment.
    If the date of the employee's retirement  on  annuity  is
before  July  1,  1990,  and  if such widow of such described
employee shall not have attained such age of 60 or more years
on such date of her  husband's  retirement  on  annuity,  the
amount  provided in the immediately preceding paragraph for a
widow 60 or more years of age on the date  of  her  husband's
retirement  on  annuity,  shall,  in  the  case  of such then
younger widow, be reduced by 0.25% for each  month  that  her
then  attained age was less than 60 years if the employee was
born before January 1, 1936, or withdraws from service on  or
after  January  1, 1988, or 0.5% for each month that her then
attained age was less than 60 years if the employee was  born
on or after January 1, 1936 and withdraws from service before
January 1, 1988.
    If the date of the employee's retirement on annuity is on
or  after  July 1, 1990, and if the widow of the employee has
not attained age 55 by the date of the employee's  retirement
on  annuity, the amount otherwise provided in this subsection
(b) shall be reduced by 0.25% for each month  that  her  then
attained age is less than 55 years.
    (c)  The   foregoing   provisions   relating  to  minimum
annuities for widows shall not apply  to  the  widow  of  any
former  employee receiving an annuity from the fund on August
2,  1965  or  on  the  effective  date  of  this   amendatory
provision, who re-enters service as a former employee, unless
such  employee renders at least 3 years of additional service
after the date of re-entry.
    (d)  The amendatory provisions of part  (a)  and  (b)  of
this  Section  (increasing  the  maximum  from $300 to $400 a
month) shall be effective as of July 1, 1971,  and  apply  in
the  case  of every qualifying widow whose husband dies while
in service on or after July 1, 1971 and prior to  January  1,
1984,  or withdraws and enters on annuity on or after July 1,
1971 and prior to January 1, 1984.
    (e)  The changes made  in  parts  (a)  and  (b)  of  this
Section  by  this  amendatory  Act  of  1983  (increasing the
maximum from $400 to $500 per month)  shall  apply  to  every
qualifying  widow  whose  husband  dies  in the service on or
after January 1, 1984, or withdraws and enters on annuity  on
or after January 1, 1984.
    (f)  The  amendments  to  this Section by this amendatory
Act of 1985, relating to changing the discount because of age
from 1/2 of 1% to 0.25% per month  for  widows  of  employees
born  before  January 1, 1936, shall apply only to qualifying
widows whose husbands die while in the service  on  or  after
August  16, 1985 or withdraw and enter on annuity on or after
August 16, 1985.
    (g)  Beginning on the effective date of  this  amendatory
Act  of  1997  January 1, 1991, the minimum amount of widow's
annuity shall be  $500  $300  per  month  for  life  for  the
following  classes of widows, without regard to the fact that
the death of the employee occurred  prior  to  the  effective
date of this amendatory Act of 1997 January 1, 1991:
         (1)  any  widow annuitant alive and receiving a term
    annuity on the effective date of this amendatory  Act  of
    1997 January 1, 1991, except a reciprocal annuity;
         (2)  any  widow annuitant alive and receiving a life
    annuity on the effective date of this amendatory  Act  of
    1997 January 1, 1991, except a reciprocal annuity;
         (3)  any  widow  annuitant  alive  and  receiving  a
    reciprocal   annuity   on  the  effective  date  of  this
    amendatory Act of 1997 January 1,  1991,  whose  employee
    spouse's service in this fund was at least 5 years;
         (4)  the widow of an employee with at least 10 years
    of service in this fund who dies after retirement, if the
    retirement  occurred  prior to the effective date of this
    amendatory Act of 1997 January 1, 1991;
         (5)  the widow of an employee with at least 10 years
    of service in this fund who  dies  after  retirement,  if
    withdrawal  occurs on or after the effective date of this
    amendatory Act of 1997 January 1, 1991;
         (6)  the widow of an employee who  dies  in  service
    with  at  least  5  years of service in this fund, if the
    death in service occurs on or after the effective date of
    this amendatory Act of 1997 January 1, 1991.
    The increases granted under items (1), (2), (3)  and  (4)
of  this  subsection  (g)  shall  not be limited by any other
Section of this Act.
    (h)  The widow of an employee  who  retired  or  died  in
service  on or after January 1, 1985 and before July 1, 1990,
at age 55 or older, and with at least  35  years  of  service
credit,  shall  be  entitled  to  have  her  widow's  annuity
increased,  effective  January 1, 1991, to an amount equal to
50% of the retirement  annuity  that  the  deceased  employee
received  on  the  date  of  retirement,  or  would have been
eligible to receive if he had retired on  the  day  preceding
the  date of his death in service, provided that if the widow
had not attained  age  60  by  the  date  of  the  employee's
retirement  or  death  in  service, the amount of the annuity
shall be reduced by  0.25%  for  each  month  that  her  then
attained   age  was  less  than  age  60  if  the  employee's
retirement or death in service occurred on or  after  January
1,  1988, or by 0.5%  for each month that her attained age is
less than age 60 if the employee's  retirement  or  death  in
service occurred prior to January 1, 1988.  However, in cases
where  a  refund  of excess contributions for widow's annuity
has been paid by the Fund, the increase in  benefit  provided
by this subsection (h) (i) shall be contingent upon repayment
of the refund to the Fund with interest at the effective rate
from the date of refund to the date of payment.
    (i)  If  a  deceased  employee  is receiving a retirement
annuity at the time of death and  that  death  occurs  on  or
after  the effective date of this amendatory Act of 1997, the
widow may elect to receive, in  lieu  of  any  other  annuity
provided  under  this Article, 50% of the deceased employee's
retirement annuity at the time of death reduced by 0.25%  for
each  month that the widow's age on the date of death is less
than  55.   However,  in  cases  where  a  refund  of  excess
contributions for widow's annuity has been paid by the  Fund,
the  benefit  provided  by  this subsection (i) is contingent
upon repayment of the refund to the Fund with interest at the
effective rate from  the  date  of  refund  to  the  date  of
payment.
(Source: P.A. 85-964; 86-1488.)

    (40 ILCS 5/11-154) (from Ch. 108 1/2, par. 11-154)
    Sec.  11-154.   Amount  of child's annuity.  Beginning on
the effective date of this amendatory Act of 1997 January  1,
1988,  the amount of a child's annuity shall be $220 $120 per
month for  each  child  while  the  spouse  of  the  deceased
employee  parent  survives,  and $250 $150 per month for each
child when no such spouse survives, and shall be  subject  to
the following limitations:
    (1)  If the combined annuities for the widow and children
of an employee whose death resulted from injury  incurred  in
the  performance  of  duty, or for the children where a widow
does not exist, exceed 70% of the  employee's  final  monthly
salary,  the annuity for each child shall be reduced pro rata
so that the combined  annuities  for  the  family  shall  not
exceed such limitation;
    (2)  For  the  family  of  an employee whose death is the
result of  any  cause  other  than  injury  incurred  in  the
performance  of duty, in which the combined annuities for the
family exceed 60% of the employee's final monthly salary, the
annuity for each child shall be reduced pro rata so that  the
combined  annuities  for  the  family  shall  not exceed such
limitation.
    A child's annuity shall be paid  to  the  parent  who  is
providing  for  the  child,  unless  another  person has been
appointed the child's legal guardian.
    The  increase  in  child's  annuity  provided   by   this
amendatory  Act  of  1997  1987  shall  apply  to all child's
annuities being paid on or after the effective date  of  this
amendatory Act of 1997. January 1, 1988, subject to The above
limitations  on  the combined annuities for a family in parts
(1) and (2) of this Section  do  not  apply  to  families  of
employees   who  died  before  the  effective  date  of  this
amendatory Act of 1997.
(Source: P.A. 85-964.)

    (40 ILCS 5/11-160.1) (from Ch. 108 1/2, par. 11-160.1)
    Sec. 11-160.1.  Group health benefit.
    (a)  For the purposes of this  Section:  (1)  "annuitant"
means  a person receiving an age and service annuity, a prior
service annuity, a widow's annuity, a widow's  prior  service
annuity,  or  a  minimum annuity on or after January 1, 1988,
under Article 5, 6, 8 or 11, by reason of previous employment
by the City of Chicago (hereinafter, in  this  Section,  "the
city");  (2)  "Medicare  Plan  annuitant"  means an annuitant
described in item (1) who is eligible for Medicare  benefits;
and  (3)  "non-Medicare  Plan  annuitant"  means an annuitant
described in item  (1)  who  is  not  eligible  for  Medicare
benefits.
    (b)  The  city  shall  continue  to  offer  group  health
benefits  to annuitants and their eligible dependents through
June  30,  2002.   The  same  basic  city  health  care  plan
available as of June 30, 1988 (hereinafter called  the  basic
city  plan)  shall  cease  to  be a plan offered by the city,
except as specified in subparagraphs (4) and (5)  below,  and
shall be closed to new enrollment or transfer of coverage for
any  non-Medicare  Plan annuitant as of the effective date of
this  amendatory  Act  of  1997.   The   city   shall   offer
non-Medicare  Plan  annuitants  and their eligible dependents
the option of enrolling in its Annuitant  Preferred  Provider
Plan,  and may offer additional plans for any annuitant.  The
city may amend, modify, or terminate any  of  its  additional
plans  at  its sole discretion.  If the city offers more than
one annuitant  plan,  the  city  shall  allow  annuitants  to
convert  coverage  from  one  city annuitant plan to another,
except the basic city plan, during times  designated  by  the
city,  which  periods  of time shall occur at least annually.
For the  period  dating  from  the  effective  date  of  this
amendatory Act of 1997 through June 30, 2002, monthly premium
rates  may  be  increased  for  annuitants during the time of
their participation in non-Medicare plans, except as provided
in subparagraphs (1) through (4) of this subsection.
         (1)  For non-Medicare Plan  annuitants  who  retired
    prior  to  January  1,  1988,  the  annuitant's  share of
    monthly premium for non-Medicare Plan coverage only shall
    not exceed the highest premium rate chargeable under  any
    city  non-Medicare Plan annuitant coverage as of December
    1, 1996.
         (2)  For non-Medicare Plan annuitants who retire  on
    or  after  January  1,  1988,  the  annuitant's  share of
    monthly premium for non-Medicare Plan coverage only shall
    be the rate in effect on December 1, 1996,  with  monthly
    premium  increases to take effect no sooner than April 1,
    1998 at the lower of  (i)  the  premium  rate  determined
    pursuant to subsection (g) or (ii) 10% of the immediately
    previous month's rate for similar coverage.
         (3)  In   no   event  shall  any  non-Medicare  Plan
    annuitant's share of  monthly  premium  for  non-Medicare
    Plan  coverage  exceed  10%  of  the  annuitant's monthly
    annuity.
         (4)  Non-Medicare Plan annuitants who  are  enrolled
    in  the  basic city plan as of July 1, 1998 may remain in
    the basic city plan, if they so choose, on the  condition
    that they are not entitled to the caps on rates set forth
    in  subparagraphs (1) through (3), and their premium rate
    shall  be  the  rate  determined   in   accordance   with
    subsections (c) and (g).
         (5)  Medicare  Plan  annuitants  who  are  currently
    enrolled  in  the  basic  city plan for Medicare eligible
    annuitants may remain in that plan, if  they  so  choose,
    through  June  30, 2002.  Annuitants shall not be allowed
    to enroll in or transfer into the  basic  city  plan  for
    Medicare  eligible  annuitants  on or after July 1, 1999.
    The  city  shall   continue   to   offer   annuitants   a
    supplemental   Medicare   Plan   for   Medicare  eligible
    annuitants through June 30, 2002, and the city may  offer
    additional  plans  to Medicare eligible annuitants in its
    sole discretion.  All  Medicare  Plan  annuitant  monthly
    rates  shall be determined in accordance with subsections
    (c) and (g).
    (c)  Effective the date the initial  increased  annuitant
payments  pursuant  to  subsection  (g) take effect, The city
shall pay 50% of  the  aggregated  costs  of  the  claims  or
premiums,   whichever   is   applicable,   as  determined  in
accordance with  subsection  (g),  of  annuitants  and  their
dependents  under  all health care plans offered by the city.
The city may reduce its obligation by  application  of  price
reductions  obtained  as  a  result of financial arrangements
with  providers  or  plan  administrators.   The  claims   or
premiums  of all annuitants and their dependents under all of
the plans offered by the city shall  be  aggregated  for  the
purpose of calculating the city's payment required under this
subsection,  as  well  as for the setting of rates of payment
for annuitants as required under subsection (g).
    (d)  From January 1, 1988 until December  31,  1992,  the
board  shall pay to the city on behalf of each of the board's
annuitants who chooses to participate in any  of  the  city's
plans the following amounts: up to a maximum of $65 per month
for  each  such  annuitant  who  is  not qualified to receive
medicare benefits, and up to a maximum of $35 per  month  for
each  such  annuitant  who  is  qualified to receive medicare
benefits.  From January 1, 1993 until June 30, 2002  December
31,  1997,  the board shall pay to the city on behalf of each
of the board's annuitants who chooses to participate  in  any
of the city's plans the following amounts: up to a maximum of
$75 per month for each such annuitant who is not qualified to
receive  medicare  benefits,  and  up to a maximum of $45 per
month for each such annuitant who  is  qualified  to  receive
medicare benefits.
    For the period January 1, 1988 through the effective date
of  this  amendatory Act of 1989, payments under this Section
shall be reduced by the amounts paid by or on behalf  of  the
board's annuitants covered during that period.
    The  payments  described in this subsection shall be paid
from the tax  levy  authorized  under  Section  11-178;  such
amounts  shall  be credited to the reserve for group hospital
care and group medical and surgical plan  benefits,  and  all
payments  to the city required under this subsection shall be
charged against it.
    (e)  The city's obligations under subsections (b) and (c)
shall terminate on June 30, 2002 December  31,  1997,  except
with  regard  to covered expenses incurred but not paid as of
that  date.   This  subsection   shall   not   affect   other
obligations that may be imposed by law.
    (f)  The  group  coverage plans described in this Section
are  not  and  shall  not  be  construed  to  be  pension  or
retirement benefits for purposes of Section 5 of Article XIII
of the Illinois Constitution of 1970.
    (g)  For each annuitant plan offered  by  the  city,  the
aggregate  cost  of claims, as reflected in the claim records
of the plan administrator, and  premiums  for  each  calendar
year  from 1989 through 1997 of all annuitants and dependents
covered by the  city's  group  health  care  plans  shall  be
estimated  by the city, based upon a written determination by
a qualified independent actuary to be appointed and  paid  by
the  city  and  the board.  If the such estimated annual cost
for each annuitant plan offered by the city is more than  the
estimated  amount to be contributed by the city for that plan
pursuant to subsections (b) and (c) during that year plus the
estimated amounts to be paid pursuant to subsection  (d)  and
by  the other pension boards on behalf of other participating
annuitants, the difference shall be paid by all participating
annuitants participating in the plan, except as  provided  in
subsection  (b).   The  city, based upon the determination of
the independent actuary, shall set the monthly amounts to  be
paid   by   the   participating   annuitants.    The  initial
determination of such payments shall be prospective only  and
shall  be  based  upon the estimated costs for the balance of
the year.  The board may deduct the amounts to be paid by its
annuitants  from  the   participating   annuitants'   monthly
annuities.
    If it is determined from the city's annual audit, or from
audited  experience  data,  that the total amount paid by all
participating annuitants was more or less than the difference
between (1) the cost  of  providing  the  group  health  care
plans,  and  (2) the sum of the amount to be paid by the city
as determined under subsection (c) and the  amounts  paid  by
all  the pension boards, then the independent actuary and the
city shall account for the excess or shortfall  in  the  next
year's   payments   by  annuitants,  except  as  provided  in
subsection (b).
    (h)  An annuitant may elect to terminate  coverage  in  a
plan  at  the end of any month any time, which election shall
terminate the annuitant's  obligation  to  contribute  toward
payment of the excess described in subsection (g).
    (i)  The  city  shall  advise  the  board of all proposed
premium increases for health care at least 75 days  prior  to
the  effective  date of the change, and any increase shall be
prospective only.
(Source: P.A. 86-273.)

    (40 ILCS 5/14-104) (from Ch. 108 1/2, par. 14-104)
    Sec. 14-104. Service for which  contributions  permitted.
Contributions  provided  for  in this Section shall cover the
period of service  granted,  and  be  based  upon  employee's
compensation  and  contribution rate in effect on the date he
last became a member of the System;  provided  that  for  all
employment  prior  to  January  1, 1969 the contribution rate
shall be that in effect for a noncovered employee on the date
he  last  became  a  member  of  the  System.   Contributions
permitted under this Section shall include  regular  interest
from  the date an employee last became a member of the System
to date of payment.
    These  contributions  must  be  paid   in   full   before
retirement either in a lump sum or in installment payments in
accordance with such rules as may be adopted by the board.
    (a)  Any  member  may  make  contributions as required in
this Section for any period of  service,  subsequent  to  the
date of establishment, but prior to the date of membership.
    (b)  Any  employee  who had been previously excluded from
membership because of age at entry  and  subsequently  became
eligible  may elect to make contributions as required in this
Section for  the  period  of  service  during  which  he  was
ineligible.
    (c)  An  employee  of  the  Department  of Insurance who,
after January 1, 1944 but  prior  to  becoming  eligible  for
membership, received salary from funds of insurance companies
in  the  process of rehabilitation, liquidation, conservation
or dissolution, may elect to make contributions  as  required
in this Section for such service.
    (d)  Any  employee who rendered service in a State office
to which he was elected, or rendered service in the  elective
office  of  Clerk of the Appellate Court prior to the date he
became a member, may make contributions for such  service  as
required   in   this  Section.   Any  member  who  served  by
appointment of the Governor under  the  Civil  Administrative
Code  of  Illinois and did not participate in this System may
make contributions as  required  in  this  Section  for  such
service.
    (e)  Any  person employed by the United States government
or any instrumentality or agency thereof from January 1, 1942
through November 15, 1946 as the result of  a  transfer  from
State  service  by  executive  order  of the President of the
United States shall  be  entitled  to  prior  service  credit
covering the period from January 1, 1942 through December 31,
1943  as  provided  for  in  this  Article  and to membership
service credit  for the period from January 1,  1944  through
November  15,  1946  by  making the contributions required in
this Section.  A person so employed on January  1,  1944  but
whose  employment began after January 1, 1942 may qualify for
prior service and membership service credit  under  the  same
conditions.
    (f)  An  employee of the Department of Labor of the State
of  Illinois  who  performed  services  for  and  under   the
supervision  of  that Department prior to January 1, 1944 but
who was compensated for those services  directly  by  federal
funds  and not by a warrant of the Auditor of Public Accounts
paid by the State Treasurer may  establish  credit  for  such
employment  by  making  the  contributions  required  in this
Section. An employee of the Department of Agriculture of  the
State  of  Illinois, who performed services for and under the
supervision of that Department prior to June 1, 1963, but was
compensated for those services directly by federal funds  and
not  paid by a warrant of the Auditor of Public Accounts paid
by the State Treasurer, and who did  not  contribute  to  any
other public employee retirement system for such service, may
establish   credit   for   such   employment  by  making  the
contributions required in this Section.
    (g)  Any employee who executed  a  waiver  of  membership
within  60  days  prior  to  January 1, 1944 may, at any time
while in the service of a department, file with the  board  a
rescission  of  such  waiver.   Upon making the contributions
required by this Section,  the member shall  be  granted  the
creditable  service  that  would  have  been  received if the
waiver had not been executed.
    (h)  Until May 1, 1990, an employee who was employed on a
full-time basis by a  regional  planning  commission  for  at
least 5 continuous years may establish creditable service for
such  employment  by  making the contributions required under
this  Section,  provided  that  any  credits  earned  by  the
employee  in  the  commission's  retirement  plan  have  been
terminated.
    (i)  Any  person  who  rendered  full  time   contractual
services to the General Assembly as a member of a legislative
staff  may establish service credit for up to 8 years of such
services by making  the  contributions  required  under  this
Section, provided that application therefor is made not later
than July 1, 1991.
    (j)  By paying the contributions otherwise required under
this  Section,  plus  an amount determined by the Board to be
equal to the employer's  normal  cost  of  the  benefit  plus
interest,  an  employee  may  establish  service credit for a
period of up to 2 years spent in active military service  for
which  he  does  not qualify for credit under Section 14-105,
provided that (1) he was  not  dishonorably  discharged  from
such  military  service, and (2) the amount of service credit
established by a member under this subsection (j), when added
to the amount of  military  service  credit  granted  to  the
member  under  subsection  (b)  of  Section 14-105, shall not
exceed 5 years.
    (k)  An employee who was employed on a full-time basis by
the  Illinois   State's   Attorneys   Association   Statewide
Appellate Assistance Service LEAA-ILEC grant project prior to
the  time that project became the State's Attorneys Appellate
Service Commission, now the Office of the  State's  Attorneys
Appellate  Prosecutor,  an  agency  of  State government, may
establish creditable service for  not  more  than  60  months
service  for such employment by making contributions required
under this Section.
    (l)  By paying the contributions otherwise required under
this Section, plus an amount determined by the  Board  to  be
equal  to  the  employer's  normal  cost  of the benefit plus
interest, a member may establish service credit  for  periods
of  less  than  one year spent on authorized leave of absence
from service, provided that (1) the period of leave began  on
or  after  January  1, 1982 and (2) any credit established by
the member for the  period  of  leave  in  any  other  public
employee retirement system has been terminated.  A member may
establish  service credit under this subsection for more than
one period of authorized leave, and in that  case  the  total
period of service credit established by the member under this
subsection may exceed one year.
(Source: P.A. 86-273; 86-1488; 87-794; 87-895; 87-1265.)

    (40 ILCS 5/14-104.10 new)
    Sec.  14-104.10.  Federal  or out-of-state employment.  A
contributing employee may establish additional service credit
for periods of full-time employment by the federal government
or a unit  of  state  or  local  government  located  outside
Illinois  for  which  he  or  she does not qualify for credit
under any other provision of this Article, provided that  (i)
the  amount  of  service credit established by a person under
this Section shall not exceed 8 years or 40% of  his  or  her
membership  service  under  this  Article, whichever is less,
(ii) the amount of service credit  established  by  a  person
under  this Section for federal employment, when added to the
amount of all military service credit granted to  the  person
under  this  Article, shall not exceed 8 years, and (iii) any
credit received for the federal or out-of-state employment in
any  federal  or  other  public  employee  pension  fund   or
retirement   system  has  been  terminated  or  relinquished.
Credit may not be established  under  this  Section  for  any
period of military service or for any period for which credit
has  been  or  may be established under Section 14-110 or any
other provision of this Article.
    In order to establish service credit under this  Section,
the applicant must submit a written application to the System
by  June  30, 1998, including documentation of the federal or
out-of-state employment satisfactory to the Board, and pay to
the System (1) employee contributions at the  rates  provided
in  this  Article  based upon the person's salary on the last
day as a participating  employee  prior  to  the  federal  or
out-of-state   employment,   or   on   the  first  day  as  a
participating employee after that  employment,  whichever  is
greater,  plus  (2)  an  amount determined by the Board to be
equal to the employer's normal cost of the  benefits  accrued
for  that  employment, plus (3) regular interest on items (1)
and (2) from the date of conclusion of the employment to  the
date of payment.

    (40 ILCS 5/14-110) (from Ch. 108 1/2, par. 14-110)
    (Text of Section before amendment by P.A. 89-507)
    Sec. 14-110.  Alternative retirement annuity.
    (a)  Any  member  who has withdrawn from service with not
less than 20 years of eligible  creditable  service  and  has
attained  age  55,  and  any  member  who  has withdrawn from
service with not less than 25 years  of  eligible  creditable
service  and  has  attained age 50, regardless of whether the
attainment of either of the specified ages occurs  while  the
member  is  still in service, shall be entitled to receive at
the option of the member, in lieu of the regular  or  minimum
retirement   annuity,   a  retirement   annuity  computed  as
follows:
         (i)  for  periods  of  service   as   a   noncovered
    employee,  2  1/4% of final average compensation for each
    of the first 10 years of creditable service, 2  1/2%  for
    each  year  above  10  years to and including 20 years of
    creditable  service,  and  2  3/4%  for  each   year   of
    creditable service above 20 years; and
         (ii)  for  periods of eligible creditable service as
    a covered employee, 1.67% of final  average  compensation
    for each of the first 10 years of such service, 1.90% for
    each of the next 10 years of such service, 2.10% for each
    year  of  such  service in excess of 20 but not exceeding
    30, and 2.30% for each year in excess of 30.
    Such annuity shall be subject to  a  maximum  of  75%  of
final   average  compensation.   These  rates  shall  not  be
applicable to any service performed by a member as a  covered
employee  which  is not eligible creditable service.  Service
as a  covered  employee  which  is  not  eligible  creditable
service  shall  be  subject  to  the  rates and provisions of
Section 14-108.
    (b)  For  the  purpose   of   this   Section,   "eligible
creditable  service"  means creditable service resulting from
service in one or more of the following positions:
         (1)  State policeman;
         (2)  fire fighter in the fire protection service  of
    a department;
         (3)  air pilot;
         (4)  special agent;
         (5)  investigator for the Secretary of State;
         (6)  conservation police officer;
         (7)  investigator for the Department of Revenue;
         (8)  security  employee  of the Department of Mental
    Health and Developmental Disabilities;
         (9)  Central  Management  Services  security  police
    officer;
         (10)  security  employee  of   the   Department   of
    Corrections;
         (11)  dangerous drugs investigator;
         (12)  investigator   for  the  Department  of  State
    Police;
         (13)  investigator for the Office  of  the  Attorney
    General;
         (14)  controlled substance inspector;
         (15)  investigator  for  the  Office  of the State's
    Attorneys Appellate Prosecutor;
         (16)  Commerce Commission police officer;
         (17)  arson investigator.
    A person employed in one of the  positions  specified  in
this  subsection  is  entitled to eligible creditable service
for service credit earned under this Article while undergoing
the basic police training course  approved  by  the  Illinois
Local  Governmental  Law Enforcement Officers Training Board,
if completion of that training is required of persons serving
in that position.  For the purposes  of  this  Code,  service
during  the  required  basic  police training course shall be
deemed performance of the duties of the  specified  position,
even  though  the  person is not a sworn peace officer at the
time of the training.
    (c)  For the purposes of this Section:
         (1)  The term "state policeman" includes  any  title
    or  position  in  the  Department of State Police that is
    held by an individual employed  under  the  State  Police
    Act.
         (2)  The  term  "fire fighter in the fire protection
    service of a department" includes all  officers  in  such
    fire   protection   service  including  fire  chiefs  and
    assistant fire chiefs.
         (3)  The term  "air  pilot"  includes  any  employee
    whose  official job description on file in the Department
    of Central Management Services, or in the  department  by
    which he is employed if that department is not covered by
    the Personnel Code, states that his principal duty is the
    operation  of  aircraft,  and  who  possesses  a  pilot's
    license;  however,  the change in this definition made by
    this amendatory Act of 1983 shall not operate to  exclude
    any  noncovered  employee  who was an "air pilot" for the
    purposes of this Section on January 1, 1984.
         (4)  The term "special agent" means any  person  who
    by  reason  of  employment  by  the  Division of Narcotic
    Control, the Bureau of Investigation or,  after  July  1,
    1977,   the   Division  of  Criminal  Investigation,  the
    Division of Internal Investigation or any other  Division
    or  organizational  entity  in  the  Department  of State
    Police is vested by law with duties  to  maintain  public
    order, investigate violations of the criminal law of this
    State,  enforce  the laws of this State, make arrests and
    recover property.  The term "special agent" includes  any
    title  or position in the Department of State Police that
    is held by an individual employed under the State  Police
    Act.
         (5)  The  term  "investigator  for  the Secretary of
    State" means any person employed by  the  Office  of  the
    Secretary  of  State  and  vested with such investigative
    duties as render him ineligible for  coverage  under  the
    Social  Security  Act by reason of Sections 218(d)(5)(A),
    218(d)(8)(D) and 218(l)(1) of that Act.
         A person who became employed as an investigator  for
    the  Secretary  of  State  between  January  1,  1967 and
    December 31, 1975, and  who  has  served  as  such  until
    attainment  of  age  60,  either  continuously  or with a
    single  break  in  service  of  not  more  than  3  years
    duration, which break terminated before January 1,  1976,
    shall   be   entitled  to  have  his  retirement  annuity
    calculated    in   accordance   with   subsection    (a),
    notwithstanding  that he has less than 20 years of credit
    for such service.
         (6)  The term "Conservation  Police  Officer"  means
    any person employed by the Division of Law Enforcement of
    the  Department of Natural Resources and vested with such
    law enforcement  duties  as  render  him  ineligible  for
    coverage  under  the  Social  Security  Act  by reason of
    Sections 218(d)(5)(A),  218(d)(8)(D),  and  218(l)(1)  of
    that   Act.    The  term  "Conservation  Police  Officer"
    includes  the  positions  of  Chief  Conservation  Police
    Administrator   and   Assistant    Conservation    Police
    Administrator.
         (7)  The  term  "investigator  for the Department of
    Revenue" means any person employed by the  Department  of
    Revenue  and  vested  with  such  investigative duties as
    render him  ineligible  for  coverage  under  the  Social
    Security   Act   by   reason  of  Sections  218(d)(5)(A),
    218(d)(8)(D) and 218(l)(1) of that Act.
         (8)  The term "security employee of  the  Department
    of  Mental  Health  and Developmental Disabilities" means
    any person employed by the Department  of  Mental  Health
    and  Developmental  Disabilities  who  is employed at the
    Chester Mental Health Center and has daily  contact  with
    the  residents  thereof, or who is a mental health police
    officer.  "Mental health police officer" means any person
    employed  by  the  Department  of   Mental   Health   and
    Developmental  Disabilities  who  is vested with such law
    enforcement duties as render him ineligible for  coverage
    under  the  Social  Security  Act  by  reason of Sections
    218(d)(5)(A), 218(d)(8)(D) and 218(l)(1) of that Act.
         (9)  "Central Management  Services  security  police
    officer"  means  any person employed by the Department of
    Central Management Services who is vested with  such  law
    enforcement  duties as render him ineligible for coverage
    under the Social  Security  Act  by  reason  of  Sections
    218(d)(5)(A), 218(d)(8)(D) and 218(l)(1) of that Act.
         (10)  The  term "security employee of the Department
    of Corrections" means any employee of the  Department  of
    Corrections  or  the  former Department of Personnel, and
    any member or employee of the Prisoner Review Board,  who
    has  daily  contact  with  inmates  by  working  within a
    correctional facility or who is a parole  officer  or  an
    employee who has direct contact with committed persons in
    the performance of his or her job duties.
         (11)  The  term "dangerous drugs investigator" means
    any person who is employed as such by the  Department  of
    Alcoholism and Substance Abuse.
         (12)  The  term  "investigator for the Department of
    State Police" means a person employed by  the  Department
    of  State  Police  who  is  vested under Section 4 of the
    Narcotic Control Division Abolition Act   with  such  law
    enforcement  powers as render him ineligible for coverage
    under the Social  Security  Act  by  reason  of  Sections
    218(d)(5)(A), 218(d)(8)(D) and 218(l)(1) of that Act.
         (13)  "Investigator  for  the Office of the Attorney
    General" means any person who is employed as such by  the
    Office  of  the  Attorney General and is vested with such
    investigative  duties  as  render  him   ineligible   for
    coverage  under  the  Social  Security  Act  by reason of
    Sections 218(d)(5)(A), 218(d)(8)(D) and 218(l)(1) of that
    Act.  For the period before January  1,  1989,  the  term
    includes  all  persons who were employed as investigators
    by the Office of the Attorney General, without regard  to
    social security status.
         (14)  "Controlled  substance  inspector"  means  any
    person  who  is  employed  as  such  by the Department of
    Professional Regulation  and  is  vested  with  such  law
    enforcement  duties as render him ineligible for coverage
    under the Social  Security  Act  by  reason  of  Sections
    218(d)(5)(A),  218(d)(8)(D)  and  218(l)(1)  of that Act.
    The term "controlled substance  inspector"  includes  the
    Program   Executive  of  Enforcement  and  the  Assistant
    Program Executive of Enforcement.
         (15)  The term "investigator for the Office  of  the
    State's  Attorneys  Appellate  Prosecutor" means a person
    employed in that capacity on a full time basis under  the
    authority  of  Section  7.06  of  the  State's  Attorneys
    Appellate Prosecutor's Act.
         (16)  "Commerce Commission police officer" means any
    person  employed  by the Illinois Commerce Commission who
    is vested with such law enforcement duties as render  him
    ineligible  for coverage under the Social Security Act by
    reason  of  Sections  218(d)(5)(A),   218(d)(8)(D),   and
    218(l)(1) of that Act.
         (17)  "Arson  investigator"  means any person who is
    employed as such by the Office of the State Fire  Marshal
    and  is vested with such law enforcement duties as render
    the person  ineligible  for  coverage  under  the  Social
    Security   Act   by   reason  of  Sections  218(d)(5)(A),
    218(d)(8)(D), and 218(l)(1) of that Act.   A  person  who
    was  employed as an arson investigator on January 1, 1995
    and is no longer in  service  but  not  yet  receiving  a
    retirement  annuity  may  convert  his  or her creditable
    service for employment  as  an  arson  investigator  into
    eligible  creditable  service by paying to the System the
    difference between the  employee  contributions  actually
    paid  for  that  service  and the amounts that would have
    been contributed if the applicant  were  contributing  at
    the  rate  applicable  to  persons  with  the same social
    security status earning eligible  creditable  service  on
    the date of application.
    (d)  A   security   employee   of   the   Department   of
Corrections,  and  a  security  employee of the Department of
Mental Health and Developmental Disabilities  who  is  not  a
mental  health  police officer, shall not be eligible for the
alternative  retirement  annuity  provided  by  this  Section
unless he or she meets the following minimum age and  service
requirements at the time of retirement:
         (i)  25 years of eligible creditable service and age
    55; or
         (ii)  beginning   January   1,  1987,  25  years  of
    eligible creditable service and age 54, or  24  years  of
    eligible creditable service and age 55; or
         (iii)  beginning   January  1,  1988,  25  years  of
    eligible creditable service and age 53, or  23  years  of
    eligible creditable service and age 55; or
         (iv)  beginning   January   1,  1989,  25  years  of
    eligible creditable service and age 52, or  22  years  of
    eligible creditable service and age 55; or
         (v)  beginning January 1, 1990, 25 years of eligible
    creditable  service  and  age 51, or 21 years of eligible
    creditable service and age 55; or
         (vi)  beginning  January  1,  1991,  25   years   of
    eligible  creditable  service  and age 50, or 20 years of
    eligible creditable service and age 55.
    Persons who have service credit under Article 16 of  this
Code  for service as a security employee of the Department of
Corrections  in  a  position  requiring  certification  as  a
teacher may count  such  service  toward  establishing  their
eligibility  under  the service requirements of this Section;
but such service may  be  used  only  for  establishing  such
eligibility,  and  not  for  the  purpose  of  increasing  or
calculating any benefit.
    (e)  If a member enters military service while working in
a  position  in  which  eligible  creditable  service  may be
earned, and returns to State service in the same  or  another
such  position,  and  fulfills  in  all  other  respects  the
conditions prescribed in this Article for credit for military
service,  such military service shall be credited as eligible
creditable service for the purposes of the retirement annuity
prescribed in this Section.
    (f)  For purposes  of  calculating  retirement  annuities
under   this  Section,  periods  of  service  rendered  after
December 31, 1968 and before October 1,  1975  as  a  covered
employee  in  the  position  of  special  agent, conservation
police officer, mental health police officer, or investigator
for the Secretary of State, shall  be  deemed  to  have  been
service  as a noncovered employee, provided that the employee
pays to the System prior to retirement an amount equal to (1)
the difference between the employee contributions that  would
have been required for such service as a noncovered employee,
and  the amount of employee contributions actually paid, plus
(2) if payment is made after July 31, 1987, regular  interest
on  the amount specified in item (1) from the date of service
to the date of payment.
    For purposes of calculating  retirement  annuities  under
this  Section, periods of service rendered after December 31,
1968 and before January 1, 1982 as a covered employee in  the
position  of investigator for the Department of Revenue shall
be deemed to have been  service  as  a  noncovered  employee,
provided  that  the  employee  pays  to  the  System prior to
retirement an amount equal to (1) the difference between  the
employee contributions that would have been required for such
service  as a noncovered employee, and the amount of employee
contributions actually paid, plus  (2)  if  payment  is  made
after  January  1,  1990,  regular  interest  on  the  amount
specified in item (1) from the date of service to the date of
payment.
    (g)  A  State policeman may elect, not later than January
1, 1990, to establish eligible creditable service for  up  to
10  years  of  his service as a policeman under Article 3, by
filing a written election  with  the  Board,  accompanied  by
payment  of an amount to be determined by the Board, equal to
(i)  the  difference  between  the  amount  of  employee  and
employer  contributions  transferred  to  the  System   under
Section  3-110.5,  and  the  amounts  that  would  have  been
contributed  had  such  contributions  been made at the rates
applicable to State policemen, plus (ii) interest thereon  at
the  effective  rate for each year, compounded annually, from
the date of service to the date of payment.
    Subject to the limitation  in  subsection  (i),  a  State
policeman  may  elect,  not  later  than  July  1,  1993,  to
establish  eligible  creditable service for up to 10 years of
his service as a member of the County Police Department under
Article 9, by filing  a  written  election  with  the  Board,
accompanied  by  payment of an amount to be determined by the
Board, equal to (i) the  difference  between  the  amount  of
employee and employer contributions transferred to the System
under  Section  9-121.10 and the amounts that would have been
contributed had those contributions been made  at  the  rates
applicable  to State policemen, plus (ii) interest thereon at
the effective rate for each year, compounded  annually,  from
the date of service to the date of payment.
    (h)  Subject to the limitation in subsection (i), a State
policeman  or  investigator  for  the  Secretary of State may
elect to establish eligible creditable service for up  to  12
years  of  his  service  as  a  policeman under Article 5, by
filing a written election with the Board on or before January
31, 1992, and paying to the System by  January  31,  1994  an
amount  to  be  determined  by  the  Board,  equal to (i) the
difference  between  the  amount  of  employee  and  employer
contributions transferred to the System under Section  5-236,
and  the  amounts  that  would have been contributed had such
contributions been made at  the  rates  applicable  to  State
policemen,  plus  (ii) interest thereon at the effective rate
for each year, compounded annually, from the date of  service
to the date of payment.
    Subject  to  the  limitation  in  subsection (i), a State
policeman, conservation police officer, or  investigator  for
the  Secretary  of  State  may  elect  to  establish eligible
creditable service for  up  to  10  years  of  service  as  a
sheriff's law enforcement employee under Article 7, by filing
a  written  election  with the Board on or before January 31,
1993, and paying to the System by January 31, 1994 an  amount
to  be  determined  by the Board, equal to (i) the difference
between the amount of  employee  and  employer  contributions
transferred  to  the  System  under  Section 7-139.7, and the
amounts  that  would   have   been   contributed   had   such
contributions  been  made  at  the  rates applicable to State
policemen, plus (ii) interest thereon at the  effective  rate
for  each year, compounded annually, from the date of service
to the date of payment.
    (i)  The total  amount  of  eligible  creditable  service
established  by  any  person  under subsections (g), (h), and
(j), (k), and (l) of this Section shall not exceed 12 years.
    (j)  Subject to the  limitation  in  subsection  (i),  an
investigator   for   the  Office  of  the  State's  Attorneys
Appellate Prosecutor or a controlled substance inspector  may
elect  to  establish eligible creditable service for up to 10
years of his service as a policeman  under  Article  3  or  a
sheriff's law enforcement employee under Article 7, by filing
a  written election with the Board, accompanied by payment of
an amount to be determined by the Board,  equal  to  (1)  the
difference  between  the  amount  of  employee  and  employer
contributions transferred to the System under Section 3-110.6
or  7-139.8, and the amounts that would have been contributed
had such contributions been made at the rates  applicable  to
State  policemen,  plus (2) interest thereon at the effective
rate for each year, compounded annually,  from  the  date  of
service to the date of payment.
    (k)  Subject  to the limitation in subsection (i) of this
Section,  an  alternative  formula  employee  may  elect   to
establish  eligible creditable service for periods spent as a
full-time law enforcement officer  or  full-time  corrections
officer  employed  by the federal government or by a state or
local government  located  outside  of  Illinois,  for  which
credit  is not held in any other public employee pension fund
or retirement system.  To obtain this credit,  the  applicant
must  file  a written application with the Board by March 31,
1998, accompanied by evidence of  eligibility  acceptable  to
the  Board  and  payment of an amount to be determined by the
Board, equal to (1) employee  contributions  for  the  credit
being  established,  based upon the applicant's salary on the
first day  as  an  alternative  formula  employee  after  the
employment  for  which  credit  is  being established and the
rates then applicable to alternative formula employees,  plus
(2)  an  amount  determined by the Board to be the employer's
normal cost of the benefits  accrued  for  the  credit  being
established,  plus  (3)  regular  interest  on the amounts in
items (1) and (2)  from  the  first  day  as  an  alternative
formula  employee  after  the  employment for which credit is
being established to the date of payment.
    (l)  Subject to  the  limitation  in  subsection  (i),  a
security employee of the Department of Corrections may elect,
not later than July 1, 1998, to establish eligible creditable
service  for  up  to  10  years  of  his  or her service as a
policeman under Article 3, by filing a written election  with
the  Board,  accompanied  by  payment  of  an  amount  to  be
determined  by the Board, equal to (i) the difference between
the amount of employee and employer contributions transferred
to the System under Section 3-110.5,  and  the  amounts  that
would  have been contributed had such contributions been made
at  the  rates  applicable  to  security  employees  of   the
Department  of Corrections, plus (ii) interest thereon at the
effective rate for each year, compounded annually,  from  the
date of service to the date of payment.
(Source: P.A. 89-136, eff. 7-14-95; 89-445, eff. 2-7-96.)

    (Text of Section after amendment by P.A. 89-507)
    Sec. 14-110.  Alternative retirement annuity.
    (a)  Any  member  who has withdrawn from service with not
less than 20 years of eligible  creditable  service  and  has
attained  age  55,  and  any  member  who  has withdrawn from
service with not less than 25 years  of  eligible  creditable
service  and  has  attained age 50, regardless of whether the
attainment of either of the specified ages occurs  while  the
member  is  still in service, shall be entitled to receive at
the option of the member, in lieu of the regular  or  minimum
retirement   annuity,   a  retirement   annuity  computed  as
follows:
         (i)  for  periods  of  service   as   a   noncovered
    employee,  2  1/4% of final average compensation for each
    of the first 10 years of creditable service, 2  1/2%  for
    each  year  above  10  years to and including 20 years of
    creditable  service,  and  2  3/4%  for  each   year   of
    creditable service above 20 years; and
         (ii)  for  periods of eligible creditable service as
    a covered employee, 1.67% of final  average  compensation
    for each of the first 10 years of such service, 1.90% for
    each of the next 10 years of such service, 2.10% for each
    year  of  such  service in excess of 20 but not exceeding
    30, and 2.30% for each year in excess of 30.
    Such annuity shall be subject to  a  maximum  of  75%  of
final   average  compensation.   These  rates  shall  not  be
applicable to any service performed by a member as a  covered
employee  which  is not eligible creditable service.  Service
as a  covered  employee  which  is  not  eligible  creditable
service  shall  be  subject  to  the  rates and provisions of
Section 14-108.
    (b)  For  the  purpose   of   this   Section,   "eligible
creditable  service"  means creditable service resulting from
service in one or more of the following positions:
         (1)  State policeman;
         (2)  fire fighter in the fire protection service  of
    a department;
         (3)  air pilot;
         (4)  special agent;
         (5)  investigator for the Secretary of State;
         (6)  conservation police officer;
         (7)  investigator for the Department of Revenue;
         (8)  security  employee  of  the Department of Human
    Services;
         (9)  Central  Management  Services  security  police
    officer;
         (10)  security  employee  of   the   Department   of
    Corrections;
         (11)  dangerous drugs investigator;
         (12)  investigator   for  the  Department  of  State
    Police;
         (13)  investigator for the Office  of  the  Attorney
    General;
         (14)  controlled substance inspector;
         (15)  investigator  for  the  Office  of the State's
    Attorneys Appellate Prosecutor;
         (16)  Commerce Commission police officer;
         (17)  arson investigator.
    A person employed in one of the  positions  specified  in
this  subsection  is  entitled to eligible creditable service
for service credit earned under this Article while undergoing
the basic police training course  approved  by  the  Illinois
Local  Governmental  Law Enforcement Officers Training Board,
if completion of that training is required of persons serving
in that position.  For the purposes  of  this  Code,  service
during  the  required  basic  police training course shall be
deemed performance of the duties of the  specified  position,
even  though  the  person is not a sworn peace officer at the
time of the training.
    (c)  For the purposes of this Section:
         (1)  The term "state policeman" includes  any  title
    or  position  in  the  Department of State Police that is
    held by an individual employed  under  the  State  Police
    Act.
         (2)  The  term  "fire fighter in the fire protection
    service of a department" includes all  officers  in  such
    fire   protection   service  including  fire  chiefs  and
    assistant fire chiefs.
         (3)  The term  "air  pilot"  includes  any  employee
    whose  official job description on file in the Department
    of Central Management Services, or in the  department  by
    which he is employed if that department is not covered by
    the Personnel Code, states that his principal duty is the
    operation  of  aircraft,  and  who  possesses  a  pilot's
    license;  however,  the change in this definition made by
    this amendatory Act of 1983 shall not operate to  exclude
    any  noncovered  employee  who was an "air pilot" for the
    purposes of this Section on January 1, 1984.
         (4)  The term "special agent" means any  person  who
    by  reason  of  employment  by  the  Division of Narcotic
    Control, the Bureau of Investigation or,  after  July  1,
    1977,   the   Division  of  Criminal  Investigation,  the
    Division of Internal Investigation or any other  Division
    or  organizational  entity  in  the  Department  of State
    Police is vested by law with duties  to  maintain  public
    order, investigate violations of the criminal law of this
    State,  enforce  the laws of this State, make arrests and
    recover property.  The term "special agent" includes  any
    title  or position in the Department of State Police that
    is held by an individual employed under the State  Police
    Act.
         (5)  The  term  "investigator  for  the Secretary of
    State" means any person employed by  the  Office  of  the
    Secretary  of  State  and  vested with such investigative
    duties as render him ineligible for  coverage  under  the
    Social  Security  Act by reason of Sections 218(d)(5)(A),
    218(d)(8)(D) and 218(l)(1) of that Act.
         A person who became employed as an investigator  for
    the  Secretary  of  State  between  January  1,  1967 and
    December 31, 1975, and  who  has  served  as  such  until
    attainment  of  age  60,  either  continuously  or with a
    single  break  in  service  of  not  more  than  3  years
    duration, which break terminated before January 1,  1976,
    shall   be   entitled  to  have  his  retirement  annuity
    calculated    in   accordance   with   subsection    (a),
    notwithstanding  that he has less than 20 years of credit
    for such service.
         (6)  The term "Conservation  Police  Officer"  means
    any person employed by the Division of Law Enforcement of
    the  Department of Natural Resources and vested with such
    law enforcement  duties  as  render  him  ineligible  for
    coverage  under  the  Social  Security  Act  by reason of
    Sections 218(d)(5)(A),  218(d)(8)(D),  and  218(l)(1)  of
    that   Act.    The  term  "Conservation  Police  Officer"
    includes  the  positions  of  Chief  Conservation  Police
    Administrator   and   Assistant    Conservation    Police
    Administrator.
         (7)  The  term  "investigator  for the Department of
    Revenue" means any person employed by the  Department  of
    Revenue  and  vested  with  such  investigative duties as
    render him  ineligible  for  coverage  under  the  Social
    Security   Act   by   reason  of  Sections  218(d)(5)(A),
    218(d)(8)(D) and 218(l)(1) of that Act.
         (8)  The term "security employee of  the  Department
    of  Human  Services"  means  any  person  employed by the
    Department of Human  Services  who  is  employed  at  the
    Chester  Mental  Health Center and has daily contact with
    the residents thereof, or who is a mental  health  police
    officer.  "Mental health police officer" means any person
    employed  by  the  Department  of  Human  Services  in  a
    position pertaining to the Department's mental health and
    developmental  disabilities  functions who is vested with
    such  law  enforcement  duties  as  render   the   person
    ineligible  for coverage under the Social Security Act by
    reason  of  Sections   218(d)(5)(A),   218(d)(8)(D)   and
    218(l)(1) of that Act.
         (9)  "Central  Management  Services  security police
    officer" means any person employed by the  Department  of
    Central  Management  Services who is vested with such law
    enforcement duties as render him ineligible for  coverage
    under  the  Social  Security  Act  by  reason of Sections
    218(d)(5)(A), 218(d)(8)(D) and 218(l)(1) of that Act.
         (10)  The term "security employee of the  Department
    of  Corrections"  means any employee of the Department of
    Corrections or the former Department  of  Personnel,  and
    any  member or employee of the Prisoner Review Board, who
    has daily  contact  with  inmates  by  working  within  a
    correctional  facility  or  who is a parole officer or an
    employee who has direct contact with committed persons in
    the performance of his or her job duties.
         (11)  The term "dangerous drugs investigator"  means
    any  person  who is employed as such by the Department of
    Human Services.
         (12)  The term "investigator for the  Department  of
    State  Police"  means a person employed by the Department
    of State Police who is vested  under  Section  4  of  the
    Narcotic  Control  Division  Abolition  Act with such law
    enforcement powers as render him ineligible for  coverage
    under  the  Social  Security  Act  by  reason of Sections
    218(d)(5)(A), 218(d)(8)(D) and 218(l)(1) of that Act.
         (13)  "Investigator for the Office of  the  Attorney
    General"  means any person who is employed as such by the
    Office of the Attorney General and is  vested  with  such
    investigative   duties   as  render  him  ineligible  for
    coverage under the  Social  Security  Act  by  reason  of
    Sections 218(d)(5)(A), 218(d)(8)(D) and 218(l)(1) of that
    Act.   For  the  period  before January 1, 1989, the term
    includes all persons who were employed  as  investigators
    by  the Office of the Attorney General, without regard to
    social security status.
         (14)  "Controlled  substance  inspector"  means  any
    person who is employed  as  such  by  the  Department  of
    Professional  Regulation  and  is  vested  with  such law
    enforcement duties as render him ineligible for  coverage
    under  the  Social  Security  Act  by  reason of Sections
    218(d)(5)(A), 218(d)(8)(D) and  218(l)(1)  of  that  Act.
    The  term  "controlled  substance inspector" includes the
    Program  Executive  of  Enforcement  and  the   Assistant
    Program Executive of Enforcement.
         (15)  The  term  "investigator for the Office of the
    State's Attorneys Appellate Prosecutor"  means  a  person
    employed  in that capacity on a full time basis under the
    authority  of  Section  7.06  of  the  State's  Attorneys
    Appellate Prosecutor's Act.
         (16)  "Commerce Commission police officer" means any
    person employed by the Illinois Commerce  Commission  who
    is  vested with such law enforcement duties as render him
    ineligible for coverage under the Social Security Act  by
    reason   of   Sections  218(d)(5)(A),  218(d)(8)(D),  and
    218(l)(1) of that Act.
         (17)  "Arson investigator" means any person  who  is
    employed  as such by the Office of the State Fire Marshal
    and is vested with such law enforcement duties as  render
    the  person  ineligible  for  coverage  under  the Social
    Security  Act  by  reason   of   Sections   218(d)(5)(A),
    218(d)(8)(D),  and  218(l)(1)  of that Act.  A person who
    was employed as an arson investigator on January 1,  1995
    and  is  no  longer  in  service  but not yet receiving a
    retirement annuity may  convert  his  or  her  creditable
    service  for  employment  as  an  arson investigator into
    eligible creditable service by paying to the  System  the
    difference  between  the  employee contributions actually
    paid for that service and the  amounts  that  would  have
    been  contributed  if  the applicant were contributing at
    the rate applicable  to  persons  with  the  same  social
    security  status  earning  eligible creditable service on
    the date of application.
    (d)  A   security   employee   of   the   Department   of
Corrections, and a security employee  of  the  Department  of
Human  Services  who  is  not a mental health police officer,
shall not be eligible for the alternative retirement  annuity
provided by this Section unless he or she meets the following
minimum   age   and  service  requirements  at  the  time  of
retirement:
         (i)  25 years of eligible creditable service and age
    55; or
         (ii)  beginning  January  1,  1987,  25   years   of
    eligible  creditable  service  and age 54, or 24 years of
    eligible creditable service and age 55; or
         (iii)  beginning  January  1,  1988,  25  years   of
    eligible  creditable  service  and age 53, or 23 years of
    eligible creditable service and age 55; or
         (iv)  beginning  January  1,  1989,  25   years   of
    eligible  creditable  service  and age 52, or 22 years of
    eligible creditable service and age 55; or
         (v)  beginning January 1, 1990, 25 years of eligible
    creditable service and age 51, or 21  years  of  eligible
    creditable service and age 55; or
         (vi)  beginning   January   1,  1991,  25  years  of
    eligible creditable service and age 50, or  20  years  of
    eligible creditable service and age 55.
    Persons  who have service credit under Article 16 of this
Code for service as a security employee of the Department  of
Corrections  in  a  position  requiring  certification  as  a
teacher  may  count  such  service  toward establishing their
eligibility under the service requirements of  this  Section;
but  such  service  may  be  used  only for establishing such
eligibility,  and  not  for  the  purpose  of  increasing  or
calculating any benefit.
    (e)  If a member enters military service while working in
a position  in  which  eligible  creditable  service  may  be
earned,  and  returns to State service in the same or another
such  position,  and  fulfills  in  all  other  respects  the
conditions prescribed in this Article for credit for military
service, such military service shall be credited as  eligible
creditable service for the purposes of the retirement annuity
prescribed in this Section.
    (f)  For  purposes  of  calculating  retirement annuities
under  this  Section,  periods  of  service  rendered   after
December  31,  1968  and  before October 1, 1975 as a covered
employee in  the  position  of  special  agent,  conservation
police officer, mental health police officer, or investigator
for  the  Secretary  of  State,  shall be deemed to have been
service as a noncovered employee, provided that the  employee
pays to the System prior to retirement an amount equal to (1)
the  difference between the employee contributions that would
have been required for such service as a noncovered employee,
and the amount of employee contributions actually paid,  plus
(2)  if payment is made after July 31, 1987, regular interest
on the amount specified in item (1) from the date of  service
to the date of payment.
    For  purposes  of  calculating retirement annuities under
this Section, periods of service rendered after December  31,
1968  and before January 1, 1982 as a covered employee in the
position of investigator for the Department of Revenue  shall
be  deemed  to  have  been  service as a noncovered employee,
provided that the  employee  pays  to  the  System  prior  to
retirement  an amount equal to (1) the difference between the
employee contributions that would have been required for such
service as a noncovered employee, and the amount of  employee
contributions  actually  paid,  plus  (2)  if payment is made
after  January  1,  1990,  regular  interest  on  the  amount
specified in item (1) from the date of service to the date of
payment.
    (g)  A State policeman may elect, not later than  January
1,  1990,  to establish eligible creditable service for up to
10 years of his service as a policeman under  Article  3,  by
filing  a  written  election  with  the Board, accompanied by
payment of an amount to be determined by the Board, equal  to
(i)  the  difference  between  the  amount  of  employee  and
employer   contributions  transferred  to  the  System  under
Section  3-110.5,  and  the  amounts  that  would  have  been
contributed had such contributions been  made  at  the  rates
applicable  to State policemen, plus (ii) interest thereon at
the effective rate for each year, compounded  annually,  from
the date of service to the date of payment.
    Subject  to  the  limitation  in  subsection (i), a State
policeman  may  elect,  not  later  than  July  1,  1993,  to
establish eligible creditable service for up to 10  years  of
his service as a member of the County Police Department under
Article  9,  by  filing  a  written  election with the Board,
accompanied by payment of an amount to be determined  by  the
Board,  equal  to  (i)  the  difference between the amount of
employee and employer contributions transferred to the System
under Section 9-121.10 and the amounts that would  have  been
contributed  had  those  contributions been made at the rates
applicable to State policemen, plus (ii) interest thereon  at
the  effective  rate for each year, compounded annually, from
the date of service to the date of payment.
    (h)  Subject to the limitation in subsection (i), a State
policeman or investigator for  the  Secretary  of  State  may
elect  to  establish eligible creditable service for up to 12
years of his service as  a  policeman  under  Article  5,  by
filing a written election with the Board on or before January
31,  1992,  and  paying  to the System by January 31, 1994 an
amount to be determined  by  the  Board,  equal  to  (i)  the
difference  between  the  amount  of  employee  and  employer
contributions  transferred to the System under Section 5-236,
and the amounts that would have  been  contributed  had  such
contributions  been  made  at  the  rates applicable to State
policemen, plus (ii) interest thereon at the  effective  rate
for  each year, compounded annually, from the date of service
to the date of payment.
    Subject to the limitation  in  subsection  (i),  a  State
policeman,  conservation  police officer, or investigator for
the Secretary  of  State  may  elect  to  establish  eligible
creditable  service  for  up  to  10  years  of  service as a
sheriff's law enforcement employee under Article 7, by filing
a written election with the Board on or  before  January  31,
1993,  and paying to the System by January 31, 1994 an amount
to be determined by the Board, equal to  (i)  the  difference
between  the  amount  of  employee and employer contributions
transferred to the System  under  Section  7-139.7,  and  the
amounts   that   would   have   been   contributed  had  such
contributions been made at  the  rates  applicable  to  State
policemen,  plus  (ii) interest thereon at the effective rate
for each year, compounded annually, from the date of  service
to the date of payment.
    (i)  The  total  amount  of  eligible  creditable service
established by any person under  subsections  (g),  (h),  and
(j), (k), and (l) of this Section shall not exceed 12 years.
    (j)  Subject  to  the  limitation  in  subsection (i), an
investigator  for  the  Office  of  the   State's   Attorneys
Appellate  Prosecutor or a controlled substance inspector may
elect to establish eligible creditable service for up  to  10
years  of  his  service  as  a policeman under Article 3 or a
sheriff's law enforcement employee under Article 7, by filing
a written election with the Board, accompanied by payment  of
an  amount  to  be  determined by the Board, equal to (1) the
difference  between  the  amount  of  employee  and  employer
contributions transferred to the System under Section 3-110.6
or 7-139.8, and the amounts that would have been  contributed
had  such  contributions been made at the rates applicable to
State policemen, plus (2) interest thereon at  the  effective
rate  for  each  year,  compounded annually, from the date of
service to the date of payment.
    (k)  Subject to the limitation in subsection (i) of  this
Section,   an  alternative  formula  employee  may  elect  to
establish eligible creditable service for periods spent as  a
full-time  law  enforcement  officer or full-time corrections
officer employed by the federal government or by a  state  or
local  government  located  outside  of  Illinois,  for which
credit is not held in any other public employee pension  fund
or  retirement  system.  To obtain this credit, the applicant
must file a written application with the Board by  March  31,
1998,  accompanied  by  evidence of eligibility acceptable to
the Board and payment of an amount to be  determined  by  the
Board,  equal  to  (1)  employee contributions for the credit
being established, based upon the applicant's salary  on  the
first  day  as  an  alternative  formula  employee  after the
employment for which credit  is  being  established  and  the
rates  then applicable to alternative formula employees, plus
(2) an amount determined by the Board to  be  the  employer's
normal  cost  of  the  benefits  accrued for the credit being
established, plus (3) regular  interest  on  the  amounts  in
items  (1)  and  (2)  from  the  first  day as an alternative
formula employee after the employment  for  which  credit  is
being established to the date of payment.
    (l)  Subject  to  the  limitation  in  subsection  (i), a
security employee of the Department of Corrections may elect,
not later than July 1, 1998, to establish eligible creditable
service for up to 10  years  of  his  or  her  service  as  a
policeman  under Article 3, by filing a written election with
the  Board,  accompanied  by  payment  of  an  amount  to  be
determined by the Board, equal to (i) the difference  between
the amount of employee and employer contributions transferred
to  the  System  under  Section 3-110.5, and the amounts that
would have been contributed had such contributions been  made
at   the  rates  applicable  to  security  employees  of  the
Department of Corrections, plus (ii) interest thereon at  the
effective  rate  for each year, compounded annually, from the
date of service to the date of payment.
(Source: P.A. 89-136,  eff.  7-14-95;  89-445,  eff.  2-7-96;
89-507, eff. 7-1-97.)

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

    (40 ILCS 5/15-157.1) (from Ch. 108 1/2, par. 15-157.1)
    Sec. 15-157.1.  Pickup Pick up of employee contributions.
    (a)  Each   employer   shall   pick   up   the   employee
contributions required under subsections (a), (b), and (c) of
Section 15-157 for all earnings payments made  on  and  after
January  1, 1981, and the contributions so picked up shall be
treated  as  employer  contributions   in   determining   tax
treatment  under  the  United  States  Internal Revenue Code.
These contributions shall not be included as gross income  of
the  participant  until  such time as they are distributed or
made  available.   The  employer  shall  pay  these  employee
contributions from the same source of funds which is used  in
paying  earnings  to  the employee.  The employer may pick up
these contributions by a reduction in the cash salary of  the
participants,  or  by  an  offset  against  a  future  salary
increase,  or  by  a combination of a reduction in salary and
offset against a future salary increase.
    (b)  Subject  to  the  requirements  of  federal  law,  a
participating employee may elect to have the employer pick up
optional contributions that the participant  has  elected  to
pay   to   the   System  under  Section  15-157(g),  and  the
contributions so picked  up  shall  be  treated  as  employer
contributions  for  the  purposes  of determining federal tax
treatment under the federal Internal Revenue  Code  of  1986.
These  contributions shall not be included as gross income of
the participant until such time as they  are  distributed  or
made available.  The employer shall pick up the contributions
by  a  reduction  in  the  cash salary of the participant and
shall pay the contributions from the  same  source  of  funds
that  is  used  to  pay  earnings  to  the  participant.  The
election  to  have  optional  contributions  picked   up   is
irrevocable.
(Source: P.A. 83-1440.)

    (40 ILCS 5/16-127) (from Ch. 108 1/2, par. 16-127)
    Sec. 16-127.  Computation of creditable service.
    (a)  Each  member  shall  receive  regular credit for all
service as a teacher from the  date  membership  begins,  for
which satisfactory evidence is supplied and all contributions
have been paid.
    (b)  The following periods of service shall earn optional
credit  and  each  member  shall  receive credit for all such
service for which satisfactory evidence is supplied  and  all
contributions have been paid as of the date specified:
         (1)  Prior service as a teacher.
         (2)  Service  in  a  capacity essentially similar or
    equivalent to that of a teacher,  in  the  public  common
    schools  in  school  districts in this State not included
    within the provisions of this System,  or  of  any  other
    State,  territory, dependency or possession of the United
    States, or in schools operated by or under  the  auspices
    of the United States, or under the auspices of any agency
    or  department of any other State, and service during any
    period  of  professional  speech  correction  or  special
    education experience for  a  public  agency  within  this
    State  or  any  other  State,  territory,  dependency  or
    possession  of  the  United  States, and service prior to
    February 1, 1951 as a recreation worker for the  Illinois
    Department  of  Public Safety, for a period not exceeding
    the lesser of 2/5 of the total creditable service of  the
    member  or  10  years.   The  maximum service of 10 years
    which is allowable under this paragraph shall be  reduced
    by  the  service  credit  which  is  validated  by  other
    retirement  systems under paragraph (i) of Section 15-113
    and paragraph 1 of Section 17-133.  Credit granted  under
    this  paragraph  may  not  be  used in determination of a
    retirement annuity  or  disability  benefits  unless  the
    member  has at least 5 years of creditable service earned
    subsequent to this employment with one  or  more  of  the
    following  systems:  Teachers'  Retirement  System of the
    State of Illinois, State Universities Retirement  System,
    and  the  Public  School Teachers' Pension and Retirement
    Fund of Chicago.  Whenever such  service  credit  exceeds
    the maximum allowed for all purposes of this Article, the
    first   service  rendered  in  point  of  time  shall  be
    considered. The changes to this subdivision  (b)(2)  made
    by  Public Act 86-272 shall apply not only to persons who
    on or after its effective date (August 23, 1989)  are  in
    service  as  a  teacher  under  the  System,  but also to
    persons whose status as such a teacher  terminated  prior
    to  such effective date, whether or not such person is an
    annuitant on that date.
         (3)  Any  periods  immediately  following   teaching
    service,  under  this  System  or  under  Article 17, (or
    immediately following service prior to February  1,  1951
    as  a  recreation  worker  for the Illinois Department of
    Public Safety) spent in active service with the  military
    forces of the United States; periods spent in educational
    programs that prepare for return to teaching sponsored by
    the  federal  government  following  such active military
    service; if a teacher returns to teaching service  within
    one calendar year after discharge or after the completion
    of   the  educational  program,  a  further  period,  not
    exceeding  one  calendar  year,  between  time  spent  in
    military service or in such educational programs and  the
    return  to employment as a teacher under this System; and
    a period of up to 2 years of active military service  not
    immediately following employment as a teacher.
         The  changes  to  this  Section  and  Section 16-128
    relating to military service made by  P.A.  87-794  shall
    apply  not  only to persons who on or after its effective
    date are in service as a teacher under  the  System,  but
    also  to  persons  whose  status  as a teacher terminated
    prior to that date, whether  or  not  the  person  is  an
    annuitant  on that date.  In the case of an annuitant who
    applies for credit allowable under  this  Section  for  a
    period  of  military  service  that  did  not immediately
    follow  employment,  and  who  has  made   the   required
    contributions  for  such  credit,  the  annuity  shall be
    recalculated to include the  additional  service  credit,
    with  the  increase  taking effect on the date the System
    received written notification of the  annuitant's  intent
    to  purchase  the  credit, if payment of all the required
    contributions is made within 60 days of such  notice,  or
    else on the first annuity payment date following the date
    of payment of the required contributions.  In calculating
    the  automatic  annual  increase  for an annuity that has
    been recalculated  under    this  Section,  the  increase
    attributable  to  the  additional service allowable under
    P.A. 87-794 shall  be  included  in  the  calculation  of
    automatic  annual  increases accruing after the effective
    date of the recalculation.
         Credit for military service shall be  determined  as
    follows:  if  entry  occurs  during  the  months of July,
    August, or September and the member was a teacher at  the
    end  of  the  immediately  preceding  school term, credit
    shall be granted from July 1 of the year in which  he  or
    she  entered  service;  if entry occurs during the school
    term and the teacher  was  in  teaching  service  at  the
    beginning  of  the  school  term, credit shall be granted
    from July 1 of such year. In all other cases where credit
    for military service is allowed, credit shall be  granted
    from the date of entry into the service.
         The  total  period  of  military  service  for which
    credit is granted shall not exceed 5 years for any member
    unless the service:  (A)  is  validated  before  July  1,
    1964,  and  (B)  does  not  extend  beyond  July 1, 1963.
    Credit for military service shall be granted  under  this
    Section  only  if  not  more than 5 years of the military
    service for which credit is granted under this Section is
    used by the member to qualify for a  military  retirement
    allotment  from  any  branch  of  the armed forces of the
    United States. The changes  to  this  subdivision  (b)(3)
    made by Public Act 86-272 shall apply not only to persons
    who  on or after its effective date (August 23, 1989) are
    in service as a teacher under the  System,  but  also  to
    persons  whose  status as such a teacher terminated prior
    to such effective date, whether or not such person is  an
    annuitant on that date.
         (4)  Any  periods  served as a member of the General
    Assembly.
         (5)(i)  Any periods for which a teacher, as  defined
    in  Section  16-106,  is  granted  a  leave  of  absence,
    provided he or she returns to teaching service creditable
    under  this  System  or the State Universities Retirement
    System following the leave; (ii) periods during  which  a
    teacher is involuntarily laid off from teaching, provided
    he  or she returns to teaching following the lay-off; and
    (iii) periods prior  to  July  1,  1983  during  which  a
    teacher  ceased  covered  employment  due  to  pregnancy,
    provided  that  the  teacher returned to teaching service
    creditable under this System or  the  State  Universities
    Retirement  System  following  the  pregnancy and submits
    evidence satisfactory to the Board documenting  that  the
    employment  ceased  due  to  pregnancy;  and (iv) periods
    prior to July 1,  1983  during  which  a  teacher  ceased
    covered  employment for the purpose of adopting an infant
    under 3 years of age or caring for a newly adopted infant
    under 3 years of age, provided that the teacher  returned
    to  teaching  service creditable under this System or the
    State  Universities  Retirement  System   following   the
    adoption  and  submits evidence satisfactory to the Board
    documenting that the employment ceased for the purpose of
    adopting an infant under 3 years of age or caring  for  a
    newly  adopted  infant  under  3  years of age.  However,
    total credit under this paragraph (5) may  not  exceed  3
    years.
         Any  qualified  member  or  annuitant  may apply for
    credit under item (iii) or (iv)  of  this  paragraph  (5)
    without  regard  to whether service was terminated before
    the effective date of this amendatory Act of  1997  1995.
    In  the case of an annuitant who establishes credit under
    item (iii) or (iv), the annuity shall be recalculated  to
    include  the  additional service credit.  The increase in
    annuity shall take effect on the date the System receives
    written  notification  of  the  annuitant's   intent   to
    purchase   the   credit,  if  the  required  evidence  is
    submitted and the required contribution  paid  within  60
    days of that notification, otherwise on the first annuity
    payment  date  following  the  System's  receipt  of  the
    required  evidence  and contribution.  The increase in an
    annuity  recalculated  under  this  provision  shall   be
    included in the calculation of automatic annual increases
    in  the  annuity accruing after the effective date of the
    recalculation.
         Optional  credit  may  be   purchased   under   this
    subsection  (b)(5) for periods during which a teacher has
    been granted a leave of absence pursuant to Section 24-13
    of the School Code.  A teacher whose service  under  this
    Article  terminated  prior  to the effective date of P.A.
    86-1488 shall  be  eligible  to  purchase  such  optional
    credit.   If a teacher who purchases this optional credit
    is already receiving  a  retirement  annuity  under  this
    Article,  the  annuity  shall  be  recalculated as if the
    annuitant had applied for the leave of absence credit  at
    the  time  of  retirement.   The  difference  between the
    entitled annuity and the actual annuity shall be credited
    to the purchase of the optional credit.  The remainder of
    the purchase cost of the optional credit shall be paid on
    or before April 1, 1992.
         The change in this  paragraph  made  by  Public  Act
    86-273  shall  be applicable to teachers who retire after
    June 1, 1989, as well as to teachers who are  in  service
    on that date.
         (6)  Any    days   of   unused   and   uncompensated
    accumulated sick leave earned by a teacher.  The  service
    credit granted under this paragraph shall be the ratio of
    the  number  of unused and uncompensated accumulated sick
    leave days to 170 days, subject to a maximum of one  year
    of  service  credit.   Prior  to the member's retirement,
    each former employer shall  certify  to  the  System  the
    number of unused and uncompensated accumulated sick leave
    days credited to the member at the time of termination of
    service.  The  period  of  unused sick leave shall not be
    considered  in  determining   the   effective   date   of
    retirement.    A   member   is   not   required  to  make
    contributions in  order  to  obtain  service  credit  for
    unused sick leave.
         Credit  for  sick  leave  shall,  at  retirement, be
    granted by  the  System  for  any  retiring  regional  or
    assistant  regional superintendent of schools at the rate
    of 6 days per  year  of  creditable  service  or  portion
    thereof  established while serving as such superintendent
    or assistant superintendent.
         (7)  Periods prior to February 1, 1987 served as  an
    employee  of the Illinois Mathematics and Science Academy
    for which credit has not been  terminated  under  Section
    15-113.9 of this Code.
         (8)  Service   as  a  substitute  teacher  for  work
    performed prior to July 1, 1990.
         (9)  Service  as  a  part-time  teacher   for   work
    performed prior to July 1, 1990.
         (10)  Up  to  2  years  of  employment with Southern
    Illinois University - Carbondale from September  1,  1959
    to  August  31,  1961, or with Governors State University
    from September 1, 1972 to August 31, 1974, for which  the
    teacher  has  no  credit  under  Article  15.  To receive
    credit under this item (10),  a  teacher  must  apply  in
    writing  to  the Board and pay the required contributions
    before May 1, 1993 and have at least 12 years of  service
    credit under this Article.
    (c)  The  service credits specified in this Section shall
be granted only if:  (1) such service credits  are  not  used
for  credit  in  any  other  statutory  tax-supported  public
employee  retirement  system  other  than  the federal Social
Security program; and  (2)  the  member  makes  the  required
contributions  as  specified  in Section 16-128.  The service
credit shall  be  effective  as  of  the  date  the  required
contributions are completed.
    Any  service  credits  granted  under  this Section shall
terminate upon cessation of membership for any cause.
    Credit may not be granted under this Section covering any
period for which an age retirement or  disability  retirement
allowance has been paid.
(Source: P.A. 88-45; 89-430, eff. 12-15-95.)

    (40 ILCS 5/16-141) (from Ch. 108 1/2, par. 16-141)
    Sec. 16-141.  Survivors' benefits - death in service.
    (a)  Upon  the  death of a member in service occurring on
or after July 1, 1990, a beneficiary designated by the member
shall be entitled to receive,  in  a  single  sum,  for  each
completed  year  of  service  up  to a maximum of 6 years, an
amount equal to 1/6 of the  member's  highest  annual  salary
rate  within  the  last  4 years of service.  If death occurs
prior to  completion  of  the  first  year  of  service,  the
beneficiary  shall  be  entitled to receive, in a single sum,
an amount equal to 1/6 of the most recent annual salary rate.
If no beneficiary is  designated  by  the  member  or  if  no
designated  beneficiary  survives  the member, the single sum
benefit under this paragraph shall be paid  to  the  eligible
dependent  beneficiary  or  to the trust established for such
eligible dependent beneficiary, as determined under paragraph
(3)  of  Section  16-140,  or,  if  there  is  no   dependent
beneficiary,  to the decedent's estate upon receipt of proper
proof of death.
    (b)  If the deceased member had at  least  1.5  years  of
creditable   service,  had  rendered  at  least  60  days  of
creditable service within the 18 months immediately preceding
death and had not designated a non-dependent beneficiary  who
survives,  a  dependent  beneficiary  may  elect  to receive,
instead of the benefit under subsection (a) of this  Section,
a single sum payment of $1,000, divided by the number of such
beneficiaries,   together   with   a  survivor's  benefit  as
specified under the following paragraphs:
         (1)  A surviving spouse,  if  no  eligible  children
    exist,  shall  receive  a  survivor's  benefit  of 30% of
    average salary, beginning at age 50 or upon the  date  of
    the  member's  death,  whichever is later, except that if
    the member's death occurred before July 1, 1973  and  the
    surviving  spouse  is  less  than age 55 on the effective
    date of this  amendatory  Act  of  1997,  the  survivor's
    benefit  shall  begin  on  the  effective  date  of  this
    amendatory  Act  of  1997  or upon the surviving spouse's
    attainment of age 50, whichever occurs later at age 55.
         (2)  A surviving spouse, regardless of age,  who  is
    providing  for  the  support  of  the  deceased  member's
    eligible child, shall receive a survivor's benefit of 30%
    of  average  salary,  plus  the sum of (A) 20% of average
    salary on account of each dependent child, and (B) 10% of
    average salary divided by the number of children entitled
    to this benefit.
         (3)  Each eligible child, if there  is  no  eligible
    surviving  spouse,  shall  receive  upon the death of the
    member a survivor's benefit equal to the sum of: (A)  20%
    of  average salary, and (B) 10% of average salary divided
    by the number of children entitled to this benefit.
         (4)  A   dependent   parent   shall   receive   upon
    attainment of age 55 or the date of the  member's  death,
    whichever  is  later,  a  survivor's  benefit  of  30% of
    average  salary,  unless  dependency  is  terminated   by
    remarriage or otherwise.
    (c)  No  election  under  this  Section  may be made by a
dependent  beneficiary   if   a   non-dependent   beneficiary
designated by the member survives such member.
    (d)  Notwithstanding   the   other   provisions  of  this
Section, if the member is in receipt of a benefit at the time
of his or her death, a dependent beneficiary shall receive  a
survivor  benefit  beginning the first of the month following
the death of the member.
    (e)  In cases  where  the  changes  to  this  Section  or
Section 16-142 made by Public Act 87-1265 this amendatory Act
of  1993  increase  the  amount of a single-sum death benefit
that has already been paid by the System,  the  System  shall
pay to the beneficiary the amount of the increase provided by
this amendatory Act.
(Source: P.A. 86-273; 87-1265.)

    (40 ILCS 5/17-106) (from Ch. 108 1/2, par. 17-106)
    Sec.    17-106.    Contributor,    member   or   teacher.
"Contributor", "member" or "teacher":   All  members  of  the
teaching  force  of the city, including principals, assistant
principals, the general  superintendent  of  schools,  deputy
superintendents  of  schools,  associate  superintendents  of
schools,  assistant  and district superintendents of schools,
members of the Board of Examiners, all  other  persons  whose
employment  requires  a  teaching  certificate  issued by the
Board  of   Examiners,   any   educational,   administrative,
professional,  or  other  staff  employed in a charter school
operating in compliance with the Charter Schools Law  who  is
certified  under  the  law  governing  the  certification  of
teachers,  and  employees  of  the  Board  of  Trustees,  but
excluding  persons  contributing  concurrently  to  any other
public employee  pension  system  in  Illinois  or  receiving
retirement  pensions  under  another  Article  of  this  Code
(unless the person's eligibility to participate in that other
pension  system arises from the holding of an elective public
office, and the person has held that  public  office  for  at
least  10  years),  persons  employed on an hourly basis, and
persons receiving pensions from the  fund  who  are  employed
temporarily by the Board of Education for 100 75 days or less
in any school year and not on an annual basis.
    In the case of a person who has been making contributions
and  otherwise  participating  in  this  Fund  prior  to  the
effective  date  of  this  amendatory  Act of 1991, and whose
right to participate in the Fund is established or  confirmed
by this amendatory Act, such prior participation in the Fund,
including  all  contributions  previously  made  and  service
credits   previously   earned   by  the  person,  are  hereby
validated.

    (40 ILCS 5/17-115) (from Ch. 108 1/2, par. 17-115)
    Sec. 17-115.  Eligibility for service retirement pension.
    (a)  The Board shall  find  a  contributor  eligible  for
service retirement pension when he has:
         (1)   1.  Left   the  employment  of  the  Board  of
    Education or the board after completing 5 or  more  years
    of service, or has been retired compulsorily as a regular
    teacher because of age.
         (2)  2.  Contributed  to  the  fund  the  total sums
    provided in this Article.
         (3) 3.  Contributed as  a  member  of  the  teaching
    force  in  the public schools of the City or to the State
    Universities  Retirement  System  or  to  the   Teachers'
    Retirement  System  of  the  State of Illinois during the
    last 5 years of his term of service.
         (4) 4.  Filed a written application for pension.
    (b)  In computing the years of service for which  annuity
is granted, the following conditions shall apply:
         (1) 1.  No more than 10 years of teaching service in
    public  schools  of  the  several  states  or  in schools
    operated by or under the auspices of  the  United  States
    shall  be  allowed.  This maximum shall be reduced by the
    service credit which is validated under paragraph (i)  of
    Section  15-113  and  paragraph  (3) of Section 16-127 of
    this Code. Three-fifths of the term of service for  which
    an  annuity  is  granted  shall have been rendered in the
    public schools of  the  city.  No  portion  of  any  such
    service  shall be included in the total period of service
    for which a pension is payable  or  paid  by  some  other
    public  retirement  system;  provided that this shall not
    apply to any benefit payable  only  after  the  teacher's
    death or to any compensation or annuity paid by the Board
    of Education after retirement from active service.
         (2)  2.  Up  to  No  more  than  5 years of military
    active service, if preceded by service as a teacher under
    this fund or under Article 16, shall be included  in  the
    total  period  of service even though it can otherwise be
    used in the computation of a  pension  or  other  benefit
    provided for service in any branch of the armed forces of
    the United States.
(Source:  P.A. 83-803.)

    (40 ILCS 5/17-116.1) (from Ch. 108 1/2, par. 17-116.1)
    Sec. 17-116.1.  Early retirement without discount.
    (a)  A member retiring after June 1, 1980 and before June
30,  1995 and within 6 months of the last day of teaching for
which retirement contributions were required,  may  elect  at
the   time  of  application  to  make  a  one  time  employee
contribution to  the  system  and  thereby  avoid  the  early
retirement  reduction in allowance specified in paragraph (4)
of Section 17-116 of  this  Article.   The  exercise  of  the
election  shall obligate the employer to also make a one time
non-refundable contribution to the fund.
    (b)  Subject to authorization by the employer as provided
in subsection (c), a member retiring on  or  after  June  30,
1995  and  on  or before June 30, 2000 and within 6 months of
the last day of teaching for which  retirement  contributions
were  required may elect at the time of application to make a
one-time employee contribution to the Fund and thereby  avoid
the  early  retirement  reduction  in  allowance specified in
paragraph  (4)  of  Section  17-116.   The  exercise  of  the
election shall obligate the employer to also make a  one-time
nonrefundable contribution to the Fund.
    (c)  The   benefits   provided   in  subsection  (b)  are
available only to members  who  retire,  during  a  specified
period, from employment with an employer that has adopted and
filed  with  the  board  of  the  Fund a resolution expressly
providing for the creation of  an  early  retirement  without
discount program under this Section for that period.
    The  employer  has  the  full discretion and authority to
determine  whether  an  early  retirement  without   discount
program is in its best interest and to provide such a program
to  its  eligible  employees in accordance with this Section.
The employer may decide to authorize such a program  for  one
or  more  of the following periods:  for the period beginning
July 1, 1997 and ending June 30,  1998,  in  which  case  the
resolution must be adopted by January 1, 1998; for the period
beginning  July  1,  1998  and ending June 30, 1999, in which
case the resolution must be adopted by March  31,  1998;  and
for  the  period  beginning  July 1, 1999 and ending June 30,
2000, in which case the resolution must be adopted  by  March
31, 1999.  The resolution must be filed with the board of the
Fund within 10 days after it is adopted.  A single resolution
may authorize an early retirement without discount program as
provided in this Section for more than one period.
    Notwithstanding  Section  17-157, the employer shall also
have full discretion and authority to  determine  whether  to
allow  its  employees  who  withdrew from service on or after
June  30,  1995  and  before  the  effective  date  of   this
amendatory  Act of 1997 to participate in an early retirement
without discount program  under  subsection  (b).   An  early
retirement  without  discount  program for those who withdrew
from service on  or  after  June  30,  1995  and  before  the
effective  date  of  this  amendatory  Act  of  1997  may  be
authorized  only  by  a  resolution  of  the employer that is
adopted by January 1, 1998 and filed with the  board  of  the
Fund within 10 days after its adoption.  If such a resolution
is  duly  adopted  and  filed, a person who (i) withdrew from
service with the employer on  or  after  June  30,  1995  and
before  the  effective  date  of this amendatory Act of 1997,
(ii) qualifies for early retirement  without  discount  under
subsection  (b),  (iii)  applies  to  the Fund within 90 days
after the authorizing resolution is adopted,  and  (iv)  pays
the  required  employee  contribution  shall  have his or her
retirement pension recalculated in accordance with subsection
(b).  The resulting increase shall be effective retroactively
to the starting date of the retirement pension.
    (d)  The one-time employee contribution shall be equal to
7% of the retiring member's highest full-time  annual  salary
rate used in the determination of the average salary rate for
retirement  pension,  or  if not full-time then the full-time
equivalent, multiplied by (1) the number of years the teacher
is under age 60, or (2) the number of  years  the  employee's
creditable  service is less than 35 years, whichever is less.
The  employer  contribution  shall  be  20%  of  such  salary
multiplied by such number of years.
    (e)  Upon receipt of the application  and  election,  the
board  shall  determine  the  one  time employee and employer
contributions.  The provisions of this Section shall  not  be
applicable  until  all  the above outlined contributions have
been  received  by  the  fund;   however,   the   date   such
contributions   are  received  shall  not  be  considered  in
determining the effective date of retirement.
    (f)  The number of employees who may  retire  under  this
Section  in  any  year  may  be  limited at the option of the
employer to a specified percentage  of  those  eligible,  not
lower than 30%, with the right to participate to be allocated
among those applying on the basis of seniority in the service
of the employer.
(Source: P.A. 86-272.)

    (40 ILCS 5/17-117) (from Ch. 108 1/2, par. 17-117)
    Sec. 17-117. Disability retirement pension.
    (a)  The  conditions  prescribed  in  items  1  and  2 in
Section 17-116  for  computing  service  retirement  pensions
shall  apply  in  the  computation  of  disability retirement
pensions.
         (1) 1.  Each teacher retired or  retiring  after  10
    years  of  service and with less than 20 years of service
    because  of  permanent  disability  not  incurred  as   a
    proximate result of the performance of duty shall receive
    a  disability  retirement  pension  equal  to  1  2/3% of
    average salary for each year of service.
         (2) 2.  If the total service is 20  years  and  less
    than  25  years  and  the  teacher's age is under 55, the
    disability  retirement  pension  shall  equal  a  service
    retirement pension discounted 1/2 of 1%  for  each  month
    the  age  of  the  contributor  is less than 55 down to a
    minimum  age  of  50  years,  provided   the   disability
    retirement pension so computed shall not be less than the
    amount payable under paragraph 1.
         (3) 3.  If the total service is 20 years or more and
    the  teacher  has attained age 55, and is under age 60, a
    disability  retirement  pension  shall  equal  a  service
    retirement pension without discount.
         (4) 4.  If the total service is  25  years  or  more
    regardless  of  age,  a  disability pension shall equal a
    service retirement pension without discount.
         (5) 5.  If the total service is 20 years or more and
    the teacher is age  60  or  over,  a  service  retirement
    pension shall be payable.
    (b)  For  disability  retirement  pensions, the following
further conditions shall apply:
         (1)  1.  Written  application  shall  be   submitted
    within 3 years from the date of separation.
         (2) 2.  The applicant shall submit to examination by
    physicians  appointed  by  the board within one year from
    the date of their appointment.
         (3) 3.  Two  physicians,  appointed  by  the  board,
    shall  declare  the  applicant  to  be  suffering  from a
    disability  which  wholly  and   presumably   permanently
    incapacitates  him  for  teaching  or  for  service as an
    employee of the board.  In the event of  disagreement  by
    the  physicians,  a  third  physician,  appointed  by the
    board, shall declare the applicant wholly and  presumably
    permanently incapacitated.
    (c)  Disability  retirement  pensions  shall begin on the
effective date of resignation or the day following the  close
of  the  payroll  period  for  which  credit  was  validated,
whichever is later.
(Source: P.A. 86-1488.)

    (40 ILCS 5/17-117.1) (from Ch. 108 1/2, par. 17-117.1)
    Sec.  17-117.1.  Duty  disability.  A teacher who becomes
wholly and presumably permanently totally  incapacitated  for
duty  while  under age 65 as the proximate result of injuries
sustained  or  a  hazardous  condition  encountered  in   the
performance  and  within  the  scope  of  his duties, if such
injury or hazard was not the result of  his  own  negligence,
shall be entitled to a duty disability benefit, provided:
         (1)  application  for  the  benefit  is  made to the
    Board not more than 6 months after a final settlement  or
    an  award  from  the  Industrial  Commission  or within 6
    months of the manifestation of an injury or illness  that
    can  be traced directly to an injury or illness for which
    a claim was filed  with  the  Industrial  Commission  the
    occurrence  of an injury disability or 6 months after the
    occurrence of disablement if an occupational disease;
         (2)  certification  is  received  from  2  or   more
    physicians  designated  by  the board that the teacher is
    physically incapacitated for teaching service; and
         (3)  the teacher provides the Board with a  copy  of
    the  notice  of  the  occurrence  that was filed with the
    Board of  Education  within  the  time  provided  by  law
    resulting in disability is filed with the board within 90
    days of the date thereof.
    The  benefit shall be payable during disability and shall
be 75% of the salary in effect at date of disability, payable
until the teacher's attainment of age 65.  At  such  time  if
disability still exists, the teacher shall become entitled to
a service retirement pension. Creditable service shall accrue
during the period the disability benefit is payable.
    Before any action is taken by the board on an application
for a duty disability benefit, the teacher shall file a claim
with   the   Industrial  Commission  to  establish  that  the
disability was incurred while the teacher was  acting  within
the  scope of and in the course of his duties under the terms
of the Workers' Compensation or Occupational  Diseases  Acts,
whichever  may  be  applicable.  The benefit shall be payable
after  a  finding  by  the  Commission  that  the  claim  was
compensable under either of the aforesaid Acts; but  if  such
finding  is  appealed  the benefit shall be payable only upon
affirmance of the Commission's finding. After the teacher has
made  timely  application  for  a  duty  disability   benefit
supported  by  the  certificate of two or more physicians, he
shall be entitled to a disability retirement pension provided
in Section  17-117  of  this  Act  until  such  time  as  the
Industrial  Commission  award  finding that his disability is
duty-connected as provided in this Section becomes final.
    Any amounts provided for  the  teacher  under  such  Acts
shall  be applied as an offset to the duty disability benefit
payable hereunder in such manner as may be prescribed by  the
rules of the board.
(Source: P.A. 81-992.)

    (40 ILCS 5/17-120) (from Ch. 108 1/2, par. 17-120)
    Sec.  17-120.  Reversionary pension.  Any contributor, at
any time prior to retirement on a service retirement pension,
may exercise an option of taking a lesser amount  of  service
retirement  pension  and  providing with the remainder of his
equity,  determined  on  an  actuarial  equivalent  basis,  a
reversionary pension  benefit  for  any  person  named  in  a
written  designation filed by the contributor with the board,
provided that the pension resulting from such election is not
less than $40 per month, or more  than  the  reduced  pension
payable  after  the  exercise  of the option.  If the reduced
pension to the retired teacher is less than that provided for
a beneficiary, whether or not the aforesaid minimum amount is
payable, the election shall be void.
    The pension to a beneficiary shall begin on the first day
of the month next following the month in  which  the  retired
teacher dies.
    If the beneficiary survives the date of retirement of the
teacher,  but  does  not  survive  the  retired  teacher,  no
reversionary  pensions  shall be payable, and no change shall
be made in the rate of  pension  granted  previously  to  the
retired teacher if the reversionary annuity was elected prior
to  January 1, 1984.  If the reversionary annuity was elected
on or after January 1, 1984 and the beneficiary survives  the
date  of  retirement of the teacher, but does not survive the
retired teacher,  the  teacher's  service  pension  shall  be
restored  to the full service pension amount beginning on the
first day of the month next following the month in which  the
beneficiary  dies or on the effective date of this amendatory
Act of 1997, whichever occurs later, provided that the  Board
adopts   actuarial   factors   that  take  into  account  the
additional cost involved.
    If the beneficiary  dies  after  the  such  election  but
before  the  retirement of the teacher, the election shall be
void.   No  change  shall  be  permitted   in   the   written
designation filed with the board.
    In the case of a reversionary annuity elected on or after
January 1, 1984, no reversionary annuity shall be paid if the
teacher  dies before the expiration of 730 days from the date
that a written designation was filed  with  the  board,  even
though the teacher was receiving a reduced annuity.
    Sections  1-103.1  and 17-157 do not apply to the changes
made to this Section by this amendatory Act of 1997.
(Source: P.A. 83-812.)

    (40 ILCS 5/17-122) (from Ch. 108 1/2, par. 17-122)
    Sec. 17-122. Survivor's and children's pensions - Amount.
Upon the death of a teacher who has completed at least 1  1/2
years  of  contributing  service with either this Fund or the
State  Universities  Retirement  System  or   the   Teachers'
Retirement  System  of  the  State  of Illinois, provided his
death occurred while (a) in active  service  covered  by  the
fund  or  during his first 18 months of continuous employment
without a break in  service  under  any  other  participating
system   as   defined  in  the  Illinois  Retirement  Systems
Reciprocal  Act  except  the  State  Universities  Retirement
System and the Teachers' Retirement System of  the  State  of
Illinois,  (b)  on  a  creditable  leave of absence, (c) on a
noncreditable leave of absence of no more than one  year,  or
(d)  a  pension  was deferred or pending provided the teacher
had at least 10 years of validated service  credit,  or  upon
the  death  of  a  pensioner  otherwise  qualified  for  such
benefit, the surviving spouse and unmarried minor children of
the  deceased  teacher  under  age  18  shall  be entitled to
pensions, under  the  conditions  stated  hereinafter.   Such
survivor's  and  children's  pensions  shall  be based on the
average of the 4 highest consecutive years of salary  in  the
last  10  years of service or on the average salary for total
service, if  total  service  has  been  less  than  4  years,
according to the following percentages:
    30%  of  average  salary or 50% of the retirement pension
earned by the teacher, whichever is larger,  subject  to  the
prescribed  maximum  monthly  payment, for a surviving spouse
alone on attainment of age 50;
    60%  of  average  salary  for  a  surviving  spouse   and
eligible minor children of the deceased teacher.
    If  no  eligible spouse survives, or the surviving spouse
remarries, or the parent of  the  children  of  the  deceased
member  is  otherwise  ineligible for a survivor's pension, a
children's pension for eligible minor children under  age  18
shall  be  paid  to  their parent or legal guardian for their
benefit according to the following percentages:
    30% of average salary for one child;
    60% of average salary for 2 or more children.
    On January  1,  1981,  any  survivor  or  child  who  was
receiving  a  survivor's  or  children's pension on or before
January 1, 1971, shall  have  his  survivor's  or  children's
pension  then  being  paid increased by 1% for each full year
which has elapsed from the date the pension began. On January
1, 1982, any survivor or  child  whose  pension  began  after
January  1,  1971, but before January 1, 1981, shall have his
survivor's or children's pension then being paid increased 1%
for each full year  which  has  elapsed  from  the  date  the
pension  began.  On  January  1,  1987, any survivor or child
whose pension began on or before January 1, 1977, shall  have
the  monthly survivor's or children's pension increased by $1
for each full year which has elapsed since the pension began.
    Beginning  January  1,   1990,   every   survivor's   and
children's  pension  shall be increased (1) on each January 1
occurring on or after the commencement of the pension if  the
deceased  teacher  died while receiving a retirement pension,
or (2) in other cases, on each  January  1  occurring  on  or
after  the  first  anniversary  of  the  commencement  of the
pension, by an amount equal to 3% of the  current  amount  of
the pension, including all increases previously granted under
this Article, notwithstanding Section 17-157.  Such increases
shall  apply  without  regard to whether the deceased teacher
was in service  on  or  after  the  effective  date  of  this
amendatory  Act  of 1991, but shall not accrue for any period
prior to January 1, 1990.
    Subject to the minimum  established  below,  the  maximum
amount  of  pension for a surviving spouse alone or one minor
child shall be $400  per  month,  and  the  maximum  combined
pensions  for a surviving spouse and children of the deceased
teacher shall be $600 per  month,  with  individual  pensions
adjusted  for all beneficiaries pro rata to conform with this
limitation.   If  proration  is   unnecessary   the   minimum
survivor's  and  children's  pensions shall be $40 per month.
The minimum total survivor's and children's  pension  payable
upon  the  death  of  a contributor or annuitant which occurs
after  December  31,  1986,  shall  be  50%  of  the   earned
retirement   pension   of   such  contributor  or  annuitant,
calculated without early retirement discount in the  case  of
death in service.
    On  death  after  retirement,  the  total  survivor's and
children's pensions shall not exceed the  monthly  retirement
or   disability   pension  paid  to  the  deceased  retirant.
Survivor's and children's benefits described in this  Section
shall apply to all service and disability pensioners eligible
for a pension as of July 1, 1981.
(Source: P.A. 86-273; 86-1488.)

    (40 ILCS 5/17-134) (from Ch. 108 1/2, par. 17-134)
    Sec.   17-134.   Contributions  for  leaves  of  absence;
military service; computing service.   In  computing  service
for  pension  purposes the following periods of service shall
stand in lieu of a like number of years of  teaching  service
upon payment therefor in the manner hereinafter provided: (a)
time  spent  on  sabbatical leaves of absence, sick leaves or
maternity or paternity leaves; (b) service  with  teacher  or
labor  organizations  based  upon  special  leaves of absence
therefor granted by the Board of Education; (c) a maximum  of
5  years  spent in the military service of the United States,
of which up to 2 years  may  have  been  served  outside  the
pension  period;  (d)  unused  sick  days  at  termination of
service to a maximum of 244 days; (e) time lost due to layoff
and curtailment of the school term from June 6  through  June
21,  1976; and (f) time spent after June 30, 1982 as a member
of the Board of Education, if  required  to  resign  from  an
administrative or teaching  position in order to qualify as a
member of the Board of Education.
         (1) 1.  For time spent on or after September 6, 1948
    on sabbatical leaves of absence or sick leaves, for which
    salaries  are  paid,  the  Board  of Education shall make
    payroll deductions at  the  applicable  rates  in  effect
    during such periods.
         (2)  2.  For time spent on sabbatical or sick leaves
    commencing on or after September 1, 1961,  and  for  time
    spent  on  maternity  or  paternity  leaves, for which no
    salaries are  paid,  teachers  desiring  credit  therefor
    shall  pay  the  required  contributions  at the rates in
    effect  during  such  periods  as  though  they  were  in
    teaching service. If the Board of Education  pays  salary
    for  vacations  which occur during a teacher's sick leave
    or maternity or paternity leave without salary,  vacation
    pay  for  which the teacher would have qualified while in
    active service shall be considered part of the  teacher's
    total salary for pension purposes. No more than 12 months
    of  sick leave or maternity or paternity leave credit may
    be allowed any person during the entire term of  service.
    Sabbatical  leave credit shall be limited to the time the
    person on leave without salary under Board  of  Education
    rules  is  allowed  to engage in an activity for which he
    receives salary or compensation.
         (3) 3.  For time spent prior to September  6,  1948,
    on  sabbatical leaves of absence or sick leaves for which
    salaries were  paid,  teachers  desiring  service  credit
    therefor  shall  pay  the  required  contributions at the
    maximum applicable rates in effect during such periods.
         (4)  4.  For   service   with   teacher   or   labor
    organizations  authorized  by  special leaves of absence,
    for which no payroll deductions are made by the Board  of
    Education,  teachers  desiring  service  credit  therefor
    shall contribute to the fund upon the basis of the actual
    salary received from such organizations at the percentage
    rates   in  effect  during  such  periods  for  certified
    positions with the Board of Education.  To the extent the
    actual salary exceeds the regular salary, which shall  be
    defined as the salary rate, as calculated by the board of
    trustees, in effect for the teacher's regular position in
    teaching service on September 1, 1983 or on the effective
    date  of  the  leave  with the organization, whichever is
    later,  the  organization  shall  pay  to  the  fund  the
    employer's normal cost as set by the board of trustees on
    the increment.
         (5) 5.  For time  spent  in  the  military  service,
    teachers  entitled  to and desiring credit therefor shall
    contribute the amount required for each year  of  service
    or fraction thereof at the rates in force (a) at the date
    of appointment, or (b) on return to teaching service as a
    regularly certified teacher, as the case may be; provided
    such  rates  shall  not  be  less  than  $450 per year of
    service.  These conditions shall apply unless  the  Board
    of  Education  elects  to  and does pay into the fund the
    amount which would have been due from such person had  he
    been employed as a teacher during such time.  In the case
    of  credit  for  military  service not during the pension
    period, the teacher must also pay to the Fund  an  amount
    determined  by  the  board  to be equal to the employer's
    normal cost of the benefits accrued  from  such  service,
    plus   interest   thereon  at  5%  per  year,  compounded
    annually, from the date of appointment conclusion of  the
    military service to the date of payment.
         The  changes  to  this  Section  made  by Public Act
    87-795 this amendatory Act of 1991 shall apply  not  only
    to  persons  who  on  or  after its effective date are in
    service under the Fund, but also to persons whose  status
    as  a  teacher  terminated prior to that date, whether or
    not the person is an annuitant on that date.  In the case
    of an annuitant who applies for  credit  allowable  under
    this  Section  for  a period of military service that did
    not immediately follow employment, and who has  made  the
    required contributions for such credit, the annuity shall
    be recalculated to include the additional service credit,
    with  the  increase  taking  effect  on the date the Fund
    received written notification of the  annuitant's  intent
    to  purchase  the  credit, if payment of all the required
    contributions is made within 60 days of such  notice,  or
    else on the first annuity payment date following the date
    of payment of the required contributions.  In calculating
    the  automatic  annual  increase  for an annuity that has
    been  recalculated  under  this  Section,  the   increase
    attributable  to  the  additional service allowable under
    this amendatory Act of 1991  shall  be  included  in  the
    calculation  of automatic annual increases accruing after
    the effective date of the recalculation.
         The total credit  for  military  service  shall  not
    exceed  5  years,  except that any teacher who on July 1,
    1963, had validated credit  for  more  than  5  years  of
    military service shall be entitled to the total amount of
    such credit.
         (6)  6.  A  maximum of 244 unused sick days credited
    to his account by the Board of Education on the  date  of
    termination of employment.  Members, upon verification of
    unused  sick  days,  may  add  this service time to total
    creditable service.
         (7) 7.  In all cases where time spent  on  leave  is
    creditable and no payroll deductions therefor are made by
    the  Board  of Education, persons desiring service credit
    shall make the required  contributions  directly  to  the
    fund.
         (8)  8.  For time lost without pay due to layoff and
    curtailment of the school term from June 6  through  June
    21,  1976, as provided in item (e) of the first paragraph
    of this Section, persons who  were  contributors  on  the
    days  immediately  preceding  such  layoff  shall receive
    credit upon paying to the Fund a  contribution  based  on
    the  rates  of compensation and employee contributions in
    effect at the time  of  such  layoff,  together  with  an
    additional  amount  equal  to  12.2%  of the compensation
    computed for such period of layoff, plus interest on  the
    entire amount at 5% per annum from January 1, 1978 to the
    date  of  payment.   If such contribution is paid, salary
    for pension purposes for any year in which such a  layoff
    occurred  shall  include  the compensation recognized for
    purposes of computing that contribution.
         (9) 9.  For time spent after June  30,  1982,  as  a
    nonsalaried member of the Board of Education, if required
    to  resign from an administrative or teaching position in
    order to qualify as a member of the Board  of  Education,
    an  administrator  or  teacher  desiring  credit therefor
    shall pay the required contributions  at  the  rates  and
    salaries  in  effect  during  such  periods as though the
    member were in service.
    Effective September 1, 1974,  the  interest  charged  for
validation of service described in paragraphs (2) through (5)
sub-paragraphs   2   through  5  of  this  Section  shall  be
compounded annually at a rate of 5% commencing one year after
the termination of the leave, or return to service.
(Source: P.A. 86-272; 86-1488; 87-794.)

    (40 ILCS 5/17-146) (from Ch. 108 1/2, par. 17-146)
    Sec. 17-146.  To make investments.  To invest the  moneys
of the fund, subject to the requirements and restrictions set
forth  in  this  Article  and  in  Sections  1-109,  1-109.1,
1-109.2, 1-110, 1-111, 1-114 and 1-115.  The total book value
of  all  stocks  and convertible debt owned by the fund shall
not exceed 50% of the aggregate book value of all investments
of the fund, calculated on the basis of amortized cost.
    No bank or savings and  loan  association  shall  receive
investment  funds as permitted by this Section, unless it has
complied  with  the  requirements  established  pursuant   to
Section  6  of  the  Public  Funds  Investment  Act.    Those
requirements   shall  be  applicable  only  at  the  time  of
investment and shall  not  require  the  liquidation  of  any
investment at any time.
    The  board  shall  have  the  authority to enter into any
agreements and to execute any documents that it determines to
be necessary to complete any investment transaction.
    All investments shall be clearly held and  accounted  for
to  indicate ownership by the fund.  The board may direct the
registration of securities or the  holding  of  interests  in
real  property  in  the  name of the fund or in the name of a
nominee  created  for  the  express  purpose  of  registering
securities  or  holding  interests  in  real  property  by  a
national or state bank or trust company authorized to conduct
a trust business in the State of  Illinois.   The  board  may
hold  title  to interests in real property in the name of the
fund or in the name of a title  holding  corporation  created
for the express purpose of holding title to interests in real
property.
    Investments  shall  be carried at cost or at a book value
determined in accordance with generally  accepted  accounting
principles  and  accounting procedures approved by the board.
No adjustments shall be made in  investment  carrying  values
for  ordinary current market price fluctuations, but reserves
may be provided to account for possible losses or  unrealized
gains.
    The  book value of investments held by the fund in one or
more commingled investment accounts shall  be  determined  in
accordance  with generally accepted accounting principles the
cost of  its  units  of  participation  in  those  commingled
account or accounts.
    The  board of trustees of any fund established under this
Article  may  not  transfer  its  investment  authority,  nor
transfer the assets of the fund to any other person or entity
for the purpose of consolidating or merging  its  assets  and
management  with  any other pension fund or public investment
authority,  unless  the  board  resolution  authorizing  such
transfer is submitted for approval to  the  contributors  and
pensioners  of  the  fund  at elections held not less than 30
days after the adoption of such resolution by the board,  and
such  resolution  is approved by a majority of the votes cast
on the question in both the  contributors  election  and  the
pensioners   election.      The   election   procedures   and
qualifications  governing  the  election  of  trustees  shall
govern  the submission of resolutions for approval under this
paragraph, insofar as they may be made applicable.
(Source: P.A. 89-636, eff. 8-9-96.)

    (40 ILCS 5/17-146.1) (from Ch. 108 1/2, par. 17-146.1)
    Sec. 17-146.1.  Participation  in  commingled  investment
funds; transfer of investment functions and securities.
    (a)  The  retirement  board  may invest in any commingled
investment fund or funds established and  maintained  by  the
Illinois  State  Board  of Investment under the provisions of
Article 22A of this Code.  The book value of  all  commingled
equity  participations  plus  the  book  value of other stock
investments owned by this system shall not exceed the maximum
permissible percentage rate for equity investments prescribed
in Section 17-146.  All commingled fund participations  shall
be  subject  to the law governing the Illinois State Board of
Investment and the rules, policies  and  directives  of  that
Board.
    (b)  The retirement board may, by resolution duly adopted
by  a  majority  vote  of  its  membership,  transfer  to the
Illinois State Board of Investment created by Article 22A  of
this Code, for management and administration, all investments
owned  by  the  Fund  of  every  kind  and  character.   Upon
completion  of such transfer, the authority of the retirement
board to make investments shall  terminate.  Thereafter,  all
investments  of the reserves of the Fund shall be made by the
Illinois State Board of Investment  in  accordance  with  the
provisions of Article 22A of this Code.
    Such  transfer shall be made not later than the first day
of  the  fourth  month  next  following  the  date  of   such
resolution. Before such transfer an audit of such investments
shall  be completed by a certified public accountant selected
by the Illinois State Board of Investment and approved by the
Auditor General of the State of Illinois. The expense of such
audit shall be defrayed by the retirement board.
(Source: P. A. 78-645.)

    (40 ILCS 5/17-149) (from Ch. 108 1/2, par. 17-149)
    Sec. 17-149. Cancellation of pensions.
    If  any  person  receiving  a   service   or   disability
retirement  pension from the fund is re-employed as a teacher
by the Board of Education, the pension shall be cancelled  on
the  date  the re-employment begins, or on the first day of a
payroll  period  for  which  service  credit  was  validated,
whichever is earlier.  However, beginning  August  23,  1989,
the  pension  shall  not  be  cancelled  in case of a service
retirement pensioner who is temporarily re-employed  for  not
more  than 100 75 days during any school year or on an hourly
basis and is not a contributor, provided the  pensioner  does
not  receive salary in any school year of an amount more than
that payable  to  a  substitute  teacher  for  100  75  days'
employment.    A   service   retirement   pensioner   who  is
temporarily re-employed for not more than 100 days during any
school year or on an hourly basis shall be entitled,  at  the
end of the school year, to a refund of any contributions made
to the fund during that school year.
    If  the  pensioner  does receive salary from the Board of
Education in any school year  for  more  than  100  75  days'
employment  and  then  is  reinstated as a contributor to the
fund, the pensioner shall  be  deemed  to  have  returned  to
service    on    the   first   day   of   employment   as   a
pensioner-substitute.  The pensioner shall reimburse the fund
for pension payments received after the return to service and
shall  pay  to  the  fund  the  participant's   contributions
prescribed in Section 17-130 of this Article.
    If  the  date  of  re-employment  occurs  within 5 school
months after the date of previous  retirement,  exclusive  of
any  vacation period, the member shall be deemed to have been
out of service only temporarily and not permanently  retired.
Such  person  shall  be  entitled to pension payments for the
time he could have been employed as a  teacher  and  received
salary,  but  shall  not be entitled to pension for or during
the summer vacation prior to his return to service.
    When the member again retires on  pension,  the  time  of
service and the money contributed by him during re-employment
shall  be  added  to  the time and money previously credited.
Such person must acquire 3 consecutive  years  of  additional
contributing  service before he may retire again on a pension
at a rate and under conditions other than those in  force  or
attained at the time of his previous retirement.
    Notwithstanding  Sections 1-103.1 and 17-157, the changes
to this Section made by this amendatory  Act  of  1997  shall
apply  without  regard  to  whether  termination  of  service
occurred before the effective date of this amendatory Act and
shall apply retroactively to August 23, 1989.
(Source: P.A. 76-742.)

    Section  90.  The State Mandates Act is amended by adding
Section 8.21 as follows:
    (30 ILCS 805/8.21 new)
    Sec. 8.21. Exempt mandate.   Notwithstanding  Sections  6
and  8 of this Act, no reimbursement by the State is required
for  the  implementation  of  any  mandate  created  by  this
amendatory Act of 1997.

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

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

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