Sen. John J. Cullerton

Filed: 2/8/2017

 

 


 

 


 
10000SB0011sam003LRB100 06001 RPS 21154 a

1
AMENDMENT TO SENATE BILL 11

2    AMENDMENT NO. ______. Amend Senate Bill 11 by replacing
3everything after the enacting clause with the following:
 
4    "Section 5. The Illinois Public Labor Relations Act is
5amended by changing Sections 10 and 15 and by adding Section
67.6 as follows:
 
7    (5 ILCS 315/7.6 new)
8    Sec. 7.6. No collective bargaining or interest arbitration
9regarding certain changes to the Illinois Pension Code.
10    (a) Notwithstanding any other provision of this Act,
11employers shall not be required to bargain over matters
12affected by the changes, the impact of the changes, and the
13implementation of the changes to Article 15, 16, or 17 of the
14Illinois Pension Code made by this amendatory Act of the 100th
15General Assembly, which are deemed to be prohibited subjects of
16bargaining. Notwithstanding any provision of this Act, the

 

 

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1changes, impact of the changes, or implementation of the
2changes to Article 15, 16, or 17 of the Illinois Pension Code
3made by this amendatory Act of the 100th General Assembly shall
4not be subject to interest arbitration or any award issued
5pursuant to interest arbitration. The provisions of this
6Section shall not apply to an employment contract or collective
7bargaining agreement that is in effect on the effective date of
8this amendatory Act of the 100th General Assembly. However, any
9such contract or agreement that is modified, amended, renewed,
10or superseded after the effective date of this amendatory Act
11of the 100th General Assembly shall be subject to the
12provisions of this Section. Each employer with active employees
13participating in a retirement system or pension fund
14established under Article 15, 16, or 17 of the Illinois Pension
15Code shall comply with and be subject to the provisions of this
16amendatory Act of the 100th General Assembly. The provisions of
17this Section shall not apply to the ability of any employer and
18employee representative to bargain collectively with regard to
19the pick up of employee contributions pursuant to Section
2015-157.1, 16-152.1, 17-130.1, or 17-130.2 of the Illinois
21Pension Code.
22    (b) Subject to and except for the matters set forth in
23subsection (a) of this Section that are deemed prohibited
24subjects of bargaining, nothing in this Section shall be
25construed as otherwise limiting any of the obligations and
26requirements applicable to employers under any of the

 

 

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1provisions of this Act, including, but not limited to, the
2requirement to bargain collectively with regard to policy
3matters directly affecting wages, hours, and terms and
4conditions of employment as well as the impact thereon upon
5request by employee representatives. Subject to and except for
6the matters set forth in subsection (a) of this Section that
7are deemed prohibited subjects of bargaining, nothing in this
8Section shall be construed as otherwise limiting any of the
9rights of employees or employee representatives under the
10provisions of this Act.
11    (c) In case of any conflict between this Section and any
12other provisions of this Act or any other law, the provisions
13of this Section shall control.
 
14    (5 ILCS 315/10)  (from Ch. 48, par. 1610)
15    Sec. 10. Unfair labor practices.
16    (a) It shall be an unfair labor practice for an employer or
17its agents:
18        (1) to interfere with, restrain or coerce public
19    employees in the exercise of the rights guaranteed in this
20    Act or to dominate or interfere with the formation,
21    existence or administration of any labor organization or
22    contribute financial or other support to it; provided, an
23    employer shall not be prohibited from permitting employees
24    to confer with him during working hours without loss of
25    time or pay;

 

 

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1        (2) to discriminate in regard to hire or tenure of
2    employment or any term or condition of employment in order
3    to encourage or discourage membership in or other support
4    for any labor organization. Nothing in this Act or any
5    other law precludes a public employer from making an
6    agreement with a labor organization to require as a
7    condition of employment the payment of a fair share under
8    paragraph (e) of Section 6;
9        (3) to discharge or otherwise discriminate against a
10    public employee because he has signed or filed an
11    affidavit, petition or charge or provided any information
12    or testimony under this Act;
13        (4) subject to and except as provided in Section 7.6,
14    to refuse to bargain collectively in good faith with a
15    labor organization which is the exclusive representative
16    of public employees in an appropriate unit, including, but
17    not limited to, the discussing of grievances with the
18    exclusive representative; however, no actions of the
19    employer taken to implement or otherwise comply with the
20    provisions of subsection (a) of Section 7.6 shall
21    constitute or give rise to an unfair labor practice under
22    this Act;
23        (5) to violate any of the rules and regulations
24    established by the Board with jurisdiction over them
25    relating to the conduct of representation elections or the
26    conduct affecting the representation elections;

 

 

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1        (6) to expend or cause the expenditure of public funds
2    to any external agent, individual, firm, agency,
3    partnership or association in any attempt to influence the
4    outcome of representational elections held pursuant to
5    Section 9 of this Act; provided, that nothing in this
6    subsection shall be construed to limit an employer's right
7    to internally communicate with its employees as provided in
8    subsection (c) of this Section, to be represented on any
9    matter pertaining to unit determinations, unfair labor
10    practice charges or pre-election conferences in any formal
11    or informal proceeding before the Board, or to seek or
12    obtain advice from legal counsel. Nothing in this paragraph
13    shall be construed to prohibit an employer from expending
14    or causing the expenditure of public funds on, or seeking
15    or obtaining services or advice from, any organization,
16    group, or association established by and including public
17    or educational employers, whether covered by this Act, the
18    Illinois Educational Labor Relations Act or the public
19    employment labor relations law of any other state or the
20    federal government, provided that such services or advice
21    are generally available to the membership of the
22    organization, group or association, and are not offered
23    solely in an attempt to influence the outcome of a
24    particular representational election; or
25        (7) to refuse to reduce a collective bargaining
26    agreement to writing or to refuse to sign such agreement.

 

 

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1    (b) It shall be an unfair labor practice for a labor
2organization or its agents:
3        (1) to restrain or coerce public employees in the
4    exercise of the rights guaranteed in this Act, provided,
5    (i) that this paragraph shall not impair the right of a
6    labor organization to prescribe its own rules with respect
7    to the acquisition or retention of membership therein or
8    the determination of fair share payments and (ii) that a
9    labor organization or its agents shall commit an unfair
10    labor practice under this paragraph in duty of fair
11    representation cases only by intentional misconduct in
12    representing employees under this Act;
13        (2) to restrain or coerce a public employer in the
14    selection of his representatives for the purposes of
15    collective bargaining or the settlement of grievances; or
16        (3) to cause, or attempt to cause, an employer to
17    discriminate against an employee in violation of
18    subsection (a)(2);
19        (4) to refuse to bargain collectively in good faith
20    with a public employer, if it has been designated in
21    accordance with the provisions of this Act as the exclusive
22    representative of public employees in an appropriate unit;
23        (5) to violate any of the rules and regulations
24    established by the boards with jurisdiction over them
25    relating to the conduct of representation elections or the
26    conduct affecting the representation elections;

 

 

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1        (6) to discriminate against any employee because he has
2    signed or filed an affidavit, petition or charge or
3    provided any information or testimony under this Act;
4        (7) to picket or cause to be picketed, or threaten to
5    picket or cause to be picketed, any public employer where
6    an object thereof is forcing or requiring an employer to
7    recognize or bargain with a labor organization of the
8    representative of its employees, or forcing or requiring
9    the employees of an employer to accept or select such labor
10    organization as their collective bargaining
11    representative, unless such labor organization is
12    currently certified as the representative of such
13    employees:
14            (A) where the employer has lawfully recognized in
15        accordance with this Act any labor organization and a
16        question concerning representation may not
17        appropriately be raised under Section 9 of this Act;
18            (B) where within the preceding 12 months a valid
19        election under Section 9 of this Act has been
20        conducted; or
21            (C) where such picketing has been conducted
22        without a petition under Section 9 being filed within a
23        reasonable period of time not to exceed 30 days from
24        the commencement of such picketing; provided that when
25        such a petition has been filed the Board shall
26        forthwith, without regard to the provisions of

 

 

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1        subsection (a) of Section 9 or the absence of a showing
2        of a substantial interest on the part of the labor
3        organization, direct an election in such unit as the
4        Board finds to be appropriate and shall certify the
5        results thereof; provided further, that nothing in
6        this subparagraph shall be construed to prohibit any
7        picketing or other publicity for the purpose of
8        truthfully advising the public that an employer does
9        not employ members of, or have a contract with, a labor
10        organization unless an effect of such picketing is to
11        induce any individual employed by any other person in
12        the course of his employment, not to pick up, deliver,
13        or transport any goods or not to perform any services;
14        or
15        (8) to refuse to reduce a collective bargaining
16    agreement to writing or to refuse to sign such agreement.
17    (c) The expressing of any views, argument, or opinion or
18the dissemination thereof, whether in written, printed,
19graphic, or visual form, shall not constitute or be evidence of
20an unfair labor practice under any of the provisions of this
21Act, if such expression contains no threat of reprisal or force
22or promise of benefit.
23(Source: P.A. 86-412; 87-736.)
 
24    (5 ILCS 315/15)  (from Ch. 48, par. 1615)
25    (Text of Section WITHOUT the changes made by P.A. 98-599,

 

 

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1which has been held unconstitutional)
2    Sec. 15. Act Takes Precedence.
3    (a) In case of any conflict between the provisions of this
4Act and any other law (other than Section 5 of the State
5Employees Group Insurance Act of 1971 and other than the
6changes made to the Illinois Pension Code by this amendatory
7Act of the 96th General Assembly), executive order or
8administrative regulation relating to wages, hours and
9conditions of employment and employment relations, the
10provisions of this Act or any collective bargaining agreement
11negotiated thereunder shall prevail and control. Nothing in
12this Act shall be construed to replace or diminish the rights
13of employees established by Sections 28 and 28a of the
14Metropolitan Transit Authority Act, Sections 2.15 through 2.19
15of the Regional Transportation Authority Act. The provisions of
16this Act are subject to Section 5 of the State Employees Group
17Insurance Act of 1971. Nothing in this Act shall be construed
18to replace the necessity of complaints against a sworn peace
19officer, as defined in Section 2(a) of the Uniform Peace
20Officer Disciplinary Act, from having a complaint supported by
21a sworn affidavit.
22    (b) Except as provided in subsection (a) above, any
23collective bargaining contract between a public employer and a
24labor organization executed pursuant to this Act shall
25supersede any contrary statutes, charters, ordinances, rules
26or regulations relating to wages, hours and conditions of

 

 

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1employment and employment relations adopted by the public
2employer or its agents. Any collective bargaining agreement
3entered into prior to the effective date of this Act shall
4remain in full force during its duration.
5    (c) It is the public policy of this State, pursuant to
6paragraphs (h) and (i) of Section 6 of Article VII of the
7Illinois Constitution, that the provisions of this Act are the
8exclusive exercise by the State of powers and functions which
9might otherwise be exercised by home rule units. Such powers
10and functions may not be exercised concurrently, either
11directly or indirectly, by any unit of local government,
12including any home rule unit, except as otherwise authorized by
13this Act.
14    (d) Notwithstanding any other provision of law, no
15collective bargaining agreement entered into, renewed, or
16extended after the effective date of this amendatory Act of the
17100th General Assembly or any arbitration award issued under
18such collective bargaining agreement may violate or conflict
19with the changes made by this amendatory Act of the 100th
20General Assembly.
21(Source: P.A. 95-331, eff. 8-21-07; 96-889, eff. 1-1-11.)
 
22    Section 10. The State Employees Group Insurance Act of 1971
23is amended by changing Sections 3 and 10 as follows:
 
24    (5 ILCS 375/3)  (from Ch. 127, par. 523)

 

 

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1    Sec. 3. Definitions. Unless the context otherwise
2requires, the following words and phrases as used in this Act
3shall have the following meanings. The Department may define
4these and other words and phrases separately for the purpose of
5implementing specific programs providing benefits under this
6Act.
7    (a) "Administrative service organization" means any
8person, firm or corporation experienced in the handling of
9claims which is fully qualified, financially sound and capable
10of meeting the service requirements of a contract of
11administration executed with the Department.
12    (b) "Annuitant" means (1) an employee who retires, or has
13retired, on or after January 1, 1966 on an immediate annuity
14under the provisions of Articles 2, 14 (including an employee
15who has elected to receive an alternative retirement
16cancellation payment under Section 14-108.5 of the Illinois
17Pension Code in lieu of an annuity or who meets the criteria
18for retirement, but in lieu of receiving an annuity under that
19Article has elected to receive an accelerated pension benefit
20payment under Section 14-147.5 of that Article), 15 (including
21an employee who has retired under the optional retirement
22program established under Section 15-158.2 or who meets the
23criteria for retirement but in lieu of receiving an annuity
24under that Article has elected to receive an accelerated
25pension benefit payment under Section 15-185.5 of the Article),
26paragraphs (2), (3), or (5) of Section 16-106 (including an

 

 

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1employee who meets the criteria for retirement, but in lieu of
2receiving an annuity under that Article has elected to receive
3an accelerated pension benefit payment under Section 16-190.5
4of the Illinois Pension Code), or Article 18 of the Illinois
5Pension Code; (2) any person who was receiving group insurance
6coverage under this Act as of March 31, 1978 by reason of his
7status as an annuitant, even though the annuity in relation to
8which such coverage was provided is a proportional annuity
9based on less than the minimum period of service required for a
10retirement annuity in the system involved; (3) any person not
11otherwise covered by this Act who has retired as a
12participating member under Article 2 of the Illinois Pension
13Code but is ineligible for the retirement annuity under Section
142-119 of the Illinois Pension Code; (4) the spouse of any
15person who is receiving a retirement annuity under Article 18
16of the Illinois Pension Code and who is covered under a group
17health insurance program sponsored by a governmental employer
18other than the State of Illinois and who has irrevocably
19elected to waive his or her coverage under this Act and to have
20his or her spouse considered as the "annuitant" under this Act
21and not as a "dependent"; or (5) an employee who retires, or
22has retired, from a qualified position, as determined according
23to rules promulgated by the Director, under a qualified local
24government, a qualified rehabilitation facility, a qualified
25domestic violence shelter or service, or a qualified child
26advocacy center. (For definition of "retired employee", see (p)

 

 

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1post).
2    (b-5) (Blank).
3    (b-6) (Blank).
4    (b-7) (Blank).
5    (c) "Carrier" means (1) an insurance company, a corporation
6organized under the Limited Health Service Organization Act or
7the Voluntary Health Services Plan Act, a partnership, or other
8nongovernmental organization, which is authorized to do group
9life or group health insurance business in Illinois, or (2) the
10State of Illinois as a self-insurer.
11    (d) "Compensation" means salary or wages payable on a
12regular payroll by the State Treasurer on a warrant of the
13State Comptroller out of any State, trust or federal fund, or
14by the Governor of the State through a disbursing officer of
15the State out of a trust or out of federal funds, or by any
16Department out of State, trust, federal or other funds held by
17the State Treasurer or the Department, to any person for
18personal services currently performed, and ordinary or
19accidental disability benefits under Articles 2, 14, 15
20(including ordinary or accidental disability benefits under
21the optional retirement program established under Section
2215-158.2), paragraphs (2), (3), or (5) of Section 16-106, or
23Article 18 of the Illinois Pension Code, for disability
24incurred after January 1, 1966, or benefits payable under the
25Workers' Compensation or Occupational Diseases Act or benefits
26payable under a sick pay plan established in accordance with

 

 

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1Section 36 of the State Finance Act. "Compensation" also means
2salary or wages paid to an employee of any qualified local
3government, qualified rehabilitation facility, qualified
4domestic violence shelter or service, or qualified child
5advocacy center.
6    (e) "Commission" means the State Employees Group Insurance
7Advisory Commission authorized by this Act. Commencing July 1,
81984, "Commission" as used in this Act means the Commission on
9Government Forecasting and Accountability as established by
10the Legislative Commission Reorganization Act of 1984.
11    (f) "Contributory", when referred to as contributory
12coverage, shall mean optional coverages or benefits elected by
13the member toward the cost of which such member makes
14contribution, or which are funded in whole or in part through
15the acceptance of a reduction in earnings or the foregoing of
16an increase in earnings by an employee, as distinguished from
17noncontributory coverage or benefits which are paid entirely by
18the State of Illinois without reduction of the member's salary.
19    (g) "Department" means any department, institution, board,
20commission, officer, court or any agency of the State
21government receiving appropriations and having power to
22certify payrolls to the Comptroller authorizing payments of
23salary and wages against such appropriations as are made by the
24General Assembly from any State fund, or against trust funds
25held by the State Treasurer and includes boards of trustees of
26the retirement systems created by Articles 2, 14, 15, 16 and 18

 

 

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1of the Illinois Pension Code. "Department" also includes the
2Illinois Comprehensive Health Insurance Board, the Board of
3Examiners established under the Illinois Public Accounting
4Act, and the Illinois Finance Authority.
5    (h) "Dependent", when the term is used in the context of
6the health and life plan, means a member's spouse and any child
7(1) from birth to age 26 including an adopted child, a child
8who lives with the member from the time of the filing of a
9petition for adoption until entry of an order of adoption, a
10stepchild or adjudicated child, or a child who lives with the
11member if such member is a court appointed guardian of the
12child or (2) age 19 or over who has a mental or physical
13disability from a cause originating prior to the age of 19 (age
1426 if enrolled as an adult child dependent). For the health
15plan only, the term "dependent" also includes (1) any person
16enrolled prior to the effective date of this Section who is
17dependent upon the member to the extent that the member may
18claim such person as a dependent for income tax deduction
19purposes and (2) any person who has received after June 30,
202000 an organ transplant and who is financially dependent upon
21the member and eligible to be claimed as a dependent for income
22tax purposes. A member requesting to cover any dependent must
23provide documentation as requested by the Department of Central
24Management Services and file with the Department any and all
25forms required by the Department.
26    (i) "Director" means the Director of the Illinois

 

 

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1Department of Central Management Services.
2    (j) "Eligibility period" means the period of time a member
3has to elect enrollment in programs or to select benefits
4without regard to age, sex or health.
5    (k) "Employee" means and includes each officer or employee
6in the service of a department who (1) receives his
7compensation for service rendered to the department on a
8warrant issued pursuant to a payroll certified by a department
9or on a warrant or check issued and drawn by a department upon
10a trust, federal or other fund or on a warrant issued pursuant
11to a payroll certified by an elected or duly appointed officer
12of the State or who receives payment of the performance of
13personal services on a warrant issued pursuant to a payroll
14certified by a Department and drawn by the Comptroller upon the
15State Treasurer against appropriations made by the General
16Assembly from any fund or against trust funds held by the State
17Treasurer, and (2) is employed full-time or part-time in a
18position normally requiring actual performance of duty during
19not less than 1/2 of a normal work period, as established by
20the Director in cooperation with each department, except that
21persons elected by popular vote will be considered employees
22during the entire term for which they are elected regardless of
23hours devoted to the service of the State, and (3) except that
24"employee" does not include any person who is not eligible by
25reason of such person's employment to participate in one of the
26State retirement systems under Articles 2, 14, 15 (either the

 

 

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1regular Article 15 system or the optional retirement program
2established under Section 15-158.2) or 18, or under paragraph
3(2), (3), or (5) of Section 16-106, of the Illinois Pension
4Code, but such term does include persons who are employed
5during the 6 month qualifying period under Article 14 of the
6Illinois Pension Code. Such term also includes any person who
7(1) after January 1, 1966, is receiving ordinary or accidental
8disability benefits under Articles 2, 14, 15 (including
9ordinary or accidental disability benefits under the optional
10retirement program established under Section 15-158.2),
11paragraphs (2), (3), or (5) of Section 16-106, or Article 18 of
12the Illinois Pension Code, for disability incurred after
13January 1, 1966, (2) receives total permanent or total
14temporary disability under the Workers' Compensation Act or
15Occupational Disease Act as a result of injuries sustained or
16illness contracted in the course of employment with the State
17of Illinois, or (3) is not otherwise covered under this Act and
18has retired as a participating member under Article 2 of the
19Illinois Pension Code but is ineligible for the retirement
20annuity under Section 2-119 of the Illinois Pension Code.
21However, a person who satisfies the criteria of the foregoing
22definition of "employee" except that such person is made
23ineligible to participate in the State Universities Retirement
24System by clause (4) of subsection (a) of Section 15-107 of the
25Illinois Pension Code is also an "employee" for the purposes of
26this Act. "Employee" also includes any person receiving or

 

 

10000SB0011sam003- 18 -LRB100 06001 RPS 21154 a

1eligible for benefits under a sick pay plan established in
2accordance with Section 36 of the State Finance Act. "Employee"
3also includes (i) each officer or employee in the service of a
4qualified local government, including persons appointed as
5trustees of sanitary districts regardless of hours devoted to
6the service of the sanitary district, (ii) each employee in the
7service of a qualified rehabilitation facility, (iii) each
8full-time employee in the service of a qualified domestic
9violence shelter or service, and (iv) each full-time employee
10in the service of a qualified child advocacy center, as
11determined according to rules promulgated by the Director.
12    (l) "Member" means an employee, annuitant, retired
13employee or survivor. In the case of an annuitant or retired
14employee who first becomes an annuitant or retired employee on
15or after the effective date of this amendatory Act of the 97th
16General Assembly, the individual must meet the minimum vesting
17requirements of the applicable retirement system in order to be
18eligible for group insurance benefits under that system. In the
19case of a survivor who first becomes a survivor on or after the
20effective date of this amendatory Act of the 97th General
21Assembly, the deceased employee, annuitant, or retired
22employee upon whom the annuity is based must have been eligible
23to participate in the group insurance system under the
24applicable retirement system in order for the survivor to be
25eligible for group insurance benefits under that system.
26    (m) "Optional coverages or benefits" means those coverages

 

 

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1or benefits available to the member on his or her voluntary
2election, and at his or her own expense.
3    (n) "Program" means the group life insurance, health
4benefits and other employee benefits designed and contracted
5for by the Director under this Act.
6    (o) "Health plan" means a health benefits program offered
7by the State of Illinois for persons eligible for the plan.
8    (p) "Retired employee" means any person who would be an
9annuitant as that term is defined herein but for the fact that
10such person retired prior to January 1, 1966. Such term also
11includes any person formerly employed by the University of
12Illinois in the Cooperative Extension Service who would be an
13annuitant but for the fact that such person was made ineligible
14to participate in the State Universities Retirement System by
15clause (4) of subsection (a) of Section 15-107 of the Illinois
16Pension Code.
17    (q) "Survivor" means a person receiving an annuity as a
18survivor of an employee or of an annuitant. "Survivor" also
19includes: (1) the surviving dependent of a person who satisfies
20the definition of "employee" except that such person is made
21ineligible to participate in the State Universities Retirement
22System by clause (4) of subsection (a) of Section 15-107 of the
23Illinois Pension Code; (2) the surviving dependent of any
24person formerly employed by the University of Illinois in the
25Cooperative Extension Service who would be an annuitant except
26for the fact that such person was made ineligible to

 

 

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1participate in the State Universities Retirement System by
2clause (4) of subsection (a) of Section 15-107 of the Illinois
3Pension Code; and (3) the surviving dependent of a person who
4was an annuitant under this Act by virtue of receiving an
5alternative retirement cancellation payment under Section
614-108.5 of the Illinois Pension Code.
7    (q-2) "SERS" means the State Employees' Retirement System
8of Illinois, created under Article 14 of the Illinois Pension
9Code.
10    (q-3) "SURS" means the State Universities Retirement
11System, created under Article 15 of the Illinois Pension Code.
12    (q-4) "TRS" means the Teachers' Retirement System of the
13State of Illinois, created under Article 16 of the Illinois
14Pension Code.
15    (q-5) (Blank).
16    (q-6) (Blank).
17    (q-7) (Blank).
18    (r) "Medical services" means the services provided within
19the scope of their licenses by practitioners in all categories
20licensed under the Medical Practice Act of 1987.
21    (s) "Unit of local government" means any county,
22municipality, township, school district (including a
23combination of school districts under the Intergovernmental
24Cooperation Act), special district or other unit, designated as
25a unit of local government by law, which exercises limited
26governmental powers or powers in respect to limited

 

 

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1governmental subjects, any not-for-profit association with a
2membership that primarily includes townships and township
3officials, that has duties that include provision of research
4service, dissemination of information, and other acts for the
5purpose of improving township government, and that is funded
6wholly or partly in accordance with Section 85-15 of the
7Township Code; any not-for-profit corporation or association,
8with a membership consisting primarily of municipalities, that
9operates its own utility system, and provides research,
10training, dissemination of information, or other acts to
11promote cooperation between and among municipalities that
12provide utility services and for the advancement of the goals
13and purposes of its membership; the Southern Illinois
14Collegiate Common Market, which is a consortium of higher
15education institutions in Southern Illinois; the Illinois
16Association of Park Districts; and any hospital provider that
17is owned by a county that has 100 or fewer hospital beds and
18has not already joined the program. "Qualified local
19government" means a unit of local government approved by the
20Director and participating in a program created under
21subsection (i) of Section 10 of this Act.
22    (t) "Qualified rehabilitation facility" means any
23not-for-profit organization that is accredited by the
24Commission on Accreditation of Rehabilitation Facilities or
25certified by the Department of Human Services (as successor to
26the Department of Mental Health and Developmental

 

 

10000SB0011sam003- 22 -LRB100 06001 RPS 21154 a

1Disabilities) to provide services to persons with disabilities
2and which receives funds from the State of Illinois for
3providing those services, approved by the Director and
4participating in a program created under subsection (j) of
5Section 10 of this Act.
6    (u) "Qualified domestic violence shelter or service" means
7any Illinois domestic violence shelter or service and its
8administrative offices funded by the Department of Human
9Services (as successor to the Illinois Department of Public
10Aid), approved by the Director and participating in a program
11created under subsection (k) of Section 10.
12    (v) "TRS benefit recipient" means a person who:
13        (1) is not a "member" as defined in this Section; and
14        (2) is receiving a monthly benefit or retirement
15    annuity under Article 16 of the Illinois Pension Code; and
16        (3) either (i) has at least 8 years of creditable
17    service under Article 16 of the Illinois Pension Code, or
18    (ii) was enrolled in the health insurance program offered
19    under that Article on January 1, 1996, or (iii) is the
20    survivor of a benefit recipient who had at least 8 years of
21    creditable service under Article 16 of the Illinois Pension
22    Code or was enrolled in the health insurance program
23    offered under that Article on the effective date of this
24    amendatory Act of 1995, or (iv) is a recipient or survivor
25    of a recipient of a disability benefit under Article 16 of
26    the Illinois Pension Code.

 

 

10000SB0011sam003- 23 -LRB100 06001 RPS 21154 a

1    (w) "TRS dependent beneficiary" means a person who:
2        (1) is not a "member" or "dependent" as defined in this
3    Section; and
4        (2) is a TRS benefit recipient's: (A) spouse, (B)
5    dependent parent who is receiving at least half of his or
6    her support from the TRS benefit recipient, or (C) natural,
7    step, adjudicated, or adopted child who is (i) under age
8    26, (ii) was, on January 1, 1996, participating as a
9    dependent beneficiary in the health insurance program
10    offered under Article 16 of the Illinois Pension Code, or
11    (iii) age 19 or over who has a mental or physical
12    disability from a cause originating prior to the age of 19
13    (age 26 if enrolled as an adult child).
14    "TRS dependent beneficiary" does not include, as indicated
15under paragraph (2) of this subsection (w), a dependent of the
16survivor of a TRS benefit recipient who first becomes a
17dependent of a survivor of a TRS benefit recipient on or after
18the effective date of this amendatory Act of the 97th General
19Assembly unless that dependent would have been eligible for
20coverage as a dependent of the deceased TRS benefit recipient
21upon whom the survivor benefit is based.
22    (x) "Military leave" refers to individuals in basic
23training for reserves, special/advanced training, annual
24training, emergency call up, activation by the President of the
25United States, or any other training or duty in service to the
26United States Armed Forces.

 

 

10000SB0011sam003- 24 -LRB100 06001 RPS 21154 a

1    (y) (Blank).
2    (z) "Community college benefit recipient" means a person
3who:
4        (1) is not a "member" as defined in this Section; and
5        (2) is receiving a monthly survivor's annuity or
6    retirement annuity under Article 15 of the Illinois Pension
7    Code; and
8        (3) either (i) was a full-time employee of a community
9    college district or an association of community college
10    boards created under the Public Community College Act
11    (other than an employee whose last employer under Article
12    15 of the Illinois Pension Code was a community college
13    district subject to Article VII of the Public Community
14    College Act) and was eligible to participate in a group
15    health benefit plan as an employee during the time of
16    employment with a community college district (other than a
17    community college district subject to Article VII of the
18    Public Community College Act) or an association of
19    community college boards, or (ii) is the survivor of a
20    person described in item (i).
21    (aa) "Community college dependent beneficiary" means a
22person who:
23        (1) is not a "member" or "dependent" as defined in this
24    Section; and
25        (2) is a community college benefit recipient's: (A)
26    spouse, (B) dependent parent who is receiving at least half

 

 

10000SB0011sam003- 25 -LRB100 06001 RPS 21154 a

1    of his or her support from the community college benefit
2    recipient, or (C) natural, step, adjudicated, or adopted
3    child who is (i) under age 26, or (ii) age 19 or over and
4    has a mental or physical disability from a cause
5    originating prior to the age of 19 (age 26 if enrolled as
6    an adult child).
7    "Community college dependent beneficiary" does not
8include, as indicated under paragraph (2) of this subsection
9(aa), a dependent of the survivor of a community college
10benefit recipient who first becomes a dependent of a survivor
11of a community college benefit recipient on or after the
12effective date of this amendatory Act of the 97th General
13Assembly unless that dependent would have been eligible for
14coverage as a dependent of the deceased community college
15benefit recipient upon whom the survivor annuity is based.
16    (bb) "Qualified child advocacy center" means any Illinois
17child advocacy center and its administrative offices funded by
18the Department of Children and Family Services, as defined by
19the Children's Advocacy Center Act (55 ILCS 80/), approved by
20the Director and participating in a program created under
21subsection (n) of Section 10.
22(Source: P.A. 98-488, eff. 8-16-13; 99-143, eff. 7-27-15.)
 
23    (5 ILCS 375/10)  (from Ch. 127, par. 530)
24    Sec. 10. Contributions by the State and members.
25    (a) The State shall pay the cost of basic non-contributory

 

 

10000SB0011sam003- 26 -LRB100 06001 RPS 21154 a

1group life insurance and, subject to member paid contributions
2set by the Department or required by this Section and except as
3provided in this Section, the basic program of group health
4benefits on each eligible member, except a member, not
5otherwise covered by this Act, who has retired as a
6participating member under Article 2 of the Illinois Pension
7Code but is ineligible for the retirement annuity under Section
82-119 of the Illinois Pension Code, and part of each eligible
9member's and retired member's premiums for health insurance
10coverage for enrolled dependents as provided by Section 9. The
11State shall pay the cost of the basic program of group health
12benefits only after benefits are reduced by the amount of
13benefits covered by Medicare for all members and dependents who
14are eligible for benefits under Social Security or the Railroad
15Retirement system or who had sufficient Medicare-covered
16government employment, except that such reduction in benefits
17shall apply only to those members and dependents who (1) first
18become eligible for such Medicare coverage on or after July 1,
191992; or (2) are Medicare-eligible members or dependents of a
20local government unit which began participation in the program
21on or after July 1, 1992; or (3) remain eligible for, but no
22longer receive Medicare coverage which they had been receiving
23on or after July 1, 1992. The Department may determine the
24aggregate level of the State's contribution on the basis of
25actual cost of medical services adjusted for age, sex or
26geographic or other demographic characteristics which affect

 

 

10000SB0011sam003- 27 -LRB100 06001 RPS 21154 a

1the costs of such programs.
2    The cost of participation in the basic program of group
3health benefits for the dependent or survivor of a living or
4deceased retired employee who was formerly employed by the
5University of Illinois in the Cooperative Extension Service and
6would be an annuitant but for the fact that he or she was made
7ineligible to participate in the State Universities Retirement
8System by clause (4) of subsection (a) of Section 15-107 of the
9Illinois Pension Code shall not be greater than the cost of
10participation that would otherwise apply to that dependent or
11survivor if he or she were the dependent or survivor of an
12annuitant under the State Universities Retirement System.
13    (a-1) (Blank).
14    (a-2) (Blank).
15    (a-3) (Blank).
16    (a-4) (Blank).
17    (a-5) (Blank).
18    (a-6) (Blank).
19    (a-7) (Blank).
20    (a-8) Any annuitant, survivor, or retired employee may
21waive or terminate coverage in the program of group health
22benefits. Any such annuitant, survivor, or retired employee who
23has waived or terminated coverage may enroll or re-enroll in
24the program of group health benefits only during the annual
25benefit choice period, as determined by the Director; except
26that in the event of termination of coverage due to nonpayment

 

 

10000SB0011sam003- 28 -LRB100 06001 RPS 21154 a

1of premiums, the annuitant, survivor, or retired employee may
2not re-enroll in the program.
3    (a-8.5) Beginning on the effective date of this amendatory
4Act of the 97th General Assembly, the Director of Central
5Management Services shall, on an annual basis, determine the
6amount that the State shall contribute toward the basic program
7of group health benefits on behalf of annuitants (including
8individuals who (i) participated in the General Assembly
9Retirement System, the State Employees' Retirement System of
10Illinois, the State Universities Retirement System, the
11Teachers' Retirement System of the State of Illinois, or the
12Judges Retirement System of Illinois and (ii) qualify as
13annuitants under subsection (b) of Section 3 of this Act),
14survivors (including individuals who (i) receive an annuity as
15a survivor of an individual who participated in the General
16Assembly Retirement System, the State Employees' Retirement
17System of Illinois, the State Universities Retirement System,
18the Teachers' Retirement System of the State of Illinois, or
19the Judges Retirement System of Illinois and (ii) qualify as
20survivors under subsection (q) of Section 3 of this Act), and
21retired employees (as defined in subsection (p) of Section 3 of
22this Act). The remainder of the cost of coverage for each
23annuitant, survivor, or retired employee, as determined by the
24Director of Central Management Services, shall be the
25responsibility of that annuitant, survivor, or retired
26employee.

 

 

10000SB0011sam003- 29 -LRB100 06001 RPS 21154 a

1    Contributions required of annuitants, survivors, and
2retired employees shall be the same for all retirement systems
3and shall also be based on whether an individual has made an
4election under Section 15-135.1 of the Illinois Pension Code.
5Contributions may be based on annuitants', survivors', or
6retired employees' Medicare eligibility, but may not be based
7on Social Security eligibility.
8    (a-9) No later than May 1 of each calendar year, the
9Director of Central Management Services shall certify in
10writing to the Executive Secretary of the State Employees'
11Retirement System of Illinois the amounts of the Medicare
12supplement health care premiums and the amounts of the health
13care premiums for all other retirees who are not Medicare
14eligible.
15    A separate calculation of the premiums based upon the
16actual cost of each health care plan shall be so certified.
17    The Director of Central Management Services shall provide
18to the Executive Secretary of the State Employees' Retirement
19System of Illinois such information, statistics, and other data
20as he or she may require to review the premium amounts
21certified by the Director of Central Management Services.
22    The Department of Central Management Services, or any
23successor agency designated to procure healthcare contracts
24pursuant to this Act, is authorized to establish funds,
25separate accounts provided by any bank or banks as defined by
26the Illinois Banking Act, or separate accounts provided by any

 

 

10000SB0011sam003- 30 -LRB100 06001 RPS 21154 a

1savings and loan association or associations as defined by the
2Illinois Savings and Loan Act of 1985 to be held by the
3Director, outside the State treasury, for the purpose of
4receiving the transfer of moneys from the Local Government
5Health Insurance Reserve Fund. The Department may promulgate
6rules further defining the methodology for the transfers. Any
7interest earned by moneys in the funds or accounts shall inure
8to the Local Government Health Insurance Reserve Fund. The
9transferred moneys, and interest accrued thereon, shall be used
10exclusively for transfers to administrative service
11organizations or their financial institutions for payments of
12claims to claimants and providers under the self-insurance
13health plan. The transferred moneys, and interest accrued
14thereon, shall not be used for any other purpose including, but
15not limited to, reimbursement of administration fees due the
16administrative service organization pursuant to its contract
17or contracts with the Department.
18    (a-10) To the extent that participation, benefits, or
19premiums under this Act are based on a person's service credit
20under an Article of the Illinois Pension Code, service credit
21terminated in exchange for an accelerated pension benefit
22payment under Section 14-147.5, 15-185.5, or 16-190.5 of that
23Code shall be included in determining a person's service credit
24for the purposes of this Act.
25    (b) State employees who become eligible for this program on
26or after January 1, 1980 in positions normally requiring actual

 

 

10000SB0011sam003- 31 -LRB100 06001 RPS 21154 a

1performance of duty not less than 1/2 of a normal work period
2but not equal to that of a normal work period, shall be given
3the option of participating in the available program. If the
4employee elects coverage, the State shall contribute on behalf
5of such employee to the cost of the employee's benefit and any
6applicable dependent supplement, that sum which bears the same
7percentage as that percentage of time the employee regularly
8works when compared to normal work period.
9    (c) The basic non-contributory coverage from the basic
10program of group health benefits shall be continued for each
11employee not in pay status or on active service by reason of
12(1) leave of absence due to illness or injury, (2) authorized
13educational leave of absence or sabbatical leave, or (3)
14military leave. This coverage shall continue until expiration
15of authorized leave and return to active service, but not to
16exceed 24 months for leaves under item (1) or (2). This
1724-month limitation and the requirement of returning to active
18service shall not apply to persons receiving ordinary or
19accidental disability benefits or retirement benefits through
20the appropriate State retirement system or benefits under the
21Workers' Compensation or Occupational Disease Act.
22    (d) The basic group life insurance coverage shall continue,
23with full State contribution, where such person is (1) absent
24from active service by reason of disability arising from any
25cause other than self-inflicted, (2) on authorized educational
26leave of absence or sabbatical leave, or (3) on military leave.

 

 

10000SB0011sam003- 32 -LRB100 06001 RPS 21154 a

1    (e) Where the person is in non-pay status for a period in
2excess of 30 days or on leave of absence, other than by reason
3of disability, educational or sabbatical leave, or military
4leave, such person may continue coverage only by making
5personal payment equal to the amount normally contributed by
6the State on such person's behalf. Such payments and coverage
7may be continued: (1) until such time as the person returns to
8a status eligible for coverage at State expense, but not to
9exceed 24 months or (2) until such person's employment or
10annuitant status with the State is terminated (exclusive of any
11additional service imposed pursuant to law).
12    (f) The Department shall establish by rule the extent to
13which other employee benefits will continue for persons in
14non-pay status or who are not in active service.
15    (g) The State shall not pay the cost of the basic
16non-contributory group life insurance, program of health
17benefits and other employee benefits for members who are
18survivors as defined by paragraphs (1) and (2) of subsection
19(q) of Section 3 of this Act. The costs of benefits for these
20survivors shall be paid by the survivors or by the University
21of Illinois Cooperative Extension Service, or any combination
22thereof. However, the State shall pay the amount of the
23reduction in the cost of participation, if any, resulting from
24the amendment to subsection (a) made by this amendatory Act of
25the 91st General Assembly.
26    (h) Those persons occupying positions with any department

 

 

10000SB0011sam003- 33 -LRB100 06001 RPS 21154 a

1as a result of emergency appointments pursuant to Section 8b.8
2of the Personnel Code who are not considered employees under
3this Act shall be given the option of participating in the
4programs of group life insurance, health benefits and other
5employee benefits. Such persons electing coverage may
6participate only by making payment equal to the amount normally
7contributed by the State for similarly situated employees. Such
8amounts shall be determined by the Director. Such payments and
9coverage may be continued until such time as the person becomes
10an employee pursuant to this Act or such person's appointment
11is terminated.
12    (i) Any unit of local government within the State of
13Illinois may apply to the Director to have its employees,
14annuitants, and their dependents provided group health
15coverage under this Act on a non-insured basis. To participate,
16a unit of local government must agree to enroll all of its
17employees, who may select coverage under either the State group
18health benefits plan or a health maintenance organization that
19has contracted with the State to be available as a health care
20provider for employees as defined in this Act. A unit of local
21government must remit the entire cost of providing coverage
22under the State group health benefits plan or, for coverage
23under a health maintenance organization, an amount determined
24by the Director based on an analysis of the sex, age,
25geographic location, or other relevant demographic variables
26for its employees, except that the unit of local government

 

 

10000SB0011sam003- 34 -LRB100 06001 RPS 21154 a

1shall not be required to enroll those of its employees who are
2covered spouses or dependents under this plan or another group
3policy or plan providing health benefits as long as (1) an
4appropriate official from the unit of local government attests
5that each employee not enrolled is a covered spouse or
6dependent under this plan or another group policy or plan, and
7(2) at least 50% of the employees are enrolled and the unit of
8local government remits the entire cost of providing coverage
9to those employees, except that a participating school district
10must have enrolled at least 50% of its full-time employees who
11have not waived coverage under the district's group health plan
12by participating in a component of the district's cafeteria
13plan. A participating school district is not required to enroll
14a full-time employee who has waived coverage under the
15district's health plan, provided that an appropriate official
16from the participating school district attests that the
17full-time employee has waived coverage by participating in a
18component of the district's cafeteria plan. For the purposes of
19this subsection, "participating school district" includes a
20unit of local government whose primary purpose is education as
21defined by the Department's rules.
22    Employees of a participating unit of local government who
23are not enrolled due to coverage under another group health
24policy or plan may enroll in the event of a qualifying change
25in status, special enrollment, special circumstance as defined
26by the Director, or during the annual Benefit Choice Period. A

 

 

10000SB0011sam003- 35 -LRB100 06001 RPS 21154 a

1participating unit of local government may also elect to cover
2its annuitants. Dependent coverage shall be offered on an
3optional basis, with the costs paid by the unit of local
4government, its employees, or some combination of the two as
5determined by the unit of local government. The unit of local
6government shall be responsible for timely collection and
7transmission of dependent premiums.
8    The Director shall annually determine monthly rates of
9payment, subject to the following constraints:
10        (1) In the first year of coverage, the rates shall be
11    equal to the amount normally charged to State employees for
12    elected optional coverages or for enrolled dependents
13    coverages or other contributory coverages, or contributed
14    by the State for basic insurance coverages on behalf of its
15    employees, adjusted for differences between State
16    employees and employees of the local government in age,
17    sex, geographic location or other relevant demographic
18    variables, plus an amount sufficient to pay for the
19    additional administrative costs of providing coverage to
20    employees of the unit of local government and their
21    dependents.
22        (2) In subsequent years, a further adjustment shall be
23    made to reflect the actual prior years' claims experience
24    of the employees of the unit of local government.
25    In the case of coverage of local government employees under
26a health maintenance organization, the Director shall annually

 

 

10000SB0011sam003- 36 -LRB100 06001 RPS 21154 a

1determine for each participating unit of local government the
2maximum monthly amount the unit may contribute toward that
3coverage, based on an analysis of (i) the age, sex, geographic
4location, and other relevant demographic variables of the
5unit's employees and (ii) the cost to cover those employees
6under the State group health benefits plan. The Director may
7similarly determine the maximum monthly amount each unit of
8local government may contribute toward coverage of its
9employees' dependents under a health maintenance organization.
10    Monthly payments by the unit of local government or its
11employees for group health benefits plan or health maintenance
12organization coverage shall be deposited in the Local
13Government Health Insurance Reserve Fund.
14    The Local Government Health Insurance Reserve Fund is
15hereby created as a nonappropriated trust fund to be held
16outside the State Treasury, with the State Treasurer as
17custodian. The Local Government Health Insurance Reserve Fund
18shall be a continuing fund not subject to fiscal year
19limitations. The Local Government Health Insurance Reserve
20Fund is not subject to administrative charges or charge-backs,
21including but not limited to those authorized under Section 8h
22of the State Finance Act. All revenues arising from the
23administration of the health benefits program established
24under this Section shall be deposited into the Local Government
25Health Insurance Reserve Fund. Any interest earned on moneys in
26the Local Government Health Insurance Reserve Fund shall be

 

 

10000SB0011sam003- 37 -LRB100 06001 RPS 21154 a

1deposited into the Fund. All expenditures from this Fund shall
2be used for payments for health care benefits for local
3government and rehabilitation facility employees, annuitants,
4and dependents, and to reimburse the Department or its
5administrative service organization for all expenses incurred
6in the administration of benefits. No other State funds may be
7used for these purposes.
8    A local government employer's participation or desire to
9participate in a program created under this subsection shall
10not limit that employer's duty to bargain with the
11representative of any collective bargaining unit of its
12employees.
13    (j) Any rehabilitation facility within the State of
14Illinois may apply to the Director to have its employees,
15annuitants, and their eligible dependents provided group
16health coverage under this Act on a non-insured basis. To
17participate, a rehabilitation facility must agree to enroll all
18of its employees and remit the entire cost of providing such
19coverage for its employees, except that the rehabilitation
20facility shall not be required to enroll those of its employees
21who are covered spouses or dependents under this plan or
22another group policy or plan providing health benefits as long
23as (1) an appropriate official from the rehabilitation facility
24attests that each employee not enrolled is a covered spouse or
25dependent under this plan or another group policy or plan, and
26(2) at least 50% of the employees are enrolled and the

 

 

10000SB0011sam003- 38 -LRB100 06001 RPS 21154 a

1rehabilitation facility remits the entire cost of providing
2coverage to those employees. Employees of a participating
3rehabilitation facility who are not enrolled due to coverage
4under another group health policy or plan may enroll in the
5event of a qualifying change in status, special enrollment,
6special circumstance as defined by the Director, or during the
7annual Benefit Choice Period. A participating rehabilitation
8facility may also elect to cover its annuitants. Dependent
9coverage shall be offered on an optional basis, with the costs
10paid by the rehabilitation facility, its employees, or some
11combination of the 2 as determined by the rehabilitation
12facility. The rehabilitation facility shall be responsible for
13timely collection and transmission of dependent premiums.
14    The Director shall annually determine quarterly rates of
15payment, subject to the following constraints:
16        (1) In the first year of coverage, the rates shall be
17    equal to the amount normally charged to State employees for
18    elected optional coverages or for enrolled dependents
19    coverages or other contributory coverages on behalf of its
20    employees, adjusted for differences between State
21    employees and employees of the rehabilitation facility in
22    age, sex, geographic location or other relevant
23    demographic variables, plus an amount sufficient to pay for
24    the additional administrative costs of providing coverage
25    to employees of the rehabilitation facility and their
26    dependents.

 

 

10000SB0011sam003- 39 -LRB100 06001 RPS 21154 a

1        (2) In subsequent years, a further adjustment shall be
2    made to reflect the actual prior years' claims experience
3    of the employees of the rehabilitation facility.
4    Monthly payments by the rehabilitation facility or its
5employees for group health benefits shall be deposited in the
6Local Government Health Insurance Reserve Fund.
7    (k) Any domestic violence shelter or service within the
8State of Illinois may apply to the Director to have its
9employees, annuitants, and their dependents provided group
10health coverage under this Act on a non-insured basis. To
11participate, a domestic violence shelter or service must agree
12to enroll all of its employees and pay the entire cost of
13providing such coverage for its employees. The domestic
14violence shelter shall not be required to enroll those of its
15employees who are covered spouses or dependents under this plan
16or another group policy or plan providing health benefits as
17long as (1) an appropriate official from the domestic violence
18shelter attests that each employee not enrolled is a covered
19spouse or dependent under this plan or another group policy or
20plan and (2) at least 50% of the employees are enrolled and the
21domestic violence shelter remits the entire cost of providing
22coverage to those employees. Employees of a participating
23domestic violence shelter who are not enrolled due to coverage
24under another group health policy or plan may enroll in the
25event of a qualifying change in status, special enrollment, or
26special circumstance as defined by the Director or during the

 

 

10000SB0011sam003- 40 -LRB100 06001 RPS 21154 a

1annual Benefit Choice Period. A participating domestic
2violence shelter may also elect to cover its annuitants.
3Dependent coverage shall be offered on an optional basis, with
4employees, or some combination of the 2 as determined by the
5domestic violence shelter or service. The domestic violence
6shelter or service shall be responsible for timely collection
7and transmission of dependent premiums.
8    The Director shall annually determine rates of payment,
9subject to the following constraints:
10        (1) In the first year of coverage, the rates shall be
11    equal to the amount normally charged to State employees for
12    elected optional coverages or for enrolled dependents
13    coverages or other contributory coverages on behalf of its
14    employees, adjusted for differences between State
15    employees and employees of the domestic violence shelter or
16    service in age, sex, geographic location or other relevant
17    demographic variables, plus an amount sufficient to pay for
18    the additional administrative costs of providing coverage
19    to employees of the domestic violence shelter or service
20    and their dependents.
21        (2) In subsequent years, a further adjustment shall be
22    made to reflect the actual prior years' claims experience
23    of the employees of the domestic violence shelter or
24    service.
25    Monthly payments by the domestic violence shelter or
26service or its employees for group health insurance shall be

 

 

10000SB0011sam003- 41 -LRB100 06001 RPS 21154 a

1deposited in the Local Government Health Insurance Reserve
2Fund.
3    (l) A public community college or entity organized pursuant
4to the Public Community College Act may apply to the Director
5initially to have only annuitants not covered prior to July 1,
61992 by the district's health plan provided health coverage
7under this Act on a non-insured basis. The community college
8must execute a 2-year contract to participate in the Local
9Government Health Plan. Any annuitant may enroll in the event
10of a qualifying change in status, special enrollment, special
11circumstance as defined by the Director, or during the annual
12Benefit Choice Period.
13    The Director shall annually determine monthly rates of
14payment subject to the following constraints: for those
15community colleges with annuitants only enrolled, first year
16rates shall be equal to the average cost to cover claims for a
17State member adjusted for demographics, Medicare
18participation, and other factors; and in the second year, a
19further adjustment of rates shall be made to reflect the actual
20first year's claims experience of the covered annuitants.
21    (l-5) The provisions of subsection (l) become inoperative
22on July 1, 1999.
23    (m) The Director shall adopt any rules deemed necessary for
24implementation of this amendatory Act of 1989 (Public Act
2586-978).
26    (n) Any child advocacy center within the State of Illinois

 

 

10000SB0011sam003- 42 -LRB100 06001 RPS 21154 a

1may apply to the Director to have its employees, annuitants,
2and their dependents provided group health coverage under this
3Act on a non-insured basis. To participate, a child advocacy
4center must agree to enroll all of its employees and pay the
5entire cost of providing coverage for its employees. The child
6advocacy center shall not be required to enroll those of its
7employees who are covered spouses or dependents under this plan
8or another group policy or plan providing health benefits as
9long as (1) an appropriate official from the child advocacy
10center attests that each employee not enrolled is a covered
11spouse or dependent under this plan or another group policy or
12plan and (2) at least 50% of the employees are enrolled and the
13child advocacy center remits the entire cost of providing
14coverage to those employees. Employees of a participating child
15advocacy center who are not enrolled due to coverage under
16another group health policy or plan may enroll in the event of
17a qualifying change in status, special enrollment, or special
18circumstance as defined by the Director or during the annual
19Benefit Choice Period. A participating child advocacy center
20may also elect to cover its annuitants. Dependent coverage
21shall be offered on an optional basis, with the costs paid by
22the child advocacy center, its employees, or some combination
23of the 2 as determined by the child advocacy center. The child
24advocacy center shall be responsible for timely collection and
25transmission of dependent premiums.
26    The Director shall annually determine rates of payment,

 

 

10000SB0011sam003- 43 -LRB100 06001 RPS 21154 a

1subject to the following constraints:
2        (1) In the first year of coverage, the rates shall be
3    equal to the amount normally charged to State employees for
4    elected optional coverages or for enrolled dependents
5    coverages or other contributory coverages on behalf of its
6    employees, adjusted for differences between State
7    employees and employees of the child advocacy center in
8    age, sex, geographic location, or other relevant
9    demographic variables, plus an amount sufficient to pay for
10    the additional administrative costs of providing coverage
11    to employees of the child advocacy center and their
12    dependents.
13        (2) In subsequent years, a further adjustment shall be
14    made to reflect the actual prior years' claims experience
15    of the employees of the child advocacy center.
16    Monthly payments by the child advocacy center or its
17employees for group health insurance shall be deposited into
18the Local Government Health Insurance Reserve Fund.
19(Source: P.A. 97-695, eff. 7-1-12; 98-488, eff. 8-16-13.)
 
20    Section 15. The Civil Administrative Code of Illinois is
21amended by adding Section 5-647 as follows:
 
22    (20 ILCS 5/5-647 new)
23    Sec. 5-647. Future increases in income. A Department must
24not pay, offer, or agree to pay any future increase in income,

 

 

10000SB0011sam003- 44 -LRB100 06001 RPS 21154 a

1as that term is defined in Section 15-112.1 or 16-121.1 of the
2Illinois Pension Code, to any person in a manner that violates
3Section 15-132.9 or 16-122.9 of the Illinois Pension Code.
 
4    Section 20. The Illinois Pension Code is amended by
5changing Sections 2-101, 2-105, 2-107, 2-108, 2-119.1, 2-124,
62-126, 2-134, 2-162, 14-131, 14-135.08, 14-152.1, 15-108.1,
715-111, 15-136, 15-155, 15-157, 15-165, 15-198, 16-121,
816-133.1, 16-136.1, 16-152, 16-158, 16-203, 17-116, 17-119.2,
917-129, 17-130, 18-131, 18-140, 20-121, 20-123, 20-124, and
1020-125 and by adding Sections 2-105.3, 2-107.9, 2-107.10,
112-110.3, 2-165.1, 2-166.1, 14-147.5, 15-112.1, 15-112.2,
1215-132.9, 15-185.5, 15-200.1, 15-201.1, 16-107.1, 16-121.1,
1316-121.2, 16-122.9, 16-190.5, 16-205.1, 16-206.1, 17-106.05,
1417-113.4, 17-113.5, 17-113.6, and 17-115.5 as follows:
 
15    (40 ILCS 5/2-101)  (from Ch. 108 1/2, par. 2-101)
16    Sec. 2-101. Creation of system. A retirement system is
17created to provide retirement annuities, survivor's annuities
18and other benefits for certain members of the General Assembly,
19certain elected state officials, and their beneficiaries.
20    The system shall be known as the "General Assembly
21Retirement System". All its funds and property shall be a trust
22separate from all other entities, maintained for the purpose of
23securing payment of annuities and benefits under this Article.
24    Participation in the retirement system created under this

 

 

10000SB0011sam003- 45 -LRB100 06001 RPS 21154 a

1Article is restricted to persons who became participants before
2the effective date of this amendatory Act of the 100th General
3Assembly. Beginning on that date, the System shall not accept
4any new participants.
5(Source: P.A. 83-1440.)
 
6    (40 ILCS 5/2-105)  (from Ch. 108 1/2, par. 2-105)
7    Sec. 2-105. Member. "Member": Members of the General
8Assembly of this State, including persons who enter military
9service while a member of the General Assembly, and any person
10serving as Governor, Lieutenant Governor, Secretary of State,
11Treasurer, Comptroller, or Attorney General for the period of
12service in such office.
13    Any person who has served for 10 or more years as Clerk or
14Assistant Clerk of the House of Representatives, Secretary or
15Assistant Secretary of the Senate, or any combination thereof,
16may elect to become a member of this system while thenceforth
17engaged in such service by filing a written election with the
18board. Any person so electing shall be deemed an active member
19of the General Assembly for the purpose of validating and
20transferring any service credits earned under any of the funds
21and systems established under Articles 3 through 18 of this
22Code.
23    However, notwithstanding any other provision of this
24Article, a person shall not be deemed a member for the purposes
25of this Article unless he or she became a participant of the

 

 

10000SB0011sam003- 46 -LRB100 06001 RPS 21154 a

1System before the effective date of this amendatory Act of the
2100th General Assembly.
3(Source: P.A. 85-1008.)
 
4    (40 ILCS 5/2-105.3 new)
5    Sec. 2-105.3. Tier 1 employee. "Tier 1 employee": A
6participant who first became a participant before January 1,
72011.
 
8    (40 ILCS 5/2-107)  (from Ch. 108 1/2, par. 2-107)
9    Sec. 2-107. Participant. "Participant": Any member who
10elects to participate; and any former member who elects to
11continue participation under Section 2-117.1, for the duration
12of such continued participation. However, notwithstanding any
13other provision of this Article, a person shall not be deemed a
14participant for the purposes of this Article unless he or she
15became a participant of the System before the effective date of
16this amendatory Act of the 100th General Assembly.
17(Source: P.A. 86-1488.)
 
18    (40 ILCS 5/2-107.9 new)
19    Sec. 2-107.9. Future increase in income. "Future increase
20in income" means an increase to a Tier 1 employee's base pay
21that is offered to the Tier 1 employee for service under this
22Article after June 30, 2018 that qualifies as "salary", as
23defined in Section 2-108, or would qualify as "salary" but for

 

 

10000SB0011sam003- 47 -LRB100 06001 RPS 21154 a

1the fact that it was offered to and accepted by the Tier 1
2employee under the condition set forth in subsection (c) of
3Section 2-110.3.
 
4    (40 ILCS 5/2-107.10 new)
5    Sec. 2-107.10. Base pay. As used in Section 2-107.9 of
6this Code, "base pay" means the Tier 1 employee's annualized
7rate of salary as of June 30, 2018. For a person returning to
8active service as a Tier 1 employee after June 30, 2018,
9however, "base pay" means the employee's annualized rate of
10salary as of the employee's last date of service prior to July
111, 2018. The System shall calculate the base pay of each Tier 1
12employee pursuant to this Section.
 
13    (40 ILCS 5/2-108)  (from Ch. 108 1/2, par. 2-108)
14    (Text of Section WITHOUT the changes made by P.A. 98-599,
15which has been held unconstitutional)
16    Sec. 2-108. Salary. "Salary":
17    (1) For members of the General Assembly, the total
18compensation paid to the member by the State for one year of
19service, including the additional amounts, if any, paid to the
20member as an officer pursuant to Section 1 of "An Act in
21relation to the compensation and emoluments of the members of
22the General Assembly", approved December 6, 1907, as now or
23hereafter amended.
24    (2) For the State executive officers specified in Section

 

 

10000SB0011sam003- 48 -LRB100 06001 RPS 21154 a

12-105, the total compensation paid to the member for one year
2of service.
3    (3) For members of the System who are participants under
4Section 2-117.1, or who are serving as Clerk or Assistant Clerk
5of the House of Representatives or Secretary or Assistant
6Secretary of the Senate, the total compensation paid to the
7member for one year of service, but not to exceed the salary of
8the highest salaried officer of the General Assembly.
9    However, in the event that federal law results in any
10participant receiving imputed income based on the value of
11group term life insurance provided by the State, such imputed
12income shall not be included in salary for the purposes of this
13Article.
14    Notwithstanding any other provision of this Section,
15"salary" does not include any future increase in income that is
16offered for service to a Tier 1 employee under this Article
17pursuant to the condition set forth in subsection (c) of
18Section 2-110.3 and accepted under that condition by a Tier 1
19employee who has made the election under paragraph (2) of
20subsection (a) of Section 2-110.3.
21    Notwithstanding any other provision of this Section,
22"salary" does not include any consideration payment made to a
23Tier 1 employee.
24(Source: P.A. 86-27; 86-273; 86-1028; 86-1488.)
 
25    (40 ILCS 5/2-110.3 new)

 

 

10000SB0011sam003- 49 -LRB100 06001 RPS 21154 a

1    Sec. 2-110.3. Election by Tier 1 employees.
2    (a) Each active Tier 1 employee shall make an irrevocable
3election either:
4        (1) to agree to delay his or her eligibility for
5    automatic annual increases in retirement annuity as
6    provided in subsection (a-1) of Section 2-119.1 and to have
7    the amount of the automatic annual increases in his or her
8    retirement annuity and survivor's annuity that are
9    otherwise provided for in this Article calculated,
10    instead, as provided in subsection (a-1) of Section
11    2-119.1; or
12        (2) to not agree to paragraph (1) of this subsection.
13    The election required under this subsection (a) shall be
14made by each active Tier 1 employee no earlier than January 1,
152018 and no later than March 31, 2018, except that a person who
16returns to active service as a Tier 1 employee under this
17Article on or after January 1, 2018 and has not yet made an
18election under this Section must make the election under this
19subsection (a) within 60 days after returning to active service
20as a Tier 1 employee.
21    If a Tier 1 employee fails for any reason to make a
22required election under this subsection within the time
23specified, then the employee shall be deemed to have made the
24election under paragraph (2) of this subsection.
25    (a-5) If this Section is enjoined or stayed by an Illinois
26court or a court of competent jurisdiction pending the entry of

 

 

10000SB0011sam003- 50 -LRB100 06001 RPS 21154 a

1a final and unappealable decision, and this Section is
2determined to be constitutional or otherwise valid by a final
3unappealable decision of an Illinois court or a court of
4competent jurisdiction, then the election procedure set forth
5in subsection (a) of this Section shall commence on the 180th
6calendar day after the date of the issuance of the final
7unappealable decision and shall conclude at the end of the
8270th calendar day after that date.
9    (a-10) All elections under subsection (a) that are made or
10deemed to be made before July 1, 2018 shall take effect on July
111, 2018. Elections that are made or deemed to be made on or
12after July 1, 2018 shall take effect on the first day of the
13month following the month in which the election is made or
14deemed to be made.
15    (b) As adequate and legal consideration provided under this
16amendatory Act of the 100th General Assembly for making an
17election under paragraph (1) of subsection (a) of this Section,
18the State of Illinois shall be expressly and irrevocably
19prohibited from offering any future increases in income to a
20Tier 1 employee who has made an election under paragraph (1) of
21subsection (a) of this Section on the condition of not
22constituting salary under Section 2-108.
23    As adequate and legal consideration provided under this
24amendatory Act of the 100th General Assembly for making an
25election under paragraph (1) of subsection (a) of this Section,
26each Tier 1 employee who has made an election under paragraph

 

 

10000SB0011sam003- 51 -LRB100 06001 RPS 21154 a

1(1) of subsection (a) of this Section shall receive a
2consideration payment equal to 10% of the contributions made by
3or on behalf of the employee under Section 2-126 before the
4effective date of that election. The State Comptroller shall
5pay the consideration payment to the Tier 1 employee out of
6funds appropriated for that purpose under Section 1.9 of the
7State Pension Funds Continuing Appropriation Act. The System
8shall calculate the amount of each consideration payment and,
9by July 1, 2018, shall certify to the State Comptroller the
10amount of the consideration payment, together with the name,
11address, and any other available payment information of the
12Tier 1 employee as found in the records of the System. The
13System shall make additional calculations and certifications
14of consideration payments to the State Comptroller as the
15System deems necessary.
16    (c) A Tier 1 employee who makes the election under
17paragraph (2) of subsection (a) of this Section shall not be
18subject to paragraph (1) of subsection (a) of this Section.
19However, each future increase in income offered for service as
20a member under this Article to a Tier 1 employee who has made
21the election under paragraph (2) of subsection (a) of this
22Section shall be offered expressly and irrevocably on the
23condition of not constituting salary under Section 2-108 and
24that the Tier 1 employee's acceptance of the offered future
25increase in income shall constitute his or her agreement to
26that condition.

 

 

10000SB0011sam003- 52 -LRB100 06001 RPS 21154 a

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

 

 

10000SB0011sam003- 53 -LRB100 06001 RPS 21154 a

1may also wish to obtain information and counsel relating to the
2election required under this Section from any other available
3source, including, but not limited to, labor organizations and
4private counsel.
5    In no event shall the System, its staff, or the Board be
6held liable for any information given to a member regarding the
7elections under this Section. The System shall coordinate with
8the Illinois Department of Central Management Services and each
9other retirement system administering an election in
10accordance with this amendatory Act of the 100th General
11Assembly to provide information concerning the impact of the
12election set forth in this Section.
13    (e) Notwithstanding any other provision of law, each future
14increase in income offered by the State of Illinois for service
15as a member must be offered expressly and irrevocably on the
16condition of not constituting "salary" under Section 2-108 to
17any Tier 1 employee who has made an election under paragraph
18(2) of subsection (a) of this Section. The offer shall also
19provide that the Tier 1 employee's acceptance of the offered
20future increase in income shall constitute his or her agreement
21to the condition set forth in this subsection.
22    For purposes of legislative intent, the condition set forth
23in this subsection shall be construed in a manner that ensures
24that the condition is not violated or circumvented through any
25contrivance of any kind.
26    (f) A member's election under this Section is not a

 

 

10000SB0011sam003- 54 -LRB100 06001 RPS 21154 a

1prohibited election under subdivision (j)(1) of Section 1-119
2of this Code.
3    (g) No provision of this Section shall be interpreted in a
4way that would cause the System to cease to be a qualified plan
5under Section 401(a) of the Internal Revenue Code of 1986. The
6provisions of this Section shall be subject to and implemented
7in a manner that complies with Section 11 of Article IV of the
8Illinois Constitution.
9    (h) If an election created by this amendatory Act in any
10other Article of this Code or any change deriving from that
11election is determined to be unconstitutional or otherwise
12invalid by a final unappealable decision of an Illinois court
13or a court of competent jurisdiction, the invalidity of that
14provision shall not in any way affect the validity of this
15Section or the changes deriving from the election required
16under this Section.
 
17    (40 ILCS 5/2-119.1)  (from Ch. 108 1/2, par. 2-119.1)
18    (Text of Section WITHOUT the changes made by P.A. 98-599,
19which has been held unconstitutional)
20    Sec. 2-119.1. Automatic increase in retirement annuity.
21    (a) Except as provided in subsection (a-1), a A participant
22who retires after June 30, 1967, and who has not received an
23initial increase under this Section before the effective date
24of this amendatory Act of 1991, shall, in January or July next
25following the first anniversary of retirement, whichever

 

 

10000SB0011sam003- 55 -LRB100 06001 RPS 21154 a

1occurs first, and in the same month of each year thereafter,
2but in no event prior to age 60, have the amount of the
3originally granted retirement annuity increased as follows:
4for each year through 1971, 1 1/2%; for each year from 1972
5through 1979, 2%; and for 1980 and each year thereafter, 3%.
6Annuitants who have received an initial increase under this
7subsection prior to the effective date of this amendatory Act
8of 1991 shall continue to receive their annual increases in the
9same month as the initial increase.
10    (a-1) Notwithstanding any other provision of this Article,
11for a Tier 1 employee who made the election under paragraph (1)
12of subsection (a) of Section 2-110.3:
13        (1) The initial increase in retirement annuity under
14    this Section shall occur on the January 1 occurring either
15    on or after the attainment of age 67 or the fifth
16    anniversary of the annuity start date, whichever is
17    earlier.
18        (2) The amount of each automatic annual increase in
19    retirement annuity or survivor's annuity occurring on or
20    after the effective date of that election shall be
21    calculated as a percentage of the originally granted
22    retirement annuity or survivor's annuity, equal to 3% or
23    one-half the annual unadjusted percentage increase (but
24    not less than zero) in the consumer price index-u for the
25    12 months ending with the September preceding each November
26    1, whichever is less. If the annual unadjusted percentage

 

 

10000SB0011sam003- 56 -LRB100 06001 RPS 21154 a

1    change in the consumer price index-u for the 12 months
2    ending with the September preceding each November 1 is zero
3    or there is a decrease, then the annuity shall not be
4    increased.
5    For the purposes of this Section, "consumer price index-u"
6means the index published by the Bureau of Labor Statistics of
7the United States Department of Labor that measures the average
8change in prices of goods and services purchased by all urban
9consumers, United States city average, all items, 1982-84 =
10100. The new amount resulting from each annual adjustment shall
11be determined by the Public Pension Division of the Department
12of Insurance and made available to the board of the retirement
13system by November 1 of each year.
14    (b) Beginning January 1, 1990, for eligible participants
15who remain in service after attaining 20 years of creditable
16service, the 3% increases provided under subsection (a) shall
17begin to accrue on the January 1 next following the date upon
18which the participant (1) attains age 55, or (2) attains 20
19years of creditable service, whichever occurs later, and shall
20continue to accrue while the participant remains in service;
21such increases shall become payable on January 1 or July 1,
22whichever occurs first, next following the first anniversary of
23retirement. For any person who has service credit in the System
24for the entire period from January 15, 1969 through December
2531, 1992, regardless of the date of termination of service, the
26reference to age 55 in clause (1) of this subsection (b) shall

 

 

10000SB0011sam003- 57 -LRB100 06001 RPS 21154 a

1be deemed to mean age 50.
2    This subsection (b) does not apply to any person who first
3becomes a member of the System after August 8, 2003 (the
4effective date of Public Act 93-494) this amendatory Act of the
593rd General Assembly.
6    (b-5) Notwithstanding any other provision of this Article,
7a participant who first becomes a participant on or after
8January 1, 2011 (the effective date of Public Act 96-889)
9shall, in January or July next following the first anniversary
10of retirement, whichever occurs first, and in the same month of
11each year thereafter, but in no event prior to age 67, have the
12amount of the retirement annuity then being paid increased by
133% or the annual unadjusted percentage increase in the Consumer
14Price Index for All Urban Consumers as determined by the Public
15Pension Division of the Department of Insurance under
16subsection (a) of Section 2-108.1, whichever is less.
17    (c) The foregoing provisions relating to automatic
18increases are not applicable to a participant who retires
19before having made contributions (at the rate prescribed in
20Section 2-126) for automatic increases for less than the
21equivalent of one full year. However, in order to be eligible
22for the automatic increases, such a participant may make
23arrangements to pay to the system the amount required to bring
24the total contributions for the automatic increase to the
25equivalent of one year's contributions based upon his or her
26last salary.

 

 

10000SB0011sam003- 58 -LRB100 06001 RPS 21154 a

1    (d) A participant who terminated service prior to July 1,
21967, with at least 14 years of service is entitled to an
3increase in retirement annuity beginning January, 1976, and to
4additional increases in January of each year thereafter.
5    The initial increase shall be 1 1/2% of the originally
6granted retirement annuity multiplied by the number of full
7years that the annuitant was in receipt of such annuity prior
8to January 1, 1972, plus 2% of the originally granted
9retirement annuity for each year after that date. The
10subsequent annual increases shall be at the rate of 2% of the
11originally granted retirement annuity for each year through
121979 and at the rate of 3% for 1980 and thereafter.
13    (e) Beginning January 1, 1990, and except as provided in
14subsection (a-1), all automatic annual increases payable under
15this Section shall be calculated as a percentage of the total
16annuity payable at the time of the increase, including previous
17increases granted under this Article.
18(Source: P.A. 96-889, eff. 1-1-11; 96-1490, eff. 1-1-11.)
 
19    (40 ILCS 5/2-124)  (from Ch. 108 1/2, par. 2-124)
20    (Text of Section WITHOUT the changes made by P.A. 98-599,
21which has been held unconstitutional)
22    Sec. 2-124. Contributions by State.
23    (a) The State shall make contributions to the System by
24appropriations of amounts which, together with the
25contributions of participants, interest earned on investments,

 

 

10000SB0011sam003- 59 -LRB100 06001 RPS 21154 a

1and other income will meet the cost of maintaining and
2administering the System on a 90% funded basis in accordance
3with actuarial recommendations.
4    (b) The Board shall determine the amount of State
5contributions required for each fiscal year on the basis of the
6actuarial tables and other assumptions adopted by the Board and
7the prescribed rate of interest, using the formula in
8subsection (c).
9    (c) For State fiscal years 2018 through 2045 (except as
10otherwise provided for fiscal year 2019), the minimum
11contribution to the System to be made by the State for each
12fiscal year shall be an amount determined by the System to be
13sufficient to bring the total assets of the System up to 90% of
14the total actuarial liabilities of the System by the end of
15State fiscal year 2045. In making these determinations, the
16required State contribution shall be calculated each year as a
17level percentage of total payroll, including payroll that is
18not deemed pensionable, but excluding payroll attributable to
19participants in the defined contribution plan under Section
202-165.1, over the years remaining to and including fiscal year
212045 and shall be determined under the projected unit credit
22actuarial cost method.
23    For State fiscal year 2019:
24        (1) The initial calculation and certification shall be
25    based on the amount determined above.
26        (2) For purposes of the recertification due on or

 

 

10000SB0011sam003- 60 -LRB100 06001 RPS 21154 a

1    before May 1, 2018, the recalculation of the required State
2    contribution for fiscal year 2019 shall take into account
3    the effect on the System's liabilities of the elections
4    made under Section 2-110.3.
5        (3) For purposes of the recertification due on or
6    before October 1, 2018, the total required State
7    contribution for fiscal year 2019 shall be reduced by the
8    amount of the consideration payments made to Tier 1
9    employees who made the election under paragraph (1) of
10    subsection (a) of Section 2-110.3.
11    Beginning in State fiscal year 2018, any increase or
12decrease in State contribution over the prior fiscal year due
13exclusively to changes in actuarial or investment assumptions
14adopted by the Board shall be included in the State
15contribution to the System, as a percentage of the applicable
16employee payroll, and shall be increased in equal annual
17increments so that by the State fiscal year occurring 5 years
18after the adoption of the actuarial or investment assumptions,
19the State is contributing at the rate otherwise required under
20this Section.
21    If Section 2-110.3 is determined to be unconstitutional or
22otherwise invalid by a final unappealable decision of an
23Illinois court or a court of competent jurisdiction, then the
24changes made to this Section by this amendatory Act of the
25100th General Assembly shall not take effect and are repealed
26by operation of law.

 

 

10000SB0011sam003- 61 -LRB100 06001 RPS 21154 a

1    For State fiscal years 2012 through 2017 2045, the minimum
2contribution to the System to be made by the State for each
3fiscal year shall be an amount determined by the System to be
4sufficient to bring the total assets of the System up to 90% of
5the total actuarial liabilities of the System by the end of
6State fiscal year 2045. In making these determinations, the
7required State contribution shall be calculated each year as a
8level percentage of payroll over the years remaining to and
9including fiscal year 2045 and shall be determined under the
10projected unit credit actuarial cost method.
11    For State fiscal years 1996 through 2005, the State
12contribution to the System, as a percentage of the applicable
13employee payroll, shall be increased in equal annual increments
14so that by State fiscal year 2011, the State is contributing at
15the rate required under this Section.
16    Notwithstanding any other provision of this Article, the
17total required State contribution for State fiscal year 2006 is
18$4,157,000.
19    Notwithstanding any other provision of this Article, the
20total required State contribution for State fiscal year 2007 is
21$5,220,300.
22    For each of State fiscal years 2008 through 2009, the State
23contribution to the System, as a percentage of the applicable
24employee payroll, shall be increased in equal annual increments
25from the required State contribution for State fiscal year
262007, so that by State fiscal year 2011, the State is

 

 

10000SB0011sam003- 62 -LRB100 06001 RPS 21154 a

1contributing at the rate otherwise required under this Section.
2    Notwithstanding any other provision of this Article, the
3total required State contribution for State fiscal year 2010 is
4$10,454,000 and shall be made from the proceeds of bonds sold
5in fiscal year 2010 pursuant to Section 7.2 of the General
6Obligation Bond Act, less (i) the pro rata share of bond sale
7expenses determined by the System's share of total bond
8proceeds, (ii) any amounts received from the General Revenue
9Fund in fiscal year 2010, and (iii) any reduction in bond
10proceeds due to the issuance of discounted bonds, if
11applicable.
12    Notwithstanding any other provision of this Article, the
13total required State contribution for State fiscal year 2011 is
14the amount recertified by the System on or before April 1, 2011
15pursuant to Section 2-134 and shall be made from the proceeds
16of bonds sold in fiscal year 2011 pursuant to Section 7.2 of
17the General Obligation Bond Act, less (i) the pro rata share of
18bond sale expenses determined by the System's share of total
19bond proceeds, (ii) any amounts received from the General
20Revenue Fund in fiscal year 2011, and (iii) any reduction in
21bond proceeds due to the issuance of discounted bonds, if
22applicable.
23    Beginning in State fiscal year 2046, the minimum State
24contribution for each fiscal year shall be the amount needed to
25maintain the total assets of the System at 90% of the total
26actuarial liabilities of the System.

 

 

10000SB0011sam003- 63 -LRB100 06001 RPS 21154 a

1    Amounts received by the System pursuant to Section 25 of
2the Budget Stabilization Act or Section 8.12 of the State
3Finance Act in any fiscal year do not reduce and do not
4constitute payment of any portion of the minimum State
5contribution required under this Article in that fiscal year.
6Such amounts shall not reduce, and shall not be included in the
7calculation of, the required State contributions under this
8Article in any future year until the System has reached a
9funding ratio of at least 90%. A reference in this Article to
10the "required State contribution" or any substantially similar
11term does not include or apply to any amounts payable to the
12System under Section 25 of the Budget Stabilization Act.
13    Notwithstanding any other provision of this Section, the
14required State contribution for State fiscal year 2005 and for
15fiscal year 2008 and each fiscal year thereafter, as calculated
16under this Section and certified under Section 2-134, shall not
17exceed an amount equal to (i) the amount of the required State
18contribution that would have been calculated under this Section
19for that fiscal year if the System had not received any
20payments under subsection (d) of Section 7.2 of the General
21Obligation Bond Act, minus (ii) the portion of the State's
22total debt service payments for that fiscal year on the bonds
23issued in fiscal year 2003 for the purposes of that Section
247.2, as determined and certified by the Comptroller, that is
25the same as the System's portion of the total moneys
26distributed under subsection (d) of Section 7.2 of the General

 

 

10000SB0011sam003- 64 -LRB100 06001 RPS 21154 a

1Obligation Bond Act. In determining this maximum for State
2fiscal years 2008 through 2010, however, the amount referred to
3in item (i) shall be increased, as a percentage of the
4applicable employee payroll, in equal increments calculated
5from the sum of the required State contribution for State
6fiscal year 2007 plus the applicable portion of the State's
7total debt service payments for fiscal year 2007 on the bonds
8issued in fiscal year 2003 for the purposes of Section 7.2 of
9the General Obligation Bond Act, so that, by State fiscal year
102011, the State is contributing at the rate otherwise required
11under this Section.
12    (d) For purposes of determining the required State
13contribution to the System, the value of the System's assets
14shall be equal to the actuarial value of the System's assets,
15which shall be calculated as follows:
16    As of June 30, 2008, the actuarial value of the System's
17assets shall be equal to the market value of the assets as of
18that date. In determining the actuarial value of the System's
19assets for fiscal years after June 30, 2008, any actuarial
20gains or losses from investment return incurred in a fiscal
21year shall be recognized in equal annual amounts over the
225-year period following that fiscal year.
23    (e) For purposes of determining the required State
24contribution to the system for a particular year, the actuarial
25value of assets shall be assumed to earn a rate of return equal
26to the system's actuarially assumed rate of return.

 

 

10000SB0011sam003- 65 -LRB100 06001 RPS 21154 a

1(Source: P.A. 96-43, eff. 7-15-09; 96-1497, eff. 1-14-11;
296-1511, eff. 1-27-11; 96-1554, eff. 3-18-11; 97-813, eff.
37-13-12.)
 
4    (40 ILCS 5/2-126)  (from Ch. 108 1/2, par. 2-126)
5    (Text of Section WITHOUT the changes made by P.A. 98-599,
6which has been held unconstitutional)
7    Sec. 2-126. Contributions by participants.
8    (a) Each participant shall contribute toward the cost of
9his or her retirement annuity a percentage of each payment of
10salary received by him or her for service as a member as
11follows: for service between October 31, 1947 and January 1,
121959, 5%; for service between January 1, 1959 and June 30,
131969, 6%; for service between July 1, 1969 and January 10,
141973, 6 1/2%; for service after January 10, 1973, 7%; for
15service after December 31, 1981, 8 1/2%.
16    (b) Beginning August 2, 1949, each male participant, and
17from July 1, 1971, each female participant shall contribute
18towards the cost of the survivor's annuity 2% of salary.
19    A participant who has no eligible survivor's annuity
20beneficiary may elect to cease making contributions for
21survivor's annuity under this subsection. A survivor's annuity
22shall not be payable upon the death of a person who has made
23this election, unless prior to that death the election has been
24revoked and the amount of the contributions that would have
25been paid under this subsection in the absence of the election

 

 

10000SB0011sam003- 66 -LRB100 06001 RPS 21154 a

1is paid to the System, together with interest at the rate of 4%
2per year from the date the contributions would have been made
3to the date of payment.
4    (c) Beginning July 1, 1967, each participant shall
5contribute 1% of salary towards the cost of automatic increase
6in annuity provided in Section 2-119.1. These contributions
7shall be made concurrently with contributions for retirement
8annuity purposes.
9    (d) In addition, each participant serving as an officer of
10the General Assembly shall contribute, for the same purposes
11and at the same rates as are required of a regular participant,
12on each additional payment received as an officer. If the
13participant serves as an officer for at least 2 but less than 4
14years, he or she shall contribute an amount equal to the amount
15that would have been contributed had the participant served as
16an officer for 4 years. Persons who serve as officers in the
1787th General Assembly but cannot receive the additional payment
18to officers because of the ban on increases in salary during
19their terms may nonetheless make contributions based on those
20additional payments for the purpose of having the additional
21payments included in their highest salary for annuity purposes;
22however, persons electing to make these additional
23contributions must also pay an amount representing the
24corresponding employer contributions, as calculated by the
25System.
26    (e) Notwithstanding any other provision of this Article,

 

 

10000SB0011sam003- 67 -LRB100 06001 RPS 21154 a

1the required contribution of a participant who first becomes a
2participant on or after January 1, 2011 shall not exceed the
3contribution that would be due under this Article if that
4participant's highest salary for annuity purposes were
5$106,800, plus any increases in that amount under Section
62-108.1.
7    (f) Beginning July 1, 2018 or the effective date of the
8Tier 1 employee's election under paragraph (1) of subsection
9(a) of Section 2-110.3, whichever is later, in lieu of the
10contributions otherwise required under this Section, each Tier
111 employee who made the election under paragraph (1) of
12subsection (a) of Section 2-110.3 shall contribute 8.5% of each
13payment of salary toward the cost of his or her retirement
14annuity and 1.85% of each payment of salary toward the cost of
15the survivor's annuity.
16    (g) Notwithstanding subsection (f) of this Section,
17beginning July 1, 2018 or the effective date of the Tier 1
18employee's election under paragraph (1) of subsection (a) of
19Section 2-110.3, whichever is later, in lieu of the
20contributions otherwise required under this Section, each Tier
211 employee who made the election under paragraph (1) of
22subsection (a) of Section 2-110.3 and has elected to cease
23making contributions for survivor's annuity under subsection
24(b) of this Section, shall contribute 8.55% of each payment of
25salary toward the cost of his or her retirement annuity.
26(Source: P.A. 96-1490, eff. 1-1-11.)
 

 

 

10000SB0011sam003- 68 -LRB100 06001 RPS 21154 a

1    (40 ILCS 5/2-134)   (from Ch. 108 1/2, par. 2-134)
2    (Text of Section WITHOUT the changes made by P.A. 98-599,
3which has been held unconstitutional)
4    Sec. 2-134. To certify required State contributions and
5submit vouchers.
6    (a) The Board shall certify to the Governor on or before
7December 15 of each year until December 15, 2011 the amount of
8the required State contribution to the System for the next
9fiscal year and shall specifically identify the System's
10projected State normal cost for that fiscal year. The
11certification shall include a copy of the actuarial
12recommendations upon which it is based and shall specifically
13identify the System's projected State normal cost for that
14fiscal year.
15    On or before November 1 of each year, beginning November 1,
162012, the Board shall submit to the State Actuary, the
17Governor, and the General Assembly a proposed certification of
18the amount of the required State contribution to the System for
19the next fiscal year, along with all of the actuarial
20assumptions, calculations, and data upon which that proposed
21certification is based. On or before January 1 of each year
22beginning January 1, 2013, the State Actuary shall issue a
23preliminary report concerning the proposed certification and
24identifying, if necessary, recommended changes in actuarial
25assumptions that the Board must consider before finalizing its

 

 

10000SB0011sam003- 69 -LRB100 06001 RPS 21154 a

1certification of the required State contributions. On or before
2January 15, 2013 and every January 15 thereafter, the Board
3shall certify to the Governor and the General Assembly the
4amount of the required State contribution for the next fiscal
5year. The Board's certification must note any deviations from
6the State Actuary's recommended changes, the reason or reasons
7for not following the State Actuary's recommended changes, and
8the fiscal impact of not following the State Actuary's
9recommended changes on the required State contribution.
10    On or before May 1, 2004, the Board shall recalculate and
11recertify to the Governor the amount of the required State
12contribution to the System for State fiscal year 2005, taking
13into account the amounts appropriated to and received by the
14System under subsection (d) of Section 7.2 of the General
15Obligation Bond Act.
16    On or before July 1, 2005, the Board shall recalculate and
17recertify to the Governor the amount of the required State
18contribution to the System for State fiscal year 2006, taking
19into account the changes in required State contributions made
20by this amendatory Act of the 94th General Assembly.
21    On or before April 1, 2011, the Board shall recalculate and
22recertify to the Governor the amount of the required State
23contribution to the System for State fiscal year 2011, applying
24the changes made by Public Act 96-889 to the System's assets
25and liabilities as of June 30, 2009 as though Public Act 96-889
26was approved on that date.

 

 

10000SB0011sam003- 70 -LRB100 06001 RPS 21154 a

1    As soon as practical after the effective date of this
2amendatory Act of the 100th General Assembly, the State Actuary
3and the Board shall recalculate and recertify to the Governor
4and the General Assembly the amount of the State contribution
5to the System for State fiscal year 2018, taking into account
6the changes in required State contributions made by this
7amendatory Act of the 100th General Assembly.
8    On or before May 1, 2018, the Board shall recalculate and
9recertify to the Governor and the General Assembly the amount
10of the required State contribution to the System for State
11fiscal year 2019, taking into account the effect on the
12System's liabilities of the elections made under Section
132-110.3.
14    On or before October 1, 2018, the Board shall recalculate
15and recertify to the Governor and the General Assembly the
16amount of the required State contribution to the System for
17State fiscal year 2019, taking into account the reduction
18specified under item (3) of subsection (c) of Section 2-124.
19    (b) Beginning in State fiscal year 1996, on or as soon as
20possible after the 15th day of each month the Board shall
21submit vouchers for payment of State contributions to the
22System, in a total monthly amount of one-twelfth of the
23required annual State contribution certified under subsection
24(a). From the effective date of this amendatory Act of the 93rd
25General Assembly through June 30, 2004, the Board shall not
26submit vouchers for the remainder of fiscal year 2004 in excess

 

 

10000SB0011sam003- 71 -LRB100 06001 RPS 21154 a

1of the fiscal year 2004 certified contribution amount
2determined under this Section after taking into consideration
3the transfer to the System under subsection (d) of Section
46z-61 of the State Finance Act. These vouchers shall be paid by
5the State Comptroller and Treasurer by warrants drawn on the
6funds appropriated to the System for that fiscal year. If in
7any month the amount remaining unexpended from all other
8appropriations to the System for the applicable fiscal year
9(including the appropriations to the System under Section 8.12
10of the State Finance Act and Section 1 of the State Pension
11Funds Continuing Appropriation Act) is less than the amount
12lawfully vouchered under this Section, the difference shall be
13paid from the General Revenue Fund under the continuing
14appropriation authority provided in Section 1.1 of the State
15Pension Funds Continuing Appropriation Act.
16    (c) The full amount of any annual appropriation for the
17System for State fiscal year 1995 shall be transferred and made
18available to the System at the beginning of that fiscal year at
19the request of the Board. Any excess funds remaining at the end
20of any fiscal year from appropriations shall be retained by the
21System as a general reserve to meet the System's accrued
22liabilities.
23(Source: P.A. 96-1497, eff. 1-14-11; 96-1511, eff. 1-27-11;
2497-694, eff. 6-18-12.)
 
25    (40 ILCS 5/2-162)

 

 

10000SB0011sam003- 72 -LRB100 06001 RPS 21154 a

1    (Text of Section WITHOUT the changes made by P.A. 98-599,
2which has been held unconstitutional)
3    Sec. 2-162. Application and expiration of new benefit
4increases.
5    (a) As used in this Section, "new benefit increase" means
6an increase in the amount of any benefit provided under this
7Article, or an expansion of the conditions of eligibility for
8any benefit under this Article, that results from an amendment
9to this Code that takes effect after the effective date of this
10amendatory Act of the 94th General Assembly. "New benefit
11increase", however, does not include any benefit increase
12resulting from the changes made to this Article by this
13amendatory Act of the 100th General Assembly.
14    (b) Notwithstanding any other provision of this Code or any
15subsequent amendment to this Code, every new benefit increase
16is subject to this Section and shall be deemed to be granted
17only in conformance with and contingent upon compliance with
18the provisions of this Section.
19    (c) The Public Act enacting a new benefit increase must
20identify and provide for payment to the System of additional
21funding at least sufficient to fund the resulting annual
22increase in cost to the System as it accrues.
23    Every new benefit increase is contingent upon the General
24Assembly providing the additional funding required under this
25subsection. The Commission on Government Forecasting and
26Accountability shall analyze whether adequate additional

 

 

10000SB0011sam003- 73 -LRB100 06001 RPS 21154 a

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

 

 

10000SB0011sam003- 74 -LRB100 06001 RPS 21154 a

1apply and qualify for the affected benefit while the new
2benefit increase was in effect.
3(Source: P.A. 94-4, eff. 6-1-05.)
 
4    (40 ILCS 5/2-165.1 new)
5    Sec. 2-165.1. Defined contribution plan.
6    (a) By July 1, 2018, the System shall prepare and implement
7a voluntary defined contribution plan for up to 5% of eligible
8active Tier 1 employees. The System shall determine the 5% cap
9by the number of active Tier 1 employees on the effective date
10of this Section. The defined contribution plan developed under
11this Section shall be a plan that aggregates employer and
12employee contributions in individual participant accounts
13which, after meeting any other requirements, are used for
14payouts after retirement in accordance with this Section and
15any other applicable laws.
16    As used in this Section, "defined benefit plan" means the
17retirement plan available under this Article to Tier 1
18employees who have not made the election authorized under this
19Section.
20        (1) Under the defined contribution plan, an active Tier
21    1 employee of this System could elect to cease accruing
22    benefits in the defined benefit plan under this Article and
23    begin accruing benefits for future service in the defined
24    contribution plan. Service credit under the defined
25    contribution plan may be used for determining retirement

 

 

10000SB0011sam003- 75 -LRB100 06001 RPS 21154 a

1    eligibility under the defined benefit plan.
2        (2) Participants in the defined contribution plan
3    shall pay employee contributions at the same rate as Tier 1
4    employees in this System who do not participate in the
5    defined contribution plan.
6        (3) State contributions shall be paid into the accounts
7    of all participants in the defined contribution plan at a
8    uniform rate, expressed as a percentage of compensation and
9    determined for each year. This rate shall be no higher than
10    the employer's normal cost for Tier 1 employees in the
11    defined benefit plan for that year, as determined by the
12    System and expressed as a percentage of compensation, and
13    shall be no lower than 3% of compensation. The State shall
14    adjust this rate annually.
15        (4) The defined contribution plan shall require 5 years
16    of participation in the defined contribution plan before
17    vesting in State contributions. If the participant fails to
18    vest in them, the State contributions, and the earnings
19    thereon, shall be forfeited.
20        (5) The defined contribution plan may provide for
21    participants in the plan to be eligible for defined
22    disability benefits. If it does, the System shall reduce
23    the employee contributions credited to the participant's
24    defined contribution plan account by an amount determined
25    by the System to cover the cost of offering such benefits.
26        (6) The defined contribution plan shall provide a

 

 

10000SB0011sam003- 76 -LRB100 06001 RPS 21154 a

1    variety of options for investments. These options shall
2    include investments handled by the Illinois State Board of
3    Investment as well as private sector investment options.
4        (7) The defined contribution plan shall provide a
5    variety of options for payouts to retirees and their
6    survivors.
7        (8) To the extent authorized under federal law and as
8    authorized by the System, the plan shall allow former
9    participants in the plan to transfer or roll over employee
10    and vested State contributions, and the earnings thereon,
11    into other qualified retirement plans.
12        (9) The System shall reduce the employee contributions
13    credited to the participant's defined contribution plan
14    account by an amount determined by the System to cover the
15    cost of offering these benefits and any applicable
16    administrative fees.
17    (b) Only persons who are active Tier 1 employees of the
18System on the effective date of this Section are eligible to
19participate in the defined contribution plan. Participation in
20the defined contribution plan shall be limited to the first 5%
21of eligible persons who elect to participate. The election to
22participate in the defined contribution plan is voluntary and
23irrevocable.
24    (c) An eligible active Tier 1 employee may irrevocably
25elect to participate in the defined contribution plan by filing
26with the System a written application to participate that is

 

 

10000SB0011sam003- 77 -LRB100 06001 RPS 21154 a

1received by the System prior to its determination that 5% of
2eligible persons have elected to participate in the defined
3contribution plan.
4    When the System first determines that 5% of eligible
5persons have elected to participate in the defined contribution
6plan, the System shall provide notice to previously eligible
7employees that the plan is no longer available and shall cease
8accepting applications to participate.
9    (d) The System shall make a good faith effort to contact
10each active Tier 1 employee who is eligible to participate in
11the defined contribution plan. The System shall mail
12information describing the option to join the defined
13contribution plan to each of these employees to his or her last
14known address on file with the System. If the employee is not
15responsive to other means of contact, it is sufficient for the
16System to publish the details of the option on its website.
17    Upon request for further information describing the
18option, the System shall provide employees with information
19from the System before exercising the option to join the plan,
20including information on the impact to their vested benefits or
21non-vested service. The individual consultation shall include
22projections of the participant's defined benefits at
23retirement or earlier termination of service and the value of
24the participant's account at retirement or earlier termination
25of service. The System shall not provide advice or counseling
26with respect to whether the employee should exercise the

 

 

10000SB0011sam003- 78 -LRB100 06001 RPS 21154 a

1option. The System shall inform Tier 1 employees who are
2eligible to participate in the defined contribution plan that
3they may also wish to obtain information and counsel relating
4to their option from any other available source, including but
5not limited to labor organizations, private counsel, and
6financial advisors.
7    (e) In no event shall the System, its staff, its authorized
8representatives, or the Board be liable for any information
9given to an employee under this Section. The System may
10coordinate with the Illinois Department of Central Management
11Services and other retirement systems administering a defined
12contribution plan in accordance with this amendatory Act of the
13100th General Assembly to provide information concerning the
14impact of the option set forth in this Section.
15    (f) Notwithstanding any other provision of this Section, no
16person shall begin participating in the defined contribution
17plan until it has attained qualified plan status and received
18all necessary approvals from the U.S. Internal Revenue Service.
19    (g) The System shall report on its progress under this
20Section, including the available details of the defined
21contribution plan and the System's plans for informing eligible
22Tier 1 employees about the plan, to the Governor and the
23General Assembly on or before January 15, 2018.
24    (h) The Illinois State Board of Investments shall be the
25plan sponsor for the defined contribution plan established
26under this Section.

 

 

10000SB0011sam003- 79 -LRB100 06001 RPS 21154 a

1    (i) The intent of this amendatory Act of the 100th General
2Assembly is to ensure that the State's normal cost of
3participation in the defined contribution plan is similar, and
4if possible equal, to the State's normal cost of participation
5in the defined benefit plan, unless a lower State's normal cost
6is necessary to ensure cost neutrality.
7    (j) If Section 2-110.3 is determined to be unconstitutional
8or otherwise invalid by a final unappealable decision of an
9Illinois court or a court of competent jurisdiction, then this
10Section shall not take effect and is repealed by operation of
11law.
 
12    (40 ILCS 5/2-166.1 new)
13    Sec. 2-166.1. Defined contribution plan; termination. If
14the defined contribution plan is terminated or becomes
15inoperative pursuant to law, then each participant in the plan
16shall automatically be deemed to have been a contributing Tier
171 employee in the System's defined benefit plan during the time
18in which he or she participated in the defined contribution
19plan, and for that purpose the System shall be entitled to
20recover the amounts in the participant's defined contribution
21accounts.
 
22    (40 ILCS 5/14-131)
23    Sec. 14-131. Contributions by State.
24    (a) The State shall make contributions to the System by

 

 

10000SB0011sam003- 80 -LRB100 06001 RPS 21154 a

1appropriations of amounts which, together with other employer
2contributions from trust, federal, and other funds, employee
3contributions, investment income, and other income, will be
4sufficient to meet the cost of maintaining and administering
5the System on a 90% funded basis in accordance with actuarial
6recommendations.
7    For the purposes of this Section and Section 14-135.08,
8references to State contributions refer only to employer
9contributions and do not include employee contributions that
10are picked up or otherwise paid by the State or a department on
11behalf of the employee.
12    (b) The Board shall determine the total amount of State
13contributions required for each fiscal year on the basis of the
14actuarial tables and other assumptions adopted by the Board,
15using the formula in subsection (e).
16    The Board shall also determine a State contribution rate
17for each fiscal year, expressed as a percentage of payroll,
18based on the total required State contribution for that fiscal
19year (less the amount received by the System from
20appropriations under Section 8.12 of the State Finance Act and
21Section 1 of the State Pension Funds Continuing Appropriation
22Act, if any, for the fiscal year ending on the June 30
23immediately preceding the applicable November 15 certification
24deadline), the estimated payroll (including all forms of
25compensation) for personal services rendered by eligible
26employees, and the recommendations of the actuary.

 

 

10000SB0011sam003- 81 -LRB100 06001 RPS 21154 a

1    For the purposes of this Section and Section 14.1 of the
2State Finance Act, the term "eligible employees" includes
3employees who participate in the System, persons who may elect
4to participate in the System but have not so elected, persons
5who are serving a qualifying period that is required for
6participation, and annuitants employed by a department as
7described in subdivision (a)(1) or (a)(2) of Section 14-111.
8    (c) Contributions shall be made by the several departments
9for each pay period by warrants drawn by the State Comptroller
10against their respective funds or appropriations based upon
11vouchers stating the amount to be so contributed. These amounts
12shall be based on the full rate certified by the Board under
13Section 14-135.08 for that fiscal year. From the effective date
14of this amendatory Act of the 93rd General Assembly through the
15payment of the final payroll from fiscal year 2004
16appropriations, the several departments shall not make
17contributions for the remainder of fiscal year 2004 but shall
18instead make payments as required under subsection (a-1) of
19Section 14.1 of the State Finance Act. The several departments
20shall resume those contributions at the commencement of fiscal
21year 2005.
22    (c-1) Notwithstanding subsection (c) of this Section, for
23fiscal years 2010, 2012, 2013, 2014, 2015, 2016, and 2017 only,
24contributions by the several departments are not required to be
25made for General Revenue Funds payrolls processed by the
26Comptroller. Payrolls paid by the several departments from all

 

 

10000SB0011sam003- 82 -LRB100 06001 RPS 21154 a

1other State funds must continue to be processed pursuant to
2subsection (c) of this Section.
3    (c-2) For State fiscal years 2010, 2012, 2013, 2014, 2015,
42016, and 2017 only, on or as soon as possible after the 15th
5day of each month, the Board shall submit vouchers for payment
6of State contributions to the System, in a total monthly amount
7of one-twelfth of the fiscal year General Revenue Fund
8contribution as certified by the System pursuant to Section
914-135.08 of the Illinois Pension Code.
10    (d) If an employee is paid from trust funds or federal
11funds, the department or other employer shall pay employer
12contributions from those funds to the System at the certified
13rate, unless the terms of the trust or the federal-State
14agreement preclude the use of the funds for that purpose, in
15which case the required employer contributions shall be paid by
16the State. From the effective date of this amendatory Act of
17the 93rd General Assembly through the payment of the final
18payroll from fiscal year 2004 appropriations, the department or
19other employer shall not pay contributions for the remainder of
20fiscal year 2004 but shall instead make payments as required
21under subsection (a-1) of Section 14.1 of the State Finance
22Act. The department or other employer shall resume payment of
23contributions at the commencement of fiscal year 2005.
24    (e) For State fiscal years 2018 through 2045, the minimum
25contribution to the System to be made by the State for each
26fiscal year shall be an amount determined by the System to be

 

 

10000SB0011sam003- 83 -LRB100 06001 RPS 21154 a

1sufficient to bring the total assets of the System up to 90% of
2the total actuarial liabilities of the System by the end of
3State fiscal year 2045. In making these determinations, the
4required State contribution shall be calculated each year as a
5level percentage of total payroll, including payroll that is
6not deemed pensionable, over the years remaining to and
7including fiscal year 2045 and shall be determined under the
8projected unit credit actuarial cost method.
9    Beginning in State fiscal year 2018, any increase or
10decrease in State contribution over the prior fiscal year due
11exclusively to changes in actuarial or investment assumptions
12adopted by the Board shall be included in the State
13contribution to the System, as a percentage of the applicable
14employee payroll, and shall be increased in equal annual
15increments so that by the State fiscal year occurring 5 years
16after the adoption of the actuarial or investment assumptions,
17the State is contributing at the rate otherwise required under
18this Section.
19    For State fiscal years 2012 through 2017 2045, the minimum
20contribution to the System to be made by the State for each
21fiscal year shall be an amount determined by the System to be
22sufficient to bring the total assets of the System up to 90% of
23the total actuarial liabilities of the System by the end of
24State fiscal year 2045. In making these determinations, the
25required State contribution shall be calculated each year as a
26level percentage of payroll over the years remaining to and

 

 

10000SB0011sam003- 84 -LRB100 06001 RPS 21154 a

1including fiscal year 2045 and shall be determined under the
2projected unit credit actuarial cost method.
3    For State fiscal years 1996 through 2005, the State
4contribution to the System, as a percentage of the applicable
5employee payroll, shall be increased in equal annual increments
6so that by State fiscal year 2011, the State is contributing at
7the rate required under this Section; except that (i) for State
8fiscal year 1998, for all purposes of this Code and any other
9law of this State, the certified percentage of the applicable
10employee payroll shall be 5.052% for employees earning eligible
11creditable service under Section 14-110 and 6.500% for all
12other employees, notwithstanding any contrary certification
13made under Section 14-135.08 before the effective date of this
14amendatory Act of 1997, and (ii) in the following specified
15State fiscal years, the State contribution to the System shall
16not be less than the following indicated percentages of the
17applicable employee payroll, even if the indicated percentage
18will produce a State contribution in excess of the amount
19otherwise required under this subsection and subsection (a):
209.8% in FY 1999; 10.0% in FY 2000; 10.2% in FY 2001; 10.4% in FY
212002; 10.6% in FY 2003; and 10.8% in FY 2004.
22    Notwithstanding any other provision of this Article, the
23total required State contribution to the System for State
24fiscal year 2006 is $203,783,900.
25    Notwithstanding any other provision of this Article, the
26total required State contribution to the System for State

 

 

10000SB0011sam003- 85 -LRB100 06001 RPS 21154 a

1fiscal year 2007 is $344,164,400.
2    For each of State fiscal years 2008 through 2009, the State
3contribution to the System, as a percentage of the applicable
4employee payroll, shall be increased in equal annual increments
5from the required State contribution for State fiscal year
62007, so that by State fiscal year 2011, the State is
7contributing at the rate otherwise required under this Section.
8    Notwithstanding any other provision of this Article, the
9total required State General Revenue Fund contribution for
10State fiscal year 2010 is $723,703,100 and shall be made from
11the proceeds of bonds sold in fiscal year 2010 pursuant to
12Section 7.2 of the General Obligation Bond Act, less (i) the
13pro rata share of bond sale expenses determined by the System's
14share of total bond proceeds, (ii) any amounts received from
15the General Revenue Fund in fiscal year 2010, and (iii) any
16reduction in bond proceeds due to the issuance of discounted
17bonds, if applicable.
18    Notwithstanding any other provision of this Article, the
19total required State General Revenue Fund contribution for
20State fiscal year 2011 is the amount recertified by the System
21on or before April 1, 2011 pursuant to Section 14-135.08 and
22shall be made from the proceeds of bonds sold in fiscal year
232011 pursuant to Section 7.2 of the General Obligation Bond
24Act, less (i) the pro rata share of bond sale expenses
25determined by the System's share of total bond proceeds, (ii)
26any amounts received from the General Revenue Fund in fiscal

 

 

10000SB0011sam003- 86 -LRB100 06001 RPS 21154 a

1year 2011, and (iii) any reduction in bond proceeds due to the
2issuance of discounted bonds, if applicable.
3    Beginning in State fiscal year 2046, the minimum State
4contribution for each fiscal year shall be the amount needed to
5maintain the total assets of the System at 90% of the total
6actuarial liabilities of the System.
7    Amounts received by the System pursuant to Section 25 of
8the Budget Stabilization Act or Section 8.12 of the State
9Finance Act in any fiscal year do not reduce and do not
10constitute payment of any portion of the minimum State
11contribution required under this Article in that fiscal year.
12Such amounts shall not reduce, and shall not be included in the
13calculation of, the required State contributions under this
14Article in any future year until the System has reached a
15funding ratio of at least 90%. A reference in this Article to
16the "required State contribution" or any substantially similar
17term does not include or apply to any amounts payable to the
18System under Section 25 of the Budget Stabilization Act.
19    Notwithstanding any other provision of this Section, the
20required State contribution for State fiscal year 2005 and for
21fiscal year 2008 and each fiscal year thereafter, as calculated
22under this Section and certified under Section 14-135.08, shall
23not exceed an amount equal to (i) the amount of the required
24State contribution that would have been calculated under this
25Section for that fiscal year if the System had not received any
26payments under subsection (d) of Section 7.2 of the General

 

 

10000SB0011sam003- 87 -LRB100 06001 RPS 21154 a

1Obligation Bond Act, minus (ii) the portion of the State's
2total debt service payments for that fiscal year on the bonds
3issued in fiscal year 2003 for the purposes of that Section
47.2, as determined and certified by the Comptroller, that is
5the same as the System's portion of the total moneys
6distributed under subsection (d) of Section 7.2 of the General
7Obligation Bond Act. In determining this maximum for State
8fiscal years 2008 through 2010, however, the amount referred to
9in item (i) shall be increased, as a percentage of the
10applicable employee payroll, in equal increments calculated
11from the sum of the required State contribution for State
12fiscal year 2007 plus the applicable portion of the State's
13total debt service payments for fiscal year 2007 on the bonds
14issued in fiscal year 2003 for the purposes of Section 7.2 of
15the General Obligation Bond Act, so that, by State fiscal year
162011, the State is contributing at the rate otherwise required
17under this Section.
18    (f) After the submission of all payments for eligible
19employees from personal services line items in fiscal year 2004
20have been made, the Comptroller shall provide to the System a
21certification of the sum of all fiscal year 2004 expenditures
22for personal services that would have been covered by payments
23to the System under this Section if the provisions of this
24amendatory Act of the 93rd General Assembly had not been
25enacted. Upon receipt of the certification, the System shall
26determine the amount due to the System based on the full rate

 

 

10000SB0011sam003- 88 -LRB100 06001 RPS 21154 a

1certified by the Board under Section 14-135.08 for fiscal year
22004 in order to meet the State's obligation under this
3Section. The System shall compare this amount due to the amount
4received by the System in fiscal year 2004 through payments
5under this Section and under Section 6z-61 of the State Finance
6Act. If the amount due is more than the amount received, the
7difference shall be termed the "Fiscal Year 2004 Shortfall" for
8purposes of this Section, and the Fiscal Year 2004 Shortfall
9shall be satisfied under Section 1.2 of the State Pension Funds
10Continuing Appropriation Act. If the amount due is less than
11the amount received, the difference shall be termed the "Fiscal
12Year 2004 Overpayment" for purposes of this Section, and the
13Fiscal Year 2004 Overpayment shall be repaid by the System to
14the Pension Contribution Fund as soon as practicable after the
15certification.
16    (g) For purposes of determining the required State
17contribution to the System, the value of the System's assets
18shall be equal to the actuarial value of the System's assets,
19which shall be calculated as follows:
20    As of June 30, 2008, the actuarial value of the System's
21assets shall be equal to the market value of the assets as of
22that date. In determining the actuarial value of the System's
23assets for fiscal years after June 30, 2008, any actuarial
24gains or losses from investment return incurred in a fiscal
25year shall be recognized in equal annual amounts over the
265-year period following that fiscal year.

 

 

10000SB0011sam003- 89 -LRB100 06001 RPS 21154 a

1    (h) For purposes of determining the required State
2contribution to the System for a particular year, the actuarial
3value of assets shall be assumed to earn a rate of return equal
4to the System's actuarially assumed rate of return.
5    (i) After the submission of all payments for eligible
6employees from personal services line items paid from the
7General Revenue Fund in fiscal year 2010 have been made, the
8Comptroller shall provide to the System a certification of the
9sum of all fiscal year 2010 expenditures for personal services
10that would have been covered by payments to the System under
11this Section if the provisions of this amendatory Act of the
1296th General Assembly had not been enacted. Upon receipt of the
13certification, the System shall determine the amount due to the
14System based on the full rate certified by the Board under
15Section 14-135.08 for fiscal year 2010 in order to meet the
16State's obligation under this Section. The System shall compare
17this amount due to the amount received by the System in fiscal
18year 2010 through payments under this Section. If the amount
19due is more than the amount received, the difference shall be
20termed the "Fiscal Year 2010 Shortfall" for purposes of this
21Section, and the Fiscal Year 2010 Shortfall shall be satisfied
22under Section 1.2 of the State Pension Funds Continuing
23Appropriation Act. If the amount due is less than the amount
24received, the difference shall be termed the "Fiscal Year 2010
25Overpayment" for purposes of this Section, and the Fiscal Year
262010 Overpayment shall be repaid by the System to the General

 

 

10000SB0011sam003- 90 -LRB100 06001 RPS 21154 a

1Revenue Fund as soon as practicable after the certification.
2    (j) After the submission of all payments for eligible
3employees from personal services line items paid from the
4General Revenue Fund in fiscal year 2011 have been made, the
5Comptroller shall provide to the System a certification of the
6sum of all fiscal year 2011 expenditures for personal services
7that would have been covered by payments to the System under
8this Section if the provisions of this amendatory Act of the
996th General Assembly had not been enacted. Upon receipt of the
10certification, the System shall determine the amount due to the
11System based on the full rate certified by the Board under
12Section 14-135.08 for fiscal year 2011 in order to meet the
13State's obligation under this Section. The System shall compare
14this amount due to the amount received by the System in fiscal
15year 2011 through payments under this Section. If the amount
16due is more than the amount received, the difference shall be
17termed the "Fiscal Year 2011 Shortfall" for purposes of this
18Section, and the Fiscal Year 2011 Shortfall shall be satisfied
19under Section 1.2 of the State Pension Funds Continuing
20Appropriation Act. If the amount due is less than the amount
21received, the difference shall be termed the "Fiscal Year 2011
22Overpayment" for purposes of this Section, and the Fiscal Year
232011 Overpayment shall be repaid by the System to the General
24Revenue Fund as soon as practicable after the certification.
25    (k) For fiscal years 2012 through 2017 only, after the
26submission of all payments for eligible employees from personal

 

 

10000SB0011sam003- 91 -LRB100 06001 RPS 21154 a

1services line items paid from the General Revenue Fund in the
2fiscal year have been made, the Comptroller shall provide to
3the System a certification of the sum of all expenditures in
4the fiscal year for personal services. Upon receipt of the
5certification, the System shall determine the amount due to the
6System based on the full rate certified by the Board under
7Section 14-135.08 for the fiscal year in order to meet the
8State's obligation under this Section. The System shall compare
9this amount due to the amount received by the System for the
10fiscal year. If the amount due is more than the amount
11received, the difference shall be termed the "Prior Fiscal Year
12Shortfall" for purposes of this Section, and the Prior Fiscal
13Year Shortfall shall be satisfied under Section 1.2 of the
14State Pension Funds Continuing Appropriation Act. If the amount
15due is less than the amount received, the difference shall be
16termed the "Prior Fiscal Year Overpayment" for purposes of this
17Section, and the Prior Fiscal Year Overpayment shall be repaid
18by the System to the General Revenue Fund as soon as
19practicable after the certification.
20(Source: P.A. 98-24, eff. 6-19-13; 98-674, eff. 6-30-14; 99-8,
21eff. 7-9-15; 99-523, eff. 6-30-16.)
 
22    (40 ILCS 5/14-135.08)  (from Ch. 108 1/2, par. 14-135.08)
23    (Text of Section WITHOUT the changes made by P.A. 98-599,
24which has been held unconstitutional)
25    Sec. 14-135.08. To certify required State contributions.

 

 

10000SB0011sam003- 92 -LRB100 06001 RPS 21154 a

1    (a) To certify to the Governor and to each department, on
2or before November 15 of each year until November 15, 2011, the
3required rate for State contributions to the System for the
4next State fiscal year, as determined under subsection (b) of
5Section 14-131. The certification to the Governor under this
6subsection (a) shall include a copy of the actuarial
7recommendations upon which the rate is based and shall
8specifically identify the System's projected State normal cost
9for that fiscal year.
10    (a-5) On or before November 1 of each year, beginning
11November 1, 2012, the Board shall submit to the State Actuary,
12the Governor, and the General Assembly a proposed certification
13of the amount of the required State contribution to the System
14for the next fiscal year, along with all of the actuarial
15assumptions, calculations, and data upon which that proposed
16certification is based. On or before January 1 of each year
17beginning January 1, 2013, the State Actuary shall issue a
18preliminary report concerning the proposed certification and
19identifying, if necessary, recommended changes in actuarial
20assumptions that the Board must consider before finalizing its
21certification of the required State contributions. On or before
22January 15, 2013 and each January 15 thereafter, the Board
23shall certify to the Governor and the General Assembly the
24amount of the required State contribution for the next fiscal
25year. The Board's certification must note any deviations from
26the State Actuary's recommended changes, the reason or reasons

 

 

10000SB0011sam003- 93 -LRB100 06001 RPS 21154 a

1for not following the State Actuary's recommended changes, and
2the fiscal impact of not following the State Actuary's
3recommended changes on the required State contribution.
4    (b) The certifications under subsections (a) and (a-5)
5shall include an additional amount necessary to pay all
6principal of and interest on those general obligation bonds due
7the next fiscal year authorized by Section 7.2(a) of the
8General Obligation Bond Act and issued to provide the proceeds
9deposited by the State with the System in July 2003,
10representing deposits other than amounts reserved under
11Section 7.2(c) of the General Obligation Bond Act. For State
12fiscal year 2005, the Board shall make a supplemental
13certification of the additional amount necessary to pay all
14principal of and interest on those general obligation bonds due
15in State fiscal years 2004 and 2005 authorized by Section
167.2(a) of the General Obligation Bond Act and issued to provide
17the proceeds deposited by the State with the System in July
182003, representing deposits other than amounts reserved under
19Section 7.2(c) of the General Obligation Bond Act, as soon as
20practical after the effective date of this amendatory Act of
21the 93rd General Assembly.
22    On or before May 1, 2004, the Board shall recalculate and
23recertify to the Governor and to each department the amount of
24the required State contribution to the System and the required
25rates for State contributions to the System for State fiscal
26year 2005, taking into account the amounts appropriated to and

 

 

10000SB0011sam003- 94 -LRB100 06001 RPS 21154 a

1received by the System under subsection (d) of Section 7.2 of
2the General Obligation Bond Act.
3    On or before July 1, 2005, the Board shall recalculate and
4recertify to the Governor and to each department the amount of
5the required State contribution to the System and the required
6rates for State contributions to the System for State fiscal
7year 2006, taking into account the changes in required State
8contributions made by this amendatory Act of the 94th General
9Assembly.
10    On or before April 1, 2011, the Board shall recalculate and
11recertify to the Governor and to each department the amount of
12the required State contribution to the System for State fiscal
13year 2011, applying the changes made by Public Act 96-889 to
14the System's assets and liabilities as of June 30, 2009 as
15though Public Act 96-889 was approved on that date.
16    As soon as practical after the effective date of this
17amendatory Act of the 100th General Assembly, the State Actuary
18and the Board shall recalculate and recertify to the Governor
19and the General Assembly the amount of the State contribution
20to the System for State fiscal year 2018, taking into account
21the changes in required State contributions made by this
22amendatory Act of the 100th General Assembly.
23(Source: P.A. 96-1497, eff. 1-14-11; 96-1511, eff. 1-27-11;
2497-694, eff. 6-18-12.)
 
25    (40 ILCS 5/14-147.5 new)

 

 

10000SB0011sam003- 95 -LRB100 06001 RPS 21154 a

1    Sec. 14-147.5. Accelerated pension benefit payment.
2    (a) As used in this Section:
3    "Eligible person" means a person who:
4        (1) has terminated service;
5        (2) has accrued sufficient service credit to be
6    eligible to receive a retirement annuity under this
7    Article;
8        (3) has not received any retirement annuity under this
9    Article; and
10        (4) does not have a QILDRO in effect against him or her
11    under this Article.
12    "Pension benefit" means the benefits under this Article, or
13Article 1 as it relates to those benefits, including any
14anticipated annual increases, that an eligible person is
15entitled to upon attainment of the applicable retirement age.
16"Pension benefit" also includes applicable survivor's or
17disability benefits.
18    (b) Before January 1, 2018, and annually thereafter, the
19System shall calculate, using actuarial tables and other
20assumptions adopted by the Board, the net present value of
21pension benefits for each eligible person and shall offer each
22eligible person the opportunity to irrevocably elect to receive
23an amount determined by the System to be equal to 70% of the
24net present value of his or her pension benefits in lieu of
25receiving any pension benefit. The offer shall specify the
26dollar amount that the eligible person will receive if he or

 

 

10000SB0011sam003- 96 -LRB100 06001 RPS 21154 a

1she so elects and shall expire when a subsequent offer is made
2to an eligible person or when the System determines that 10% of
3eligible persons in that year have made the election under this
4subsection, whichever occurs first. The System shall make a
5good faith effort to contact every eligible person to notify
6him or her of the election and of the amount of the accelerated
7pension benefit payment.
8    Until the System determines that 10% of eligible persons in
9that year have made the election under this subsection, an
10eligible person may irrevocably elect to receive an accelerated
11pension benefit payment in the amount that the System offers
12under this subsection in lieu of receiving any pension benefit.
13A person who elects to receive an accelerated pension benefit
14payment under this Section may not elect to proceed under the
15Retirement Systems Reciprocal Act with respect to service under
16this Article.
17    (c) A person's credits and creditable service under this
18Article shall be terminated upon the person's receipt of an
19accelerated pension benefit payment under this Section, and no
20other benefit shall be paid under this Article based on those
21terminated credits and creditable service, including any
22retirement, survivor, or other benefit; except that to the
23extent that participation, benefits, or premiums under the
24State Employees Group Insurance Act of 1971 are based on the
25amount of service credit, the terminated service credit shall
26be used for that purpose.

 

 

10000SB0011sam003- 97 -LRB100 06001 RPS 21154 a

1    (d) If a person who has received an accelerated pension
2benefit payment under this Section returns to active service
3under this Article, then:
4        (1) Any benefits under the System earned as a result of
5    that return to active service shall be based solely on the
6    person's credits and creditable service arising from the
7    return to active service.
8        (2) The accelerated pension benefit payment may not be
9    repaid to the System, and the terminated credits and
10    creditable service may not under any circumstances be
11    reinstated.
12    (e) As a condition of receiving an accelerated pension
13benefit payment, an eligible person must have another
14retirement plan or account qualified under the Internal Revenue
15Code of 1986, as amended, for the accelerated pension benefit
16payment to be rolled into. The accelerated pension benefit
17payment under this Section may be subject to withholding or
18payment of applicable taxes, but to the extent permitted by
19federal law, a person who receives an accelerated pension
20benefit payment under this Section must direct the System to
21pay all of that payment as a rollover into another retirement
22plan or account qualified under the Internal Revenue Code of
231986, as amended.
24    (f) Before January 1, 2019 and every January 1 thereafter,
25the Board shall certify to the Illinois Finance Authority and
26the General Assembly the amount by which the total amount of

 

 

10000SB0011sam003- 98 -LRB100 06001 RPS 21154 a

1accelerated pension benefit payments made under this Section
2exceed the amount appropriated to the System for the purpose of
3making those payments.
4    (g) The Board shall adopt any rules necessary to implement
5this Section.
6    (h) No provision of this Section shall be interpreted in a
7way that would cause the applicable System to cease to be a
8qualified plan under the Internal Revenue Code of 1986.
9    (i) Notwithstanding any other provision of this Section, in
10no case shall the total amount of accelerated pension benefit
11payments paid under this Section, Section 15-185.5, and Section
1216-190.5 cause the Illinois Finance Authority to issue more
13than the $250,000,000 of State Pension Obligation Acceleration
14Bonds authorized in subsection (c-5) of Section 801-40 of the
15Illinois Finance Authority Act.
 
16    (40 ILCS 5/14-152.1)
17    (Text of Section WITHOUT the changes made by P.A. 98-599,
18which has been held unconstitutional)
19    Sec. 14-152.1. Application and expiration of new benefit
20increases.
21    (a) As used in this Section, "new benefit increase" means
22an increase in the amount of any benefit provided under this
23Article, or an expansion of the conditions of eligibility for
24any benefit under this Article, that results from an amendment
25to this Code that takes effect after June 1, 2005 (the

 

 

10000SB0011sam003- 99 -LRB100 06001 RPS 21154 a

1effective date of Public Act 94-4). "New benefit increase",
2however, does not include any benefit increase resulting from
3the changes made to this Article by Public Act 96-37 or by this
4amendatory Act of the 100th General Assembly this amendatory
5Act of the 96th General Assembly.
6    (b) Notwithstanding any other provision of this Code or any
7subsequent amendment to this Code, every new benefit increase
8is subject to this Section and shall be deemed to be granted
9only in conformance with and contingent upon compliance with
10the provisions of this Section.
11    (c) The Public Act enacting a new benefit increase must
12identify and provide for payment to the System of additional
13funding at least sufficient to fund the resulting annual
14increase in cost to the System as it accrues.
15    Every new benefit increase is contingent upon the General
16Assembly providing the additional funding required under this
17subsection. The Commission on Government Forecasting and
18Accountability shall analyze whether adequate additional
19funding has been provided for the new benefit increase and
20shall report its analysis to the Public Pension Division of the
21Department of Financial and Professional Regulation. A new
22benefit increase created by a Public Act that does not include
23the additional funding required under this subsection is null
24and void. If the Public Pension Division determines that the
25additional funding provided for a new benefit increase under
26this subsection is or has become inadequate, it may so certify

 

 

10000SB0011sam003- 100 -LRB100 06001 RPS 21154 a

1to the Governor and the State Comptroller and, in the absence
2of corrective action by the General Assembly, the new benefit
3increase shall expire at the end of the fiscal year in which
4the certification is made.
5    (d) Every new benefit increase shall expire 5 years after
6its effective date or on such earlier date as may be specified
7in the language enacting the new benefit increase or provided
8under subsection (c). This does not prevent the General
9Assembly from extending or re-creating a new benefit increase
10by law.
11    (e) Except as otherwise provided in the language creating
12the new benefit increase, a new benefit increase that expires
13under this Section continues to apply to persons who applied
14and qualified for the affected benefit while the new benefit
15increase was in effect and to the affected beneficiaries and
16alternate payees of such persons, but does not apply to any
17other person, including without limitation a person who
18continues in service after the expiration date and did not
19apply and qualify for the affected benefit while the new
20benefit increase was in effect.
21(Source: P.A. 96-37, eff. 7-13-09.)
 
22    (40 ILCS 5/15-108.1)
23    Sec. 15-108.1. Tier 1 member; Tier 1 employee.
24    "Tier 1 member": A participant or an annuitant of a
25retirement annuity under this Article, other than a participant

 

 

10000SB0011sam003- 101 -LRB100 06001 RPS 21154 a

1in the self-managed plan under Section 15-158.2, who first
2became a participant or member before January 1, 2011 under any
3reciprocal retirement system or pension fund established under
4this Code, other than a retirement system or pension fund
5established under Articles 2, 3, 4, 5, 6, or 18 of this Code.
6"Tier 1 member" includes a person who first became a
7participant under this System before January 1, 2011 and who
8accepts a refund and is subsequently reemployed by an employer
9on or after January 1, 2011.
10    "Tier 1 employee": A Tier 1 member who is a participating
11employee, unless he or she is a disability benefit recipient
12under Section 15-150. However, for the purposes of the election
13under Section 15-132.9, "Tier 1 employee" does not include an
14individual who has made an irrevocable election on or before
15June 1, 2017 to retire from service pursuant to the terms of an
16employment contract or a collective bargaining agreement in
17effect on June 1, 2017, excluding any extension, amendment, or
18renewal of that agreement on or after that date, and has
19notified the System of that election.
20(Source: P.A. 98-92, eff. 7-16-13.)
 
21    (40 ILCS 5/15-111)  (from Ch. 108 1/2, par. 15-111)
22    Sec. 15-111. Earnings.
23    (a) "Earnings": Subject to Section 15-111.5, an amount paid
24for personal services equal to the sum of the basic
25compensation plus extra compensation for summer teaching,

 

 

10000SB0011sam003- 102 -LRB100 06001 RPS 21154 a

1overtime or other extra service. For periods for which an
2employee receives service credit under subsection (c) of
3Section 15-113.1 or Section 15-113.2, earnings are equal to the
4basic compensation on which contributions are paid by the
5employee during such periods. Compensation for employment
6which is irregular, intermittent and temporary shall not be
7considered earnings, unless the participant is also receiving
8earnings from the employer as an employee under Section 15-107.
9    With respect to transition pay paid by the University of
10Illinois to a person who was a participating employee employed
11in the fire department of the University of Illinois's
12Champaign-Urbana campus immediately prior to the elimination
13of that fire department:
14        (1) "Earnings" includes transition pay paid to the
15    employee on or after the effective date of this amendatory
16    Act of the 91st General Assembly.
17        (2) "Earnings" includes transition pay paid to the
18    employee before the effective date of this amendatory Act
19    of the 91st General Assembly only if (i) employee
20    contributions under Section 15-157 have been withheld from
21    that transition pay or (ii) the employee pays to the System
22    before January 1, 2001 an amount representing employee
23    contributions under Section 15-157 on that transition pay.
24    Employee contributions under item (ii) may be paid in a
25    lump sum, by withholding from additional transition pay
26    accruing before January 1, 2001, or in any other manner

 

 

10000SB0011sam003- 103 -LRB100 06001 RPS 21154 a

1    approved by the System. Upon payment of the employee
2    contributions on transition pay, the corresponding
3    employer contributions become an obligation of the State.
4    (a-5) Notwithstanding any other provision of this Section,
5"earnings" does not include any future increase in income that
6is offered for service by an employer to a Tier 1 employee
7under this Article pursuant to the condition set forth in
8subsection (c) of Section 15-132.9 and accepted under that
9condition by a Tier 1 employee who has made the election under
10paragraph (2) of subsection (a) of Section 15-132.9.
11    (a-10) Notwithstanding any other provision of this
12Section, "earnings" does not include any consideration payment
13made to a Tier 1 employee.
14    (b) For a Tier 2 member, the annual earnings shall not
15exceed $106,800; however, that amount shall annually
16thereafter be increased by the lesser of (i) 3% of that amount,
17including all previous adjustments, or (ii) one half the annual
18unadjusted percentage increase (but not less than zero) in the
19consumer price index-u for the 12 months ending with the
20September preceding each November 1, including all previous
21adjustments.
22    For the purposes of this Section, "consumer price index u"
23means the index published by the Bureau of Labor Statistics of
24the United States Department of Labor that measures the average
25change in prices of goods and services purchased by all urban
26consumers, United States city average, all items, 1982-84 =

 

 

10000SB0011sam003- 104 -LRB100 06001 RPS 21154 a

1100. The new amount resulting from each annual adjustment shall
2be determined by the Public Pension Division of the Department
3of Insurance and made available to the boards of the retirement
4systems and pension funds by November 1 of each year.
5    (c) With each submission of payroll information in the
6manner prescribed by the System, the employer shall certify
7that the payroll information is correct and complies with all
8applicable State and federal laws.
9(Source: P.A. 98-92, eff. 7-16-13; 99-897, eff. 1-1-17.)
 
10    (40 ILCS 5/15-112.1 new)
11    Sec. 15-112.1. Future increase in income. "Future increase
12in income" means an increase to a Tier 1 employee's base pay
13that is offered by an employer to the Tier 1 employee for
14service under this Article after June 30, 2018 that qualifies
15as "earnings", as defined in Section 15-111, or would qualify
16as "earnings" but for the fact that it was offered to and
17accepted by the Tier 1 employee under the condition set forth
18in subsection (c) of Section 15-132.9. The term "future
19increase in income" includes an increase to a Tier 1 employee's
20base pay that is paid to the Tier 1 employee pursuant to an
21extension, amendment, or renewal of any such employment
22contract or collective bargaining agreement after the
23effective date of this Section.
 
24    (40 ILCS 5/15-112.2 new)

 

 

10000SB0011sam003- 105 -LRB100 06001 RPS 21154 a

1    Sec. 15-112.2. Base pay. As used in Section 15-112.1 of
2this Code, "base pay" means the greater of either (i) the Tier
31 employee's annualized rate of earnings as of June 30, 2018,
4or (ii) the Tier 1 employee's annualized rate of earnings
5immediately preceding the expiration, renewal, or amendment of
6an employment contract or collective bargaining agreement in
7effect on the effective date of this Section. For a person
8returning to participating employee status as a Tier 1 employee
9after June 30, 2018, however, "base pay" means the employee's
10annualized rate of earnings as of the employee's last date of
11service prior to July 1, 2018. The System shall calculate the
12base pay of each Tier 1 employee pursuant to this Section.
 
13    (40 ILCS 5/15-132.9 new)
14    Sec. 15-132.9. Election by Tier 1 employees.
15    (a) Each Tier 1 employee shall make an irrevocable election
16either:
17        (1) to agree to delay his or her eligibility for
18    automatic annual increases in retirement annuity as
19    provided in subsection (d-1) of Section 15-136 and to have
20    the amount of the automatic annual increases in his or her
21    retirement annuity and survivor annuity that are otherwise
22    provided for in this Article calculated, instead, as
23    provided in subsection (d-1) of Section 15-136; or
24        (2) to not agree to the provisions of paragraph (1) of
25    this subsection.

 

 

10000SB0011sam003- 106 -LRB100 06001 RPS 21154 a

1    The election required under this subsection (a) shall be
2made by each Tier 1 employee no earlier than January 1, 2018
3and no later than March 31, 2018, except that:
4        (i) a person who becomes a Tier 1 employee under this
5    Article on or after January 1, 2018 must make the election
6    under this subsection (a) within 60 days after becoming a
7    Tier 1 employee;
8        (ii) a person who returns to participating employee
9    status as a Tier 1 employee under this Article on or after
10    January 1, 2018 and has not yet made an election under this
11    Section must make the election under this subsection (a)
12    within 60 days after returning to participating employee
13    status as a Tier 1 employee; and
14        (iii) a person who returns to participating employee
15    status as a Tier 1 employee under this Article but who has
16    not made an election under Section 15-134.5 must make the
17    election under this subsection (a) at the same time as the
18    election under Section 15-134.5 and within the timeframes
19    required by that Section.
20    If a Tier 1 employee fails for any reason to make a
21required election under this subsection within the time
22specified, then the employee shall be deemed to have made the
23election under paragraph (2) of this subsection.
24    (a-5) If this Section is enjoined or stayed by an Illinois
25court or a court of competent jurisdiction pending the entry of
26a final and unappealable decision, and this Section is

 

 

10000SB0011sam003- 107 -LRB100 06001 RPS 21154 a

1determined to be constitutional or otherwise valid by a final
2unappealable decision of an Illinois court or a court of
3competent jurisdiction, then the election procedure set forth
4in subsection (a) of this Section shall commence on the 180th
5calendar day after the date of the issuance of the final
6unappealable decision and shall conclude at the end of the
7270th calendar day after that date.
8    (a-10) All elections under subsection (a) that are made or
9deemed to be made before July 1, 2018 shall take effect on July
101, 2018. Elections that are made or deemed to be made on or
11after July 1, 2018 shall take effect on the first day of the
12month following the month in which the election is made or
13deemed to be made.
14    (b) As adequate and legal consideration provided under this
15amendatory Act of the 100th General Assembly for making an
16election under paragraph (1) of subsection (a) of this Section,
17the employer shall be expressly and irrevocably prohibited from
18offering any future increases in income to a Tier 1 employee
19who has made an election under paragraph (1) of subsection (a)
20of this Section on the condition of not constituting earnings
21under Section 15-111.
22    As adequate and legal consideration provided under this
23amendatory Act of the 100th General Assembly for making an
24election under paragraph (1) of subsection (a) of this Section,
25each Tier 1 employee who has made an election under paragraph
26(1) of subsection (a) of this Section shall receive a

 

 

10000SB0011sam003- 108 -LRB100 06001 RPS 21154 a

1consideration payment equal to 10% of the contributions made by
2or on behalf of the employee under Section 15-157 before the
3effective date of that election. The State Comptroller shall
4pay the consideration payment to the Tier 1 employee out of
5funds appropriated for that purpose under Section 1.9 of the
6State Pension Funds Continuing Appropriation Act. The System
7shall calculate the amount of each consideration payment and,
8by July 1, 2018, shall certify to the State Comptroller the
9amount of the consideration payment, together with the name,
10address, and any other available payment information of the
11Tier 1 employee as found in the records of the System. The
12System shall make additional calculations and certifications
13of consideration payments to the State Comptroller as the
14System deems necessary.
15    (c) A Tier 1 employee who makes the election under
16paragraph (2) of subsection (a) of this Section shall not be
17subject to paragraph (1) of subsection (a) of this Section.
18However, each future increase in income offered by an employer
19under this Article to a Tier 1 employee who has made the
20election under paragraph (2) of subsection (a) of this Section
21shall be offered by the employer expressly and irrevocably on
22the condition of not constituting earnings under Section 15-111
23and that the Tier 1 employee's acceptance of the offered future
24increase in income shall constitute his or her agreement to
25that condition.
26    (d) The System shall make a good faith effort to contact

 

 

10000SB0011sam003- 109 -LRB100 06001 RPS 21154 a

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

 

 

10000SB0011sam003- 110 -LRB100 06001 RPS 21154 a

1election required under this Section from any other available
2source, including, but not limited to, labor organizations and
3private counsel.
4    In no event shall the System, its staff, or the Board be
5held liable for any information given to a member regarding the
6elections under this Section. The System shall coordinate with
7the Illinois Department of Central Management Services and each
8other retirement system administering an election in
9accordance with this amendatory Act of the 100th General
10Assembly to provide information concerning the impact of the
11election set forth in this Section.
12    (e) Notwithstanding any other provision of law, an employer
13under this Article is required to offer each future increase in
14income expressly and irrevocably on the condition of not
15constituting "earnings" under Section 15-111 to any Tier 1
16employee who has made an election under paragraph (2) of
17subsection (a) of this Section. The offer shall also provide
18that the Tier 1 employee's acceptance of the offered future
19increase in income shall constitute his or her agreement to the
20condition set forth in this subsection.
21    For purposes of legislative intent, the condition set forth
22in this subsection shall be construed in a manner that ensures
23that the condition is not violated or circumvented through any
24contrivance of any kind.
25    (f) A member's election under this Section is not a
26prohibited election under subdivision (j)(1) of Section 1-119

 

 

10000SB0011sam003- 111 -LRB100 06001 RPS 21154 a

1of this Code.
2    (g) No provision of this Section shall be interpreted in a
3way that would cause the System to cease to be a qualified plan
4under Section 401(a) of the Internal Revenue Code of 1986.
5    (h) If an election created by this amendatory Act in any
6other Article of this Code or any change deriving from that
7election is determined to be unconstitutional or otherwise
8invalid by a final unappealable decision of an Illinois court
9or a court of competent jurisdiction, the invalidity of that
10provision shall not in any way affect the validity of this
11Section or the changes deriving from the election required
12under this Section.
 
13    (40 ILCS 5/15-136)  (from Ch. 108 1/2, par. 15-136)
14    (Text of Section WITHOUT the changes made by P.A. 98-599,
15which has been held unconstitutional)
16    Sec. 15-136. Retirement annuities - Amount. The provisions
17of this Section 15-136 apply only to those participants who are
18participating in the traditional benefit package or the
19portable benefit package and do not apply to participants who
20are participating in the self-managed plan.
21    (a) The amount of a participant's retirement annuity,
22expressed in the form of a single-life annuity, shall be
23determined by whichever of the following rules is applicable
24and provides the largest annuity:
25    Rule 1: The retirement annuity shall be 1.67% of final rate

 

 

10000SB0011sam003- 112 -LRB100 06001 RPS 21154 a

1of earnings for each of the first 10 years of service, 1.90%
2for each of the next 10 years of service, 2.10% for each year
3of service in excess of 20 but not exceeding 30, and 2.30% for
4each year in excess of 30; or for persons who retire on or
5after January 1, 1998, 2.2% of the final rate of earnings for
6each year of service.
7    Rule 2: The retirement annuity shall be the sum of the
8following, determined from amounts credited to the participant
9in accordance with the actuarial tables and the effective rate
10of interest in effect at the time the retirement annuity
11begins:
12        (i) the normal annuity which can be provided on an
13    actuarially equivalent basis, by the accumulated normal
14    contributions as of the date the annuity begins;
15        (ii) an annuity from employer contributions of an
16    amount equal to that which can be provided on an
17    actuarially equivalent basis from the accumulated normal
18    contributions made by the participant under Section
19    15-113.6 and Section 15-113.7 plus 1.4 times all other
20    accumulated normal contributions made by the participant;
21    and
22        (iii) the annuity that can be provided on an
23    actuarially equivalent basis from the entire contribution
24    made by the participant under Section 15-113.3.
25    With respect to a police officer or firefighter who retires
26on or after August 14, 1998, the accumulated normal

 

 

10000SB0011sam003- 113 -LRB100 06001 RPS 21154 a

1contributions taken into account under clauses (i) and (ii) of
2this Rule 2 shall include the additional normal contributions
3made by the police officer or firefighter under Section
415-157(a).
5    The amount of a retirement annuity calculated under this
6Rule 2 shall be computed solely on the basis of the
7participant's accumulated normal contributions, as specified
8in this Rule and defined in Section 15-116. Neither an employee
9or employer contribution for early retirement under Section
1015-136.2 nor any other employer contribution shall be used in
11the calculation of the amount of a retirement annuity under
12this Rule 2.
13    This amendatory Act of the 91st General Assembly is a
14clarification of existing law and applies to every participant
15and annuitant without regard to whether status as an employee
16terminates before the effective date of this amendatory Act.
17    This Rule 2 does not apply to a person who first becomes an
18employee under this Article on or after July 1, 2005.
19    Rule 3: The retirement annuity of a participant who is
20employed at least one-half time during the period on which his
21or her final rate of earnings is based, shall be equal to the
22participant's years of service not to exceed 30, multiplied by
23(1) $96 if the participant's final rate of earnings is less
24than $3,500, (2) $108 if the final rate of earnings is at least
25$3,500 but less than $4,500, (3) $120 if the final rate of
26earnings is at least $4,500 but less than $5,500, (4) $132 if

 

 

10000SB0011sam003- 114 -LRB100 06001 RPS 21154 a

1the final rate of earnings is at least $5,500 but less than
2$6,500, (5) $144 if the final rate of earnings is at least
3$6,500 but less than $7,500, (6) $156 if the final rate of
4earnings is at least $7,500 but less than $8,500, (7) $168 if
5the final rate of earnings is at least $8,500 but less than
6$9,500, and (8) $180 if the final rate of earnings is $9,500 or
7more, except that the annuity for those persons having made an
8election under Section 15-154(a-1) shall be calculated and
9payable under the portable retirement benefit program pursuant
10to the provisions of Section 15-136.4.
11    Rule 4: A participant who is at least age 50 and has 25 or
12more years of service as a police officer or firefighter, and a
13participant who is age 55 or over and has at least 20 but less
14than 25 years of service as a police officer or firefighter,
15shall be entitled to a retirement annuity of 2 1/4% of the
16final rate of earnings for each of the first 10 years of
17service as a police officer or firefighter, 2 1/2% for each of
18the next 10 years of service as a police officer or
19firefighter, and 2 3/4% for each year of service as a police
20officer or firefighter in excess of 20. The retirement annuity
21for all other service shall be computed under Rule 1. A Tier 2
22member is eligible for a retirement annuity calculated under
23Rule 4 only if that Tier 2 member meets the service
24requirements for that benefit calculation as prescribed under
25this Rule 4 in addition to the applicable age requirement under
26subsection (a-5) of Section 15-135.

 

 

10000SB0011sam003- 115 -LRB100 06001 RPS 21154 a

1    For purposes of this Rule 4, a participant's service as a
2firefighter shall also include the following:
3        (i) service that is performed while the person is an
4    employee under subsection (h) of Section 15-107; and
5        (ii) in the case of an individual who was a
6    participating employee employed in the fire department of
7    the University of Illinois's Champaign-Urbana campus
8    immediately prior to the elimination of that fire
9    department and who immediately after the elimination of
10    that fire department transferred to another job with the
11    University of Illinois, service performed as an employee of
12    the University of Illinois in a position other than police
13    officer or firefighter, from the date of that transfer
14    until the employee's next termination of service with the
15    University of Illinois.
16    (b) For a Tier 1 member, the retirement annuity provided
17under Rules 1 and 3 above shall be reduced by 1/2 of 1% for each
18month the participant is under age 60 at the time of
19retirement. However, this reduction shall not apply in the
20following cases:
21        (1) For a disabled participant whose disability
22    benefits have been discontinued because he or she has
23    exhausted eligibility for disability benefits under clause
24    (6) of Section 15-152;
25        (2) For a participant who has at least the number of
26    years of service required to retire at any age under

 

 

10000SB0011sam003- 116 -LRB100 06001 RPS 21154 a

1    subsection (a) of Section 15-135; or
2        (3) For that portion of a retirement annuity which has
3    been provided on account of service of the participant
4    during periods when he or she performed the duties of a
5    police officer or firefighter, if these duties were
6    performed for at least 5 years immediately preceding the
7    date the retirement annuity is to begin.
8    (b-5) The retirement annuity of a Tier 2 member who is
9retiring after attaining age 62 with at least 10 years of
10service credit shall be reduced by 1/2 of 1% for each full
11month that the member's age is under age 67.
12    (c) The maximum retirement annuity provided under Rules 1,
132, 4, and 5 shall be the lesser of (1) the annual limit of
14benefits as specified in Section 415 of the Internal Revenue
15Code of 1986, as such Section may be amended from time to time
16and as such benefit limits shall be adjusted by the
17Commissioner of Internal Revenue, and (2) 80% of final rate of
18earnings.
19    (d) Subject to the provisions of subsection (d-1), a A Tier
201 member whose status as an employee terminates after August
2114, 1969 shall receive automatic increases in his or her
22retirement annuity as follows:
23    Effective January 1 immediately following the date the
24retirement annuity begins, the annuitant shall receive an
25increase in his or her monthly retirement annuity of 0.125% of
26the monthly retirement annuity provided under Rule 1, Rule 2,

 

 

10000SB0011sam003- 117 -LRB100 06001 RPS 21154 a

1Rule 3, or Rule 4 contained in this Section, multiplied by the
2number of full months which elapsed from the date the
3retirement annuity payments began to January 1, 1972, plus
40.1667% of such annuity, multiplied by the number of full
5months which elapsed from January 1, 1972, or the date the
6retirement annuity payments began, whichever is later, to
7January 1, 1978, plus 0.25% of such annuity multiplied by the
8number of full months which elapsed from January 1, 1978, or
9the date the retirement annuity payments began, whichever is
10later, to the effective date of the increase.
11    The annuitant shall receive an increase in his or her
12monthly retirement annuity on each January 1 thereafter during
13the annuitant's life of 3% of the monthly annuity provided
14under Rule 1, Rule 2, Rule 3, or Rule 4 contained in this
15Section. The change made under this subsection by P.A. 81-970
16is effective January 1, 1980 and applies to each annuitant
17whose status as an employee terminates before or after that
18date.
19    Beginning January 1, 1990, and except as provided in
20subsection (d-1), all automatic annual increases payable under
21this Section shall be calculated as a percentage of the total
22annuity payable at the time of the increase, including all
23increases previously granted under this Article.
24    The change made in this subsection by P.A. 85-1008 is
25effective January 26, 1988, and is applicable without regard to
26whether status as an employee terminated before that date.

 

 

10000SB0011sam003- 118 -LRB100 06001 RPS 21154 a

1    (d-1) Notwithstanding any other provision of this Article,
2for a Tier 1 employee who made the election under paragraph (1)
3of subsection (a) of Section 15-132.9:
4        (1) The initial increase in retirement annuity under
5    this Section shall occur on the January 1 occurring either
6    on or after the attainment of age 67 or the fifth
7    anniversary of the annuity start date, whichever is
8    earlier.
9        (2) The amount of each automatic annual increase in
10    retirement annuity or survivor annuity occurring on or
11    after the effective date of that election shall be
12    calculated as a percentage of the originally granted
13    retirement annuity or survivor annuity, equal to 3% or
14    one-half the annual unadjusted percentage increase (but
15    not less than zero) in the consumer price index-u for the
16    12 months ending with the September preceding each November
17    1, whichever is less. If the annual unadjusted percentage
18    change in the consumer price index-u for the 12 months
19    ending with the September preceding each November 1 is zero
20    or there is a decrease, then the annuity shall not be
21    increased.
22    For the purposes of this Section, "consumer price index-u"
23means the index published by the Bureau of Labor Statistics of
24the United States Department of Labor that measures the average
25change in prices of goods and services purchased by all urban
26consumers, United States city average, all items, 1982-84 =

 

 

10000SB0011sam003- 119 -LRB100 06001 RPS 21154 a

1100. The new amount resulting from each annual adjustment shall
2be determined by the Public Pension Division of the Department
3of Insurance and made available to the board of the retirement
4system by November 1 of each year.
5    (d-5) A retirement annuity of a Tier 2 member shall receive
6annual increases on the January 1 occurring either on or after
7the attainment of age 67 or the first anniversary of the
8annuity start date, whichever is later. Each annual increase
9shall be calculated at 3% or one half the annual unadjusted
10percentage increase (but not less than zero) in the consumer
11price index-u for the 12 months ending with the September
12preceding each November 1, whichever is less, of the originally
13granted retirement annuity. If the annual unadjusted
14percentage change in the consumer price index-u for the 12
15months ending with the September preceding each November 1 is
16zero or there is a decrease, then the annuity shall not be
17increased.
18    (e) If, on January 1, 1987, or the date the retirement
19annuity payment period begins, whichever is later, the sum of
20the retirement annuity provided under Rule 1 or Rule 2 of this
21Section and the automatic annual increases provided under the
22preceding subsection or Section 15-136.1, amounts to less than
23the retirement annuity which would be provided by Rule 3, the
24retirement annuity shall be increased as of January 1, 1987, or
25the date the retirement annuity payment period begins,
26whichever is later, to the amount which would be provided by

 

 

10000SB0011sam003- 120 -LRB100 06001 RPS 21154 a

1Rule 3 of this Section. Such increased amount shall be
2considered as the retirement annuity in determining benefits
3provided under other Sections of this Article. This paragraph
4applies without regard to whether status as an employee
5terminated before the effective date of this amendatory Act of
61987, provided that the annuitant was employed at least
7one-half time during the period on which the final rate of
8earnings was based.
9    (f) A participant is entitled to such additional annuity as
10may be provided on an actuarially equivalent basis, by any
11accumulated additional contributions to his or her credit.
12However, the additional contributions made by the participant
13toward the automatic increases in annuity provided under this
14Section shall not be taken into account in determining the
15amount of such additional annuity.
16    (g) If, (1) by law, a function of a governmental unit, as
17defined by Section 20-107 of this Code, is transferred in whole
18or in part to an employer, and (2) a participant transfers
19employment from such governmental unit to such employer within
206 months after the transfer of the function, and (3) the sum of
21(A) the annuity payable to the participant under Rule 1, 2, or
223 of this Section (B) all proportional annuities payable to the
23participant by all other retirement systems covered by Article
2420, and (C) the initial primary insurance amount to which the
25participant is entitled under the Social Security Act, is less
26than the retirement annuity which would have been payable if

 

 

10000SB0011sam003- 121 -LRB100 06001 RPS 21154 a

1all of the participant's pension credits validated under
2Section 20-109 had been validated under this system, a
3supplemental annuity equal to the difference in such amounts
4shall be payable to the participant.
5    (h) On January 1, 1981, an annuitant who was receiving a
6retirement annuity on or before January 1, 1971 shall have his
7or her retirement annuity then being paid increased $1 per
8month for each year of creditable service. On January 1, 1982,
9an annuitant whose retirement annuity began on or before
10January 1, 1977, shall have his or her retirement annuity then
11being paid increased $1 per month for each year of creditable
12service.
13    (i) On January 1, 1987, any annuitant whose retirement
14annuity began on or before January 1, 1977, shall have the
15monthly retirement annuity increased by an amount equal to 8
16per year of creditable service times the number of years that
17have elapsed since the annuity began.
18(Source: P.A. 97-933, eff. 8-10-12; 97-968, eff. 8-16-12;
1998-92, eff. 7-16-13.)
 
20    (40 ILCS 5/15-155)  (from Ch. 108 1/2, par. 15-155)
21    Sec. 15-155. Employer contributions.
22    (a) The State of Illinois shall make contributions by
23appropriations of amounts which, together with the other
24employer contributions from trust, federal, and other funds,
25employee contributions, income from investments, and other

 

 

10000SB0011sam003- 122 -LRB100 06001 RPS 21154 a

1income of this System, will be sufficient to meet the cost of
2maintaining and administering the System on a 90% funded basis
3in accordance with actuarial recommendations.
4    The Board shall determine the amount of State contributions
5required for each fiscal year on the basis of the actuarial
6tables and other assumptions adopted by the Board and the
7recommendations of the actuary, using the formula in subsection
8(a-1).
9    (a-1) For State fiscal years 2018 through 2045 (except as
10otherwise provided for fiscal year 2019), the minimum
11contribution to the System to be made by the State for each
12fiscal year shall be an amount determined by the System to be
13sufficient to bring the total assets of the System up to 90% of
14the total actuarial liabilities of the System by the end of
15State fiscal year 2045. In making these determinations, the
16required State contribution shall be calculated each year as a
17level percentage of total payroll, including payroll that is
18not deemed pensionable, but excluding payroll attributable to
19participants in the defined contribution plan under Section
2015-200.1, over the years remaining to and including fiscal year
212045 and shall be determined under the projected unit credit
22actuarial cost method.
23    For State fiscal year 2019:
24        (1) The initial calculation and certification shall be
25    based on the amount determined above.
26        (2) For purposes of the recertification due on or

 

 

10000SB0011sam003- 123 -LRB100 06001 RPS 21154 a

1    before May 1, 2018, the recalculation of the required State
2    contribution for fiscal year 2019 shall take into account
3    the effect on the System's liabilities of the elections
4    made under Section 15-132.9.
5        (3) For purposes of the recertification due on or
6    before October 1, 2018, the total required State
7    contribution for fiscal year 2019 shall be reduced by the
8    amount of the consideration payments made to Tier 1
9    employees who made the election under paragraph (1) of
10    subsection (a) of Section 15-132.9.
11    Beginning in State fiscal year 2018, any increase or
12decrease in State contribution over the prior fiscal year due
13exclusively to changes in actuarial or investment assumptions
14adopted by the Board shall be included in the State
15contribution to the System, as a percentage of the applicable
16employee payroll, and shall be increased in equal annual
17increments so that by the State fiscal year occurring 5 years
18after the adoption of the actuarial or investment assumptions,
19the State is contributing at the rate otherwise required under
20this Section.
21    For State fiscal years 2012 through 2017 2045, the minimum
22contribution to the System to be made by the State for each
23fiscal year shall be an amount determined by the System to be
24sufficient to bring the total assets of the System up to 90% of
25the total actuarial liabilities of the System by the end of
26State fiscal year 2045. In making these determinations, the

 

 

10000SB0011sam003- 124 -LRB100 06001 RPS 21154 a

1required State contribution shall be calculated each year as a
2level percentage of payroll over the years remaining to and
3including fiscal year 2045 and shall be determined under the
4projected unit credit actuarial cost method.
5    For State fiscal years 1996 through 2005, the State
6contribution to the System, as a percentage of the applicable
7employee payroll, shall be increased in equal annual increments
8so that by State fiscal year 2011, the State is contributing at
9the rate required under this Section.
10    Notwithstanding any other provision of this Article, the
11total required State contribution for State fiscal year 2006 is
12$166,641,900.
13    Notwithstanding any other provision of this Article, the
14total required State contribution for State fiscal year 2007 is
15$252,064,100.
16    For each of State fiscal years 2008 through 2009, the State
17contribution to the System, as a percentage of the applicable
18employee payroll, shall be increased in equal annual increments
19from the required State contribution for State fiscal year
202007, so that by State fiscal year 2011, the State is
21contributing at the rate otherwise required under this Section.
22    Notwithstanding any other provision of this Article, the
23total required State contribution for State fiscal year 2010 is
24$702,514,000 and shall be made from the State Pensions Fund and
25proceeds of bonds sold in fiscal year 2010 pursuant to Section
267.2 of the General Obligation Bond Act, less (i) the pro rata

 

 

10000SB0011sam003- 125 -LRB100 06001 RPS 21154 a

1share of bond sale expenses determined by the System's share of
2total bond proceeds, (ii) any amounts received from the General
3Revenue Fund in fiscal year 2010, (iii) any reduction in bond
4proceeds due to the issuance of discounted bonds, if
5applicable.
6    Notwithstanding any other provision of this Article, the
7total required State contribution for State fiscal year 2011 is
8the amount recertified by the System on or before April 1, 2011
9pursuant to Section 15-165 and shall be made from the State
10Pensions Fund and proceeds of bonds sold in fiscal year 2011
11pursuant to Section 7.2 of the General Obligation Bond Act,
12less (i) the pro rata share of bond sale expenses determined by
13the System's share of total bond proceeds, (ii) any amounts
14received from the General Revenue Fund in fiscal year 2011, and
15(iii) any reduction in bond proceeds due to the issuance of
16discounted bonds, if applicable.
17    Beginning in State fiscal year 2046, the minimum State
18contribution for each fiscal year shall be the amount needed to
19maintain the total assets of the System at 90% of the total
20actuarial liabilities of the System.
21    Amounts received by the System pursuant to Section 25 of
22the Budget Stabilization Act or Section 8.12 of the State
23Finance Act in any fiscal year do not reduce and do not
24constitute payment of any portion of the minimum State
25contribution required under this Article in that fiscal year.
26Such amounts shall not reduce, and shall not be included in the

 

 

10000SB0011sam003- 126 -LRB100 06001 RPS 21154 a

1calculation of, the required State contributions under this
2Article in any future year until the System has reached a
3funding ratio of at least 90%. A reference in this Article to
4the "required State contribution" or any substantially similar
5term does not include or apply to any amounts payable to the
6System under Section 25 of the Budget Stabilization Act.
7    Notwithstanding any other provision of this Section, the
8required State contribution for State fiscal year 2005 and for
9fiscal year 2008 and each fiscal year thereafter, as calculated
10under this Section and certified under Section 15-165, shall
11not exceed an amount equal to (i) the amount of the required
12State contribution that would have been calculated under this
13Section for that fiscal year if the System had not received any
14payments under subsection (d) of Section 7.2 of the General
15Obligation Bond Act, minus (ii) the portion of the State's
16total debt service payments for that fiscal year on the bonds
17issued in fiscal year 2003 for the purposes of that Section
187.2, as determined and certified by the Comptroller, that is
19the same as the System's portion of the total moneys
20distributed under subsection (d) of Section 7.2 of the General
21Obligation Bond Act. In determining this maximum for State
22fiscal years 2008 through 2010, however, the amount referred to
23in item (i) shall be increased, as a percentage of the
24applicable employee payroll, in equal increments calculated
25from the sum of the required State contribution for State
26fiscal year 2007 plus the applicable portion of the State's

 

 

10000SB0011sam003- 127 -LRB100 06001 RPS 21154 a

1total debt service payments for fiscal year 2007 on the bonds
2issued in fiscal year 2003 for the purposes of Section 7.2 of
3the General Obligation Bond Act, so that, by State fiscal year
42011, the State is contributing at the rate otherwise required
5under this Section.
6    (b) If an employee is paid from trust or federal funds, the
7employer shall pay to the Board contributions from those funds
8which are sufficient to cover the accruing normal costs on
9behalf of the employee. However, universities having employees
10who are compensated out of local auxiliary funds, income funds,
11or service enterprise funds are not required to pay such
12contributions on behalf of those employees. The local auxiliary
13funds, income funds, and service enterprise funds of
14universities shall not be considered trust funds for the
15purpose of this Article, but funds of alumni associations,
16foundations, and athletic associations which are affiliated
17with the universities included as employers under this Article
18and other employers which do not receive State appropriations
19are considered to be trust funds for the purpose of this
20Article.
21    (b-1) The City of Urbana and the City of Champaign shall
22each make employer contributions to this System for their
23respective firefighter employees who participate in this
24System pursuant to subsection (h) of Section 15-107. The rate
25of contributions to be made by those municipalities shall be
26determined annually by the Board on the basis of the actuarial

 

 

10000SB0011sam003- 128 -LRB100 06001 RPS 21154 a

1assumptions adopted by the Board and the recommendations of the
2actuary, and shall be expressed as a percentage of salary for
3each such employee. The Board shall certify the rate to the
4affected municipalities as soon as may be practical. The
5employer contributions required under this subsection shall be
6remitted by the municipality to the System at the same time and
7in the same manner as employee contributions.
8    (c) Through State fiscal year 1995: The total employer
9contribution shall be apportioned among the various funds of
10the State and other employers, whether trust, federal, or other
11funds, in accordance with actuarial procedures approved by the
12Board. State of Illinois contributions for employers receiving
13State appropriations for personal services shall be payable
14from appropriations made to the employers or to the System. The
15contributions for Class I community colleges covering earnings
16other than those paid from trust and federal funds, shall be
17payable solely from appropriations to the Illinois Community
18College Board or the System for employer contributions.
19    (d) Beginning in State fiscal year 1996, the required State
20contributions to the System shall be appropriated directly to
21the System and shall be payable through vouchers issued in
22accordance with subsection (c) of Section 15-165, except as
23provided in subsection (g).
24    (e) The State Comptroller shall draw warrants payable to
25the System upon proper certification by the System or by the
26employer in accordance with the appropriation laws and this

 

 

10000SB0011sam003- 129 -LRB100 06001 RPS 21154 a

1Code.
2    (f) Normal costs under this Section means liability for
3pensions and other benefits which accrues to the System because
4of the credits earned for service rendered by the participants
5during the fiscal year and expenses of administering the
6System, but shall not include the principal of or any
7redemption premium or interest on any bonds issued by the Board
8or any expenses incurred or deposits required in connection
9therewith.
10    (g) For academic years beginning on or after June 1, 2005
11and before July 1, 2018, if If the amount of a participant's
12earnings for any academic year used to determine the final rate
13of earnings, determined on a full-time equivalent basis,
14exceeds the amount of his or her earnings with the same
15employer for the previous academic year, determined on a
16full-time equivalent basis, by more than 6%, the participant's
17employer shall pay to the System, in addition to all other
18payments required under this Section and in accordance with
19guidelines established by the System, the present value of the
20increase in benefits resulting from the portion of the increase
21in earnings that is in excess of 6%. This present value shall
22be computed by the System on the basis of the actuarial
23assumptions and tables used in the most recent actuarial
24valuation of the System that is available at the time of the
25computation. The System may require the employer to provide any
26pertinent information or documentation.

 

 

10000SB0011sam003- 130 -LRB100 06001 RPS 21154 a

1    Whenever it determines that a payment is or may be required
2under this subsection (g), the System shall calculate the
3amount of the payment and bill the employer for that amount.
4The bill shall specify the calculations used to determine the
5amount due. If the employer disputes the amount of the bill, it
6may, within 30 days after receipt of the bill, apply to the
7System in writing for a recalculation. The application must
8specify in detail the grounds of the dispute and, if the
9employer asserts that the calculation is subject to subsection
10(h) or (i) of this Section, must include an affidavit setting
11forth and attesting to all facts within the employer's
12knowledge that are pertinent to the applicability of subsection
13(h) or (i). Upon receiving a timely application for
14recalculation, the System shall review the application and, if
15appropriate, recalculate the amount due.
16    The employer contributions required under this subsection
17(g) may be paid in the form of a lump sum within 90 days after
18receipt of the bill. If the employer contributions are not paid
19within 90 days after receipt of the bill, then interest will be
20charged at a rate equal to the System's annual actuarially
21assumed rate of return on investment compounded annually from
22the 91st day after receipt of the bill. Payments must be
23concluded within 3 years after the employer's receipt of the
24bill.
25    When assessing payment for any amount due under this
26subsection (g), the System shall include earnings, to the

 

 

10000SB0011sam003- 131 -LRB100 06001 RPS 21154 a

1extent not established by a participant under Section 15-113.11
2or 15-113.12, that would have been paid to the participant had
3the participant not taken (i) periods of voluntary or
4involuntary furlough occurring on or after July 1, 2015 and on
5or before June 30, 2017 or (ii) periods of voluntary pay
6reduction in lieu of furlough occurring on or after July 1,
72015 and on or before June 30, 2017. Determining earnings that
8would have been paid to a participant had the participant not
9taken periods of voluntary or involuntary furlough or periods
10of voluntary pay reduction shall be the responsibility of the
11employer, and shall be reported in a manner prescribed by the
12System.
13    (g-1) For academic years beginning on or after July 1,
142018, if the amount of a participant's earnings for any
15academic year used to determine the final rate of earnings,
16determined on a full-time equivalent basis, exceeds the amount
17of his or her earnings with the same employer for the previous
18academic year, determined on a full-time equivalent basis, by
19more than the unadjusted percentage increase in the consumer
20price index-u for the calendar year immediately preceding the
21beginning of the academic year, published by the Public Pension
22Division of the Department of Insurance by November 1 of each
23year, then the participant's employer shall pay to the System,
24in addition to all other payments required under this Section
25and in accordance with guidelines established by the System,
26the present value of the increase in benefits resulting from

 

 

10000SB0011sam003- 132 -LRB100 06001 RPS 21154 a

1the portion of the increase in earnings that is in excess of
2the unadjusted percentage increase in the consumer price
3index-u for the applicable calendar year. This present value
4shall be computed by the System on the basis of the actuarial
5assumptions and tables used in the most recent actuarial
6valuation of the System that is available at the time of the
7computation. The System may require the employer to provide any
8pertinent information or documentation.
9    Whenever it determines that a payment is or may be required
10under this subsection (g-1), the System shall calculate the
11amount of the payment and bill the employer for that amount.
12The bill shall specify the calculations used to determine the
13amount due. If the employer disputes the amount of the bill, it
14may, within 30 days after receipt of the bill, apply to the
15System in writing for a recalculation. The application must
16specify in detail the grounds of the dispute and, if the
17employer asserts that the calculation is subject to subsection
18(i-1) of this Section, must include an affidavit setting forth
19and attesting to all facts within the employer's knowledge that
20are pertinent to the applicability of subsection (i-1). Upon
21receiving a timely application for recalculation, the System
22shall review the application and, if appropriate, recalculate
23the amount due.
24    The employer contributions required under this subsection
25(g-1) may be paid in the form of a lump sum within 90 days after
26receipt of the bill. If the employer contributions are not paid

 

 

10000SB0011sam003- 133 -LRB100 06001 RPS 21154 a

1within 90 days after receipt of the bill, then interest shall
2be charged at a rate equal to the System's annual actuarially
3assumed rate of return on investment compounded annually from
4the 91st day after receipt of the bill. Payments must be
5concluded within 3 years after the employer's receipt of the
6bill.
7    For the purposes of this Section, "consumer price index-u"
8means the index published by the Bureau of Labor Statistics of
9the United States Department of Labor that measures the average
10change in prices of goods and services purchased by all urban
11consumers, United States city average, all items, 1982-84 =
12100. The new amount resulting from each annual adjustment shall
13be determined by the Public Pension Division of the Department
14of Insurance and made available to the boards of the retirement
15systems and pension funds by November 1 of each year.
16    (h) This subsection (h) applies only to payments made or
17salary increases given on or after June 1, 2005 but before July
181, 2011. The changes made by Public Act 94-1057 shall not
19require the System to refund any payments received before July
2031, 2006 (the effective date of Public Act 94-1057).
21    When assessing payment for any amount due under subsection
22(g), the System shall exclude earnings increases paid to
23participants under contracts or collective bargaining
24agreements entered into, amended, or renewed before June 1,
252005.
26    When assessing payment for any amount due under subsection

 

 

10000SB0011sam003- 134 -LRB100 06001 RPS 21154 a

1(g), the System shall exclude earnings increases paid to a
2participant at a time when the participant is 10 or more years
3from retirement eligibility under Section 15-135.
4    When assessing payment for any amount due under subsection
5(g), the System shall exclude earnings increases resulting from
6overload work, including a contract for summer teaching, or
7overtime when the employer has certified to the System, and the
8System has approved the certification, that: (i) in the case of
9overloads (A) the overload work is for the sole purpose of
10academic instruction in excess of the standard number of
11instruction hours for a full-time employee occurring during the
12academic year that the overload is paid and (B) the earnings
13increases are equal to or less than the rate of pay for
14academic instruction computed using the participant's current
15salary rate and work schedule; and (ii) in the case of
16overtime, the overtime was necessary for the educational
17mission.
18    When assessing payment for any amount due under subsection
19(g), the System shall exclude any earnings increase resulting
20from (i) a promotion for which the employee moves from one
21classification to a higher classification under the State
22Universities Civil Service System, (ii) a promotion in academic
23rank for a tenured or tenure-track faculty position, or (iii) a
24promotion that the Illinois Community College Board has
25recommended in accordance with subsection (k) of this Section.
26These earnings increases shall be excluded only if the

 

 

10000SB0011sam003- 135 -LRB100 06001 RPS 21154 a

1promotion is to a position that has existed and been filled by
2a member for no less than one complete academic year and the
3earnings increase as a result of the promotion is an increase
4that results in an amount no greater than the average salary
5paid for other similar positions.
6    (i) When assessing payment for any amount due under
7subsection (g), the System shall exclude any salary increase
8described in subsection (h) of this Section given on or after
9July 1, 2011 but before July 1, 2014 under a contract or
10collective bargaining agreement entered into, amended, or
11renewed on or after June 1, 2005 but before July 1, 2011.
12Notwithstanding any other provision of this Section, any
13payments made or salary increases given after June 30, 2014
14shall be used in assessing payment for any amount due under
15subsection (g) of this Section.
16    (i-1) When assessing payment for any amount due under
17subsection (g-1), the System shall exclude salary increases
18paid to participants under contracts or collective bargaining
19agreements entered into, amended, or renewed before the
20effective date of this amendatory Act of the 100th General
21Assembly.
22    (j) The System shall prepare a report and file copies of
23the report with the Governor and the General Assembly by
24January 1, 2007 that contains all of the following information:
25        (1) The number of recalculations required by the
26    changes made to this Section by Public Act 94-1057 for each

 

 

10000SB0011sam003- 136 -LRB100 06001 RPS 21154 a

1    employer.
2        (2) The dollar amount by which each employer's
3    contribution to the System was changed due to
4    recalculations required by Public Act 94-1057.
5        (3) The total amount the System received from each
6    employer as a result of the changes made to this Section by
7    Public Act 94-4.
8        (4) The increase in the required State contribution
9    resulting from the changes made to this Section by Public
10    Act 94-1057.
11    (j-5) For academic years beginning on or after July 1,
122018, if the amount of a participant's earnings for any
13academic year, determined on a full-time equivalent basis,
14exceeds $140,000, the participant's employer shall pay to the
15System, in addition to all other payments required under this
16Section and in accordance with guidelines established by the
17System, the amount of the earnings that exceed $140,000
18multiplied by the level percentage of payroll used in that
19fiscal year, as determined by the System, to be sufficient to
20bring the total assets of the System up to 90% of the total
21actuarial liabilities of the System by the end of State fiscal
22year 2045. This amount shall be computed by the System on the
23basis of the actuarial assumptions and tables used in the most
24recent actuarial valuation of the System that is available at
25the time of the computation. The System may require the
26employer to provide any pertinent information or

 

 

10000SB0011sam003- 137 -LRB100 06001 RPS 21154 a

1documentation.
2    Whenever it determines that a payment is or may be required
3under this subsection, the System shall calculate the amount of
4the payment and bill the employer for that amount. The bill
5shall specify the calculations used to determine the amount
6due. If the employer disputes the amount of the bill, it may,
7within 30 days after receipt of the bill, apply to the System
8in writing for a recalculation. The application must specify in
9detail the grounds of the dispute. Upon receiving a timely
10application for recalculation, the System shall review the
11application and, if appropriate, recalculate the amount due.
12    The employer contributions required under this subsection
13may be paid in the form of a lump sum within 90 days after
14receipt of the bill. If the employer contributions are not paid
15within 90 days after receipt of the bill, then interest will be
16charged at a rate equal to the System's annual actuarially
17assumed rate of return on investment compounded annually from
18the 91st day after receipt of the bill. Payments must be
19concluded within 3 years after the employer's receipt of the
20bill.
21    (k) The Illinois Community College Board shall adopt rules
22for recommending lists of promotional positions submitted to
23the Board by community colleges and for reviewing the
24promotional lists on an annual basis. When recommending
25promotional lists, the Board shall consider the similarity of
26the positions submitted to those positions recognized for State

 

 

10000SB0011sam003- 138 -LRB100 06001 RPS 21154 a

1universities by the State Universities Civil Service System.
2The Illinois Community College Board shall file a copy of its
3findings with the System. The System shall consider the
4findings of the Illinois Community College Board when making
5determinations under this Section. The System shall not exclude
6any earnings increases resulting from a promotion when the
7promotion was not submitted by a community college. Nothing in
8this subsection (k) shall require any community college to
9submit any information to the Community College Board.
10    (l) For purposes of determining the required State
11contribution to the System, the value of the System's assets
12shall be equal to the actuarial value of the System's assets,
13which shall be calculated as follows:
14    As of June 30, 2008, the actuarial value of the System's
15assets shall be equal to the market value of the assets as of
16that date. In determining the actuarial value of the System's
17assets for fiscal years after June 30, 2008, any actuarial
18gains or losses from investment return incurred in a fiscal
19year shall be recognized in equal annual amounts over the
205-year period following that fiscal year.
21    (m) For purposes of determining the required State
22contribution to the system for a particular year, the actuarial
23value of assets shall be assumed to earn a rate of return equal
24to the system's actuarially assumed rate of return.
25    (n) If Section 15-132.9 is determined to be
26unconstitutional or otherwise invalid by a final unappealable

 

 

10000SB0011sam003- 139 -LRB100 06001 RPS 21154 a

1decision of an Illinois court or a court of competent
2jurisdiction, then the changes made to this Section by this
3amendatory Act of the 100th General Assembly shall not take
4effect and are repealed by operation of law.
5(Source: P.A. 98-92, eff. 7-16-13; 98-463, eff. 8-16-13;
699-897, eff. 1-1-17.)
 
7    (40 ILCS 5/15-157)  (from Ch. 108 1/2, par. 15-157)
8    Sec. 15-157. Employee Contributions.
9    (a) Each participating employee shall make contributions
10towards the retirement benefits payable under the retirement
11program applicable to the employee from each payment of
12earnings applicable to employment under this system on and
13after the date of becoming a participant as follows: Prior to
14September 1, 1949, 3 1/2% of earnings; from September 1, 1949
15to August 31, 1955, 5%; from September 1, 1955 to August 31,
161969, 6%; from September 1, 1969, 6 1/2%. These contributions
17are to be considered as normal contributions for purposes of
18this Article.
19    Each participant who is a police officer or firefighter
20shall make normal contributions of 8% of each payment of
21earnings applicable to employment as a police officer or
22firefighter under this system on or after September 1, 1981,
23unless he or she files with the board within 60 days after the
24effective date of this amendatory Act of 1991 or 60 days after
25the board receives notice that he or she is employed as a

 

 

10000SB0011sam003- 140 -LRB100 06001 RPS 21154 a

1police officer or firefighter, whichever is later, a written
2notice waiving the retirement formula provided by Rule 4 of
3Section 15-136. This waiver shall be irrevocable. If a
4participant had met the conditions set forth in Section
515-132.1 prior to the effective date of this amendatory Act of
61991 but failed to make the additional normal contributions
7required by this paragraph, he or she may elect to pay the
8additional contributions plus compound interest at the
9effective rate. If such payment is received by the board, the
10service shall be considered as police officer service in
11calculating the retirement annuity under Rule 4 of Section
1215-136. While performing service described in clause (i) or
13(ii) of Rule 4 of Section 15-136, a participating employee
14shall be deemed to be employed as a firefighter for the purpose
15of determining the rate of employee contributions under this
16Section.
17    (b) Starting September 1, 1969, each participating
18employee shall make additional contributions of 1/2 of 1% of
19earnings to finance a portion of the cost of the annual
20increases in retirement annuity provided under Section 15-136,
21except that with respect to participants in the self-managed
22plan this additional contribution shall be used to finance the
23benefits obtained under that retirement program. Beginning
24July 1, 2018 or the effective date of the Tier 1 employee's
25election under paragraph (1) of subsection (a) of Section
2615-132.9, whichever is later, each Tier 1 employee who made the

 

 

10000SB0011sam003- 141 -LRB100 06001 RPS 21154 a

1election under paragraph (1) of subsection (a) of Section
215-132.9 is no longer required to make contributions under this
3subsection.
4    (c) Except as provided in subsection (c-5), in In addition
5to the amounts described in subsections (a) and (b) of this
6Section, each participating employee shall make contributions
7of 1% of earnings applicable under this system on and after
8August 1, 1959. The contributions made under this subsection
9(c) shall be considered as survivor's insurance contributions
10for purposes of this Article if the employee is covered under
11the traditional benefit package, and such contributions shall
12be considered as additional contributions for purposes of this
13Article if the employee is participating in the self-managed
14plan or has elected to participate in the portable benefit
15package and has completed the applicable one-year waiting
16period. Contributions in excess of $80 during any fiscal year
17beginning before August 31, 1969 and in excess of $120 during
18any fiscal year thereafter until September 1, 1971 shall be
19considered as additional contributions for purposes of this
20Article.
21    (c-5) Beginning July 1, 2018 or the effective date of the
22Tier 1 employee's election under paragraph (1) of subsection
23(a) of Section 15-132.9, whichever is later, in lieu of the
24contributions otherwise required under subsection (c), each
25Tier 1 employee who made the election under paragraph (1) of
26subsection (a) of Section 15-132.9 shall make contributions of

 

 

10000SB0011sam003- 142 -LRB100 06001 RPS 21154 a

10.7% of earnings applicable under this System and each Tier 1
2employee who is a police officer or firefighter who makes
3normal contributions of 8% of each payment of earnings
4applicable to employment as a police officer or firefighter
5under this System and who made the election under paragraph (1)
6of subsection (a) of Section 15-132.9 shall make contributions
7of 0.55% of earnings applicable under this System. The
8contributions made under this subsection (c-5) shall be
9considered as survivor's insurance contributions for purposes
10of this Article and such contributions shall be considered as
11additional contributions for purposes of this Article if the
12employee has elected to participate in the portable benefit
13package and has completed the applicable one-year waiting
14period.
15    (d) If the board by board rule so permits and subject to
16such conditions and limitations as may be specified in its
17rules, a participant may make other additional contributions of
18such percentage of earnings or amounts as the participant shall
19elect in a written notice thereof received by the board.
20    (e) That fraction of a participant's total accumulated
21normal contributions, the numerator of which is equal to the
22number of years of service in excess of that which is required
23to qualify for the maximum retirement annuity, and the
24denominator of which is equal to the total service of the
25participant, shall be considered as accumulated additional
26contributions. The determination of the applicable maximum

 

 

10000SB0011sam003- 143 -LRB100 06001 RPS 21154 a

1annuity and the adjustment in contributions required by this
2provision shall be made as of the date of the participant's
3retirement.
4    (f) Notwithstanding the foregoing, a participating
5employee shall not be required to make contributions under this
6Section after the date upon which continuance of such
7contributions would otherwise cause his or her retirement
8annuity to exceed the maximum retirement annuity as specified
9in clause (1) of subsection (c) of Section 15-136.
10    (g) A participant may make contributions for the purchase
11of service credit under this Article; however, only a
12participating employee may make optional contributions under
13subsection (b) of Section 15-157.1 of this Article.
14    (h) A Tier 2 member shall not make contributions on
15earnings that exceed the limitation as prescribed under
16subsection (b) of Section 15-111 of this Article.
17(Source: P.A. 98-92, eff. 7-16-13; 99-450, eff. 8-24-15.)
 
18    (40 ILCS 5/15-165)   (from Ch. 108 1/2, par. 15-165)
19    (Text of Section WITHOUT the changes made by P.A. 98-599,
20which has been held unconstitutional)
21    Sec. 15-165. To certify amounts and submit vouchers.
22    (a) The Board shall certify to the Governor on or before
23November 15 of each year until November 15, 2011 the
24appropriation required from State funds for the purposes of
25this System for the following fiscal year. The certification

 

 

10000SB0011sam003- 144 -LRB100 06001 RPS 21154 a

1under this subsection (a) shall include a copy of the actuarial
2recommendations upon which it is based and shall specifically
3identify the System's projected State normal cost for that
4fiscal year and the projected State cost for the self-managed
5plan for that fiscal year.
6    On or before May 1, 2004, the Board shall recalculate and
7recertify to the Governor the amount of the required State
8contribution to the System for State fiscal year 2005, taking
9into account the amounts appropriated to and received by the
10System under subsection (d) of Section 7.2 of the General
11Obligation Bond Act.
12    On or before July 1, 2005, the Board shall recalculate and
13recertify to the Governor the amount of the required State
14contribution to the System for State fiscal year 2006, taking
15into account the changes in required State contributions made
16by this amendatory Act of the 94th General Assembly.
17    On or before April 1, 2011, the Board shall recalculate and
18recertify to the Governor the amount of the required State
19contribution to the System for State fiscal year 2011, applying
20the changes made by Public Act 96-889 to the System's assets
21and liabilities as of June 30, 2009 as though Public Act 96-889
22was approved on that date.
23    (a-5) On or before November 1 of each year, beginning
24November 1, 2012, the Board shall submit to the State Actuary,
25the Governor, and the General Assembly a proposed certification
26of the amount of the required State contribution to the System

 

 

10000SB0011sam003- 145 -LRB100 06001 RPS 21154 a

1for the next fiscal year, along with all of the actuarial
2assumptions, calculations, and data upon which that proposed
3certification is based. On or before January 1 of each year,
4beginning January 1, 2013, the State Actuary shall issue a
5preliminary report concerning the proposed certification and
6identifying, if necessary, recommended changes in actuarial
7assumptions that the Board must consider before finalizing its
8certification of the required State contributions. On or before
9January 15, 2013 and each January 15 thereafter, the Board
10shall certify to the Governor and the General Assembly the
11amount of the required State contribution for the next fiscal
12year. The Board's certification must note, in a written
13response to the State Actuary, any deviations from the State
14Actuary's recommended changes, the reason or reasons for not
15following the State Actuary's recommended changes, and the
16fiscal impact of not following the State Actuary's recommended
17changes on the required State contribution.
18    (a-10) As soon as practical after the effective date of
19this amendatory Act of the 100th General Assembly, the State
20Actuary and the Board shall recalculate and recertify to the
21Governor and the General Assembly the amount of the State
22contribution to the System for State fiscal year 2018, taking
23into account the changes in required State contributions made
24by this amendatory Act of the 100th General Assembly.
25    (a-15) On or before May 1, 2018, the Board shall
26recalculate and recertify to the Governor and the General

 

 

10000SB0011sam003- 146 -LRB100 06001 RPS 21154 a

1Assembly the amount of the required State contribution to the
2System for State fiscal year 2019, taking into account the
3effect on the System's liabilities of the elections made under
4Section 15-132.9.
5    On or before October 1, 2018, the Board shall recalculate
6and recertify to the Governor and the General Assembly the
7amount of the required State contribution to the System for
8State fiscal year 2019, taking into account the reduction
9specified under item (3) of subsection (a-1) of Section 15-155.
10    (b) The Board shall certify to the State Comptroller or
11employer, as the case may be, from time to time, by its
12chairperson and secretary, with its seal attached, the amounts
13payable to the System from the various funds.
14    (c) Beginning in State fiscal year 1996, on or as soon as
15possible after the 15th day of each month the Board shall
16submit vouchers for payment of State contributions to the
17System, in a total monthly amount of one-twelfth of the
18required annual State contribution certified under subsection
19(a). From the effective date of this amendatory Act of the 93rd
20General Assembly through June 30, 2004, the Board shall not
21submit vouchers for the remainder of fiscal year 2004 in excess
22of the fiscal year 2004 certified contribution amount
23determined under this Section after taking into consideration
24the transfer to the System under subsection (b) of Section
256z-61 of the State Finance Act. These vouchers shall be paid by
26the State Comptroller and Treasurer by warrants drawn on the

 

 

10000SB0011sam003- 147 -LRB100 06001 RPS 21154 a

1funds appropriated to the System for that fiscal year.
2    If in any month the amount remaining unexpended from all
3other appropriations to the System for the applicable fiscal
4year (including the appropriations to the System under Section
58.12 of the State Finance Act and Section 1 of the State
6Pension Funds Continuing Appropriation Act) is less than the
7amount lawfully vouchered under this Section, the difference
8shall be paid from the General Revenue Fund under the
9continuing appropriation authority provided in Section 1.1 of
10the State Pension Funds Continuing Appropriation Act.
11    (d) So long as the payments received are the full amount
12lawfully vouchered under this Section, payments received by the
13System under this Section shall be applied first toward the
14employer contribution to the self-managed plan established
15under Section 15-158.2. Payments shall be applied second toward
16the employer's portion of the normal costs of the System, as
17defined in subsection (f) of Section 15-155. The balance shall
18be applied toward the unfunded actuarial liabilities of the
19System.
20    (e) In the event that the System does not receive, as a
21result of legislative enactment or otherwise, payments
22sufficient to fully fund the employer contribution to the
23self-managed plan established under Section 15-158.2 and to
24fully fund that portion of the employer's portion of the normal
25costs of the System, as calculated in accordance with Section
2615-155(a-1), then any payments received shall be applied

 

 

10000SB0011sam003- 148 -LRB100 06001 RPS 21154 a

1proportionately to the optional retirement program established
2under Section 15-158.2 and to the employer's portion of the
3normal costs of the System, as calculated in accordance with
4Section 15-155(a-1).
5(Source: P.A. 97-694, eff. 6-18-12; 98-92, eff. 7-16-13.)
 
6    (40 ILCS 5/15-185.5 new)
7    Sec. 15-185.5. Accelerated pension benefit payment.
8    (a) As used in this Section:
9    "Eligible person" means a person who:
10        (1) has terminated service;
11        (2) has accrued sufficient service credit to be
12    eligible to receive a retirement annuity under this
13    Article;
14        (3) has not received any retirement annuity under this
15    Article;
16        (4) does not have a QILDRO in effect against him or her
17    under this Article; and
18        (5) is not a participant in the self-managed plan under
19    Section 15-158.2.
20    "Pension benefit" means the benefits under this Article, or
21Article 1 as it relates to those benefits, including any
22anticipated annual increases, that an eligible person is
23entitled to upon attainment of the applicable retirement age.
24"Pension benefit" also includes applicable survivor's or
25disability benefits.

 

 

10000SB0011sam003- 149 -LRB100 06001 RPS 21154 a

1    (b) Before January 1, 2018, and annually thereafter, the
2System shall calculate, using actuarial tables and other
3assumptions adopted by the Board, the net present value of
4pension benefits for each eligible person and shall offer each
5eligible person the opportunity to irrevocably elect to receive
6an amount determined by the System to be equal to 70% of the
7net present value of his or her pension benefits in lieu of
8receiving any pension benefit. The offer shall specify the
9dollar amount that the eligible person will receive if he or
10she so elects and shall expire when a subsequent offer is made
11to an eligible person or when the System determines that 10% of
12eligible persons in that year have made the election under this
13subsection, whichever occurs first. The System shall make a
14good faith effort to contact every eligible person to notify
15him or her of the election and of the amount of the accelerated
16pension benefit payment.
17    Until the System determines that 10% of eligible persons in
18that year have made the election under this subsection, an
19eligible person may irrevocably elect to receive an accelerated
20pension benefit payment in the amount that the System offers
21under this subsection in lieu of receiving any pension benefit.
22A person who elects to receive an accelerated pension benefit
23payment under this Section may not elect to proceed under the
24Retirement Systems Reciprocal Act with respect to service under
25this Article.
26    (c) A person's credits and creditable service under this

 

 

10000SB0011sam003- 150 -LRB100 06001 RPS 21154 a

1Article shall be terminated upon the person's receipt of an
2accelerated pension benefit payment under this Section, and no
3other benefit shall be paid under this Article based on those
4terminated credits and creditable service, including any
5retirement, survivor, or other benefit; except that to the
6extent that participation, benefits, or premiums under the
7State Employees Group Insurance Act of 1971 are based on the
8amount of service credit, the terminated service credit shall
9be used for that purpose.
10    (d) If a person who has received an accelerated pension
11benefit payment under this Section returns to participating
12employee status under this Article, then:
13        (1) Any benefits under the System earned as a result of
14    that return to participating employee status shall be based
15    solely on the person's credits and creditable service
16    arising from the return to participating employee status.
17        (2) The accelerated pension benefit payment may not be
18    repaid to the System, and the terminated credits and
19    creditable service may not under any circumstances be
20    reinstated.
21    (e) As a condition of receiving an accelerated pension
22benefit payment, an eligible person must have another
23retirement plan or account qualified under the Internal Revenue
24Code of 1986, as amended, for the accelerated pension benefit
25payment to be rolled into. The accelerated pension benefit
26payment under this Section may be subject to withholding or

 

 

10000SB0011sam003- 151 -LRB100 06001 RPS 21154 a

1payment of applicable taxes, but to the extent permitted by
2federal law, a person who receives an accelerated pension
3benefit payment under this Section must direct the System to
4pay all of that payment as a rollover into another retirement
5plan or account qualified under the Internal Revenue Code of
61986, as amended.
7    (f) Before January 1, 2019 and every January 1 thereafter,
8the Board shall certify to the Illinois Finance Authority and
9the General Assembly the amount by which the total amount of
10accelerated pension benefit payments made under this Section
11exceed the amount appropriated to the System for the purpose of
12making those payments.
13    (g) The Board shall adopt any rules necessary to implement
14this Section.
15    (h) No provision of this Section shall be interpreted in a
16way that would cause the applicable System to cease to be a
17qualified plan under the Internal Revenue Code of 1986.
18    (i) Notwithstanding any other provision of this Section, in
19no case shall the total amount of accelerated pension benefit
20payments paid under this Section, Section 14-147.5, and Section
2116-190.5 cause the Illinois Finance Authority to issue more
22than the $250,000,000 of State Pension Obligation Acceleration
23Bonds authorized in subsection (c-5) of Section 801-40 of the
24Illinois Finance Authority Act.
 
25    (40 ILCS 5/15-198)

 

 

10000SB0011sam003- 152 -LRB100 06001 RPS 21154 a

1    (Text of Section WITHOUT the changes made by P.A. 98-599,
2which has been held unconstitutional)
3    Sec. 15-198. Application and expiration of new benefit
4increases.
5    (a) As used in this Section, "new benefit increase" means
6an increase in the amount of any benefit provided under this
7Article, or an expansion of the conditions of eligibility for
8any benefit under this Article, that results from an amendment
9to this Code that takes effect after the effective date of this
10amendatory Act of the 94th General Assembly. "New benefit
11increase", however, does not include any benefit increase
12resulting from the changes made to this Article by this
13amendatory Act of the 100th General Assembly.
14    (b) Notwithstanding any other provision of this Code or any
15subsequent amendment to this Code, every new benefit increase
16is subject to this Section and shall be deemed to be granted
17only in conformance with and contingent upon compliance with
18the provisions of this Section.
19    (c) The Public Act enacting a new benefit increase must
20identify and provide for payment to the System of additional
21funding at least sufficient to fund the resulting annual
22increase in cost to the System as it accrues.
23    Every new benefit increase is contingent upon the General
24Assembly providing the additional funding required under this
25subsection. The Commission on Government Forecasting and
26Accountability shall analyze whether adequate additional

 

 

10000SB0011sam003- 153 -LRB100 06001 RPS 21154 a

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

 

 

10000SB0011sam003- 154 -LRB100 06001 RPS 21154 a

1apply and qualify for the affected benefit while the new
2benefit increase was in effect.
3(Source: P.A. 94-4, eff. 6-1-05.)
 
4    (40 ILCS 5/15-200.1 new)
5    Sec. 15-200.1. Defined contribution plan.
6    (a) By July 1, 2018, the System shall prepare and implement
7a voluntary defined contribution plan for up to 5% of eligible
8Tier 1 employees. The System shall determine the 5% cap by the
9number of Tier 1 employees on the effective date of this
10Section. The defined contribution plan developed under this
11Section shall be a plan that aggregates employer and employee
12contributions in individual participant accounts which, after
13meeting any other requirements, are used for payouts after
14retirement in accordance with this Section and any other
15applicable laws.
16    As used in this Section, "defined benefit plan" means the
17retirement plan available under this Article to Tier 1
18employees who have not made the election authorized under this
19Section.
20        (1) Under the defined contribution plan, a Tier 1
21    employee of this System could elect to cease accruing
22    benefits in the defined benefit plan under this Article and
23    begin accruing benefits for future service in the defined
24    contribution plan. Service credit under the defined
25    contribution plan may be used for determining retirement

 

 

10000SB0011sam003- 155 -LRB100 06001 RPS 21154 a

1    eligibility under the defined benefit plan. A Tier 1
2    employee who elects to cease accruing benefits in his or
3    her defined benefit plan shall be prohibited from
4    purchasing service credit on or after the date of his or
5    her election. A Tier 1 employee making the irrevocable
6    election provided under this Section shall not receive
7    interest accruals to his or her Rule 2 benefit on or after
8    the date of his or her election.
9        (2) Participants in the defined contribution plan
10    shall pay employee contributions at the same rate as other
11    participants under this Article as determined by the
12    System.
13        (3) State contributions shall be paid into the accounts
14    of all participants in the defined contribution plan at a
15    uniform rate, expressed as a percentage of earnings and
16    determined for each year. This rate shall be no higher than
17    the employer's normal cost for Tier 1 employees in the
18    defined benefit plan for that year, as determined by the
19    System and expressed as a percentage of earnings, and shall
20    be no lower than 3% of earnings. The State shall adjust
21    this rate annually.
22        (4) The defined contribution plan shall require 5 years
23    of participation in the defined contribution plan before
24    vesting in State contributions. If the participant fails to
25    vest in them, the State contributions, and the earnings
26    thereon, shall be forfeited.

 

 

10000SB0011sam003- 156 -LRB100 06001 RPS 21154 a

1        (5) The defined contribution plan may provide for
2    participants in the plan to be eligible for the defined
3    disability benefits available to other participants under
4    this Article. If it does, the System shall reduce the
5    employee contributions credited to the member's defined
6    contribution plan account by an amount determined by the
7    System to cover the cost of offering such benefits.
8        (6) The defined contribution plan shall provide a
9    variety of options for investments. These options shall
10    include investments handled by the System as well as
11    private sector investment options.
12        (7) The defined contribution plan shall provide a
13    variety of options for payouts to retirees and their
14    survivors.
15        (8) To the extent authorized under federal law and as
16    authorized by the System, the plan shall allow former
17    participants in the plan to transfer or roll over employee
18    and vested State contributions, and the earnings thereon,
19    into other qualified retirement plans.
20        (9) The System shall reduce the employee contributions
21    credited to the member's defined contribution plan account
22    by an amount determined by the System to cover the cost of
23    offering these benefits and any applicable administrative
24    fees.
25    (b) Only persons who are Tier 1 employees of the System on
26the effective date of this Section are eligible to participate

 

 

10000SB0011sam003- 157 -LRB100 06001 RPS 21154 a

1in the defined contribution plan. Participation in the defined
2contribution plan shall be limited to the first 5% of eligible
3persons who elect to participate. The election to participate
4in the defined contribution plan is voluntary and irrevocable.
5    (c) An eligible Tier 1 employee may irrevocably elect to
6participate in the defined contribution plan by filing with the
7System a written application to participate that is received by
8the System prior to its determination that 5% of eligible
9persons have elected to participate in the defined contribution
10plan.
11    When the System first determines that 5% of eligible
12persons have elected to participate in the defined contribution
13plan, the System shall provide notice to previously eligible
14employees that the plan is no longer available and shall cease
15accepting applications to participate.
16    (d) The System shall make a good faith effort to contact
17each Tier 1 employee who is eligible to participate in the
18defined contribution plan. The System shall mail information
19describing the option to join the defined contribution plan to
20each of these employees to his or her last known address on
21file with the System. If the employee is not responsive to
22other means of contact, it is sufficient for the System to
23publish the details of the option on its website.
24    Upon request for further information describing the
25option, the System shall provide employees with information
26from the System before exercising the option to join the plan,

 

 

10000SB0011sam003- 158 -LRB100 06001 RPS 21154 a

1including information on the impact to their vested benefits or
2non-vested service. The individual consultation shall include
3projections of the member's defined benefits at retirement or
4earlier termination of service and the value of the member's
5account at retirement or earlier termination of service. The
6System shall not provide advice or counseling with respect to
7whether the employee should exercise the option. The System
8shall inform Tier 1 employees who are eligible to participate
9in the defined contribution plan that they may also wish to
10obtain information and counsel relating to their option from
11any other available source, including but not limited to labor
12organizations, private counsel, and financial advisors.
13    (e) In no event shall the System, its staff, its authorized
14representatives, or the Board be liable for any information
15given to an employee under this Section. The System may
16coordinate with the Illinois Department of Central Management
17Services and other retirement systems administering a defined
18contribution plan in accordance with this amendatory Act of the
19100th General Assembly to provide information concerning the
20impact of the option set forth in this Section.
21    (f) Notwithstanding any other provision of this Section, no
22person shall begin participating in the defined contribution
23plan until it has attained qualified plan status and received
24all necessary approvals from the U.S. Internal Revenue Service.
25    (g) The System shall report on its progress under this
26Section, including the available details of the defined

 

 

10000SB0011sam003- 159 -LRB100 06001 RPS 21154 a

1contribution plan and the System's plans for informing eligible
2Tier 1 employees about the plan, to the Governor and the
3General Assembly on or before January 15, 2018.
4    (h) If a Tier 1 employee has not made an election under
5Section 15-134.5 of this Code, then the plan prescribed under
6this Section shall not apply to that Tier 1 employee and that
7Tier 1 employee shall remain eligible to make the election
8prescribed under Section 15-134.5.
9    (i) The intent of this amendatory Act of the 100th General
10Assembly is to ensure that the State's normal cost of
11participation in the defined contribution plan is similar, and
12if possible equal, to the State's normal cost of participation
13in the defined benefit plan, unless a lower State's normal cost
14is necessary to ensure cost neutrality.
15    (j) If Section 15-132.9 is determined to be
16unconstitutional or otherwise invalid by a final unappealable
17decision of an Illinois court or a court of competent
18jurisdiction, then this Section shall not take effect and is
19repealed by operation of law.
 
20    (40 ILCS 5/15-201.1 new)
21    Sec. 15-201.1. Defined contribution plan; termination. If
22the defined contribution plan is terminated or becomes
23inoperative pursuant to law, then each participant in the plan
24shall automatically be deemed to have been a contributing Tier
251 employee participating in the System's defined benefit plan

 

 

10000SB0011sam003- 160 -LRB100 06001 RPS 21154 a

1during the time in which he or she participated in the defined
2contribution plan, and for that purpose the System shall be
3entitled to recover the amounts in the participant's defined
4contribution accounts.
 
5    (40 ILCS 5/16-107.1 new)
6    Sec. 16-107.1. Tier 1 employee. "Tier 1 employee": A
7teacher under this Article who first became a member or
8participant before January 1, 2011 under any reciprocal
9retirement system or pension fund established under this Code
10other than a retirement system or pension fund established
11under Article 2, 3, 4, 5, 6, or 18 of this Code. However, for
12the purposes of the election under Section 16-122.9, "Tier 1
13employee" does not include a teacher under this Article who
14would qualify as a Tier 1 employee but who has made an
15irrevocable election on or before June 1, 2017 to retire from
16service pursuant to the terms of an employment contract or a
17collective bargaining agreement in effect on June 1, 2017,
18excluding any extension, amendment, or renewal of that
19agreement after that date, and has notified the System of that
20election.
 
21    (40 ILCS 5/16-121)  (from Ch. 108 1/2, par. 16-121)
22    (Text of Section WITHOUT the changes made by P.A. 98-599,
23which has been held unconstitutional)
24    Sec. 16-121. Salary. "Salary": The actual compensation

 

 

10000SB0011sam003- 161 -LRB100 06001 RPS 21154 a

1received by a teacher during any school year and recognized by
2the system in accordance with rules of the board. For purposes
3of this Section, "school year" includes the regular school term
4plus any additional period for which a teacher is compensated
5and such compensation is recognized by the rules of the board.
6    Notwithstanding any other provision of this Section,
7"salary" does not include any future increase in income that is
8offered by an employer for service as a Tier 1 employee under
9this Article pursuant to the condition set forth in subsection
10(c) of Section 16-122.9 and accepted under that condition by a
11Tier 1 employee who has made the election under paragraph (2)
12of subsection (a) of Section 16-122.9.
13    Notwithstanding any other provision of this Section,
14"salary" does not include any consideration payment made to a
15Tier 1 employee.
16(Source: P.A. 84-1028.)
 
17    (40 ILCS 5/16-121.1 new)
18    Sec. 16-121.1. Future increase in income. "Future increase
19in income" means an increase to a Tier 1 employee's base pay
20that is offered by an employer to the Tier 1 employee for
21service under this Article after June 30, 2018 that qualifies
22as "salary", as defined in Section 16-121, or would qualify as
23"salary" but for the fact that it was offered to and accepted
24by the Tier 1 employee under the condition set forth in
25subsection (c) of Section 16-122.9. The term "future increase

 

 

10000SB0011sam003- 162 -LRB100 06001 RPS 21154 a

1in income" includes an increase to a Tier 1 employee's base pay
2that is paid to the Tier 1 employee pursuant to an extension,
3amendment, or renewal of any such employment contract or
4collective bargaining agreement after the effective date of
5this Section.
 
6    (40 ILCS 5/16-121.2 new)
7    Sec. 16-121.2. Base pay. As used in Section 16-121.1 of
8this Code, "base pay" means the greater of either (i) the Tier
91 employee's annualized rate of salary as of June 30, 2018, or
10(ii) the Tier 1 employee's annualized rate of salary
11immediately preceding the expiration, renewal, or amendment of
12an employment contract or collective bargaining agreement in
13effect on the effective date of this Section. For a person
14returning to active service as a Tier 1 employee after June 30,
152018, however, "base pay" means the employee's annualized rate
16of salary as of the employee's last date of service prior to
17July 1, 2018. The System shall calculate the base pay of each
18Tier 1 employee pursuant to this Section.
 
19    (40 ILCS 5/16-122.9 new)
20    Sec. 16-122.9. Election by Tier 1 employees.
21    (a) Each active Tier 1 employee shall make an irrevocable
22election either:
23        (1) to agree to delay his or her eligibility for
24    automatic annual increases in retirement annuity as

 

 

10000SB0011sam003- 163 -LRB100 06001 RPS 21154 a

1    provided in subsection (a-1) of Section 16-133.1 or
2    subsection (b-1) of Section 16-136.1, whichever is
3    applicable, and to have the amount of the automatic annual
4    increases in his or her retirement annuity and survivor
5    benefit that are otherwise provided for in this Article
6    calculated, instead, as provided in subsection (a-1) of
7    Section 16-133.1 or subsection (b-1) of Section 16-136.1,
8    whichever is applicable; or
9        (2) to not agree to paragraph (1) of this subsection.
10    The election required under this subsection (a) shall be
11made by each active Tier 1 employee no earlier than January 1,
122018 and no later than March 31, 2018, except that:
13        (i) a person who becomes a Tier 1 employee under this
14    Article on or after February 1, 2018 must make the election
15    under this subsection (a) within 60 days after becoming a
16    Tier 1 employee; and
17        (ii) a person who returns to active service as a Tier 1
18    employee under this Article on or after February 1, 2018
19    and has not yet made an election under this Section must
20    make the election under this subsection (a) within 60 days
21    after returning to active service as a Tier 1 employee.
22    If a Tier 1 employee fails for any reason to make a
23required election under this subsection within the time
24specified, then the employee shall be deemed to have made the
25election under paragraph (2) of this subsection.
26    (a-5) If this Section is enjoined or stayed by an Illinois

 

 

10000SB0011sam003- 164 -LRB100 06001 RPS 21154 a

1court or a court of competent jurisdiction pending the entry of
2a final and unappealable decision, and this Section is
3determined to be constitutional or otherwise valid by a final
4unappealable decision of an Illinois court or a court of
5competent jurisdiction, then the election procedure set forth
6in subsection (a) of this Section shall commence on the 180th
7calendar day after the date of the issuance of the final
8unappealable decision and shall conclude at the end of the
9270th calendar day after that date.
10    (a-10) All elections under subsection (a) that are made or
11deemed to be made before July 1, 2018 shall take effect on July
121, 2018. Elections that are made or deemed to be made on or
13after July 1, 2018 shall take effect on the first day of the
14month following the month in which the election is made or
15deemed to be made.
16    (b) As adequate and legal consideration provided under this
17amendatory Act of the 100th General Assembly for making an
18election under paragraph (1) of subsection (a) of this Section,
19an employer shall be expressly and irrevocably prohibited from
20offering any future increases in income to a Tier 1 employee
21who has made an election under paragraph (1) of subsection (a)
22of this Section on the condition of not constituting salary
23under Section 16-121.
24    As adequate and legal consideration provided under this
25amendatory Act of the 100th General Assembly for making an
26election under paragraph (1) of subsection (a) of this Section,

 

 

10000SB0011sam003- 165 -LRB100 06001 RPS 21154 a

1each Tier 1 employee who has made an election under paragraph
2(1) of subsection (a) of this Section shall receive a
3consideration payment equal to 10% of the contributions made by
4or on behalf of the employee under paragraphs (1), (2), and (3)
5of subsection (a) of Section 16-152 before the effective date
6of that election. The State Comptroller shall pay the
7consideration payment to the Tier 1 employee out of funds
8appropriated for that purpose under Section 1.9 of the State
9Pension Funds Continuing Appropriation Act. The System shall
10calculate the amount of each consideration payment and, by July
111, 2018, shall certify to the State Comptroller the amount of
12the consideration payment, together with the name, address, and
13any other available payment information of the Tier 1 employee
14as found in the records of the System. The System shall make
15additional calculations and certifications of consideration
16payments to the State Comptroller as the System deems
17necessary.
18    (c) A Tier 1 employee who makes the election under
19paragraph (2) of subsection (a) of this Section shall not be
20subject to paragraph (1) of subsection (a) of this Section.
21However, each future increase in income offered by an employer
22under this Article to a Tier 1 employee who has made the
23election under paragraph (2) of subsection (a) of this Section
24shall be offered by the employer expressly and irrevocably on
25the condition of not constituting salary under Section 16-121
26and that the Tier 1 employee's acceptance of the offered future

 

 

10000SB0011sam003- 166 -LRB100 06001 RPS 21154 a

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

 

 

10000SB0011sam003- 167 -LRB100 06001 RPS 21154 a

1packet required under this subsection that the Tier 1 employee
2may also wish to obtain information and counsel relating to the
3election required under this Section from any other available
4source, including, but not limited to, labor organizations and
5private counsel.
6    In no event shall the System, its staff, or the Board be
7held liable for any information given to a member regarding the
8elections under this Section. The System shall coordinate with
9the Illinois Department of Central Management Services and each
10other retirement system administering an election in
11accordance with this amendatory Act of the 100th General
12Assembly to provide information concerning the impact of the
13election set forth in this Section.
14    (e) Notwithstanding any other provision of law, an employer
15under this Article is required to offer each future increase in
16income expressly and irrevocably on the condition of not
17constituting "salary" under Section 16-121 to any Tier 1
18employee who has made an election under paragraph (2) of
19subsection (a) of this Section. The offer shall also provide
20that the Tier 1 employee's acceptance of the offered future
21increase in income shall constitute his or her agreement to the
22condition set forth in this subsection.
23    For purposes of legislative intent, the condition set forth
24in this subsection shall be construed in a manner that ensures
25that the condition is not violated or circumvented through any
26contrivance of any kind.

 

 

10000SB0011sam003- 168 -LRB100 06001 RPS 21154 a

1    (f) A member's election under this Section is not a
2prohibited election under subdivision (j)(1) of Section 1-119
3of this Code.
4    (g) No provision of this Section shall be interpreted in a
5way that would cause the System to cease to be a qualified plan
6under Section 401(a) of the Internal Revenue Code of 1986.
7    (h) If an election created by this amendatory Act in any
8other Article of this Code or any change deriving from that
9election is determined to be unconstitutional or otherwise
10invalid by a final unappealable decision of an Illinois court
11or a court of competent jurisdiction, the invalidity of that
12provision shall not in any way affect the validity of this
13Section or the changes deriving from the election required
14under this Section.
 
15    (40 ILCS 5/16-133.1)  (from Ch. 108 1/2, par. 16-133.1)
16    (Text of Section WITHOUT the changes made by P.A. 98-599,
17which has been held unconstitutional)
18    Sec. 16-133.1. Automatic annual increase in annuity.
19    (a) Each member with creditable service and retiring on or
20after August 26, 1969 is entitled to the automatic annual
21increases in annuity provided under this Section while
22receiving a retirement annuity or disability retirement
23annuity from the system.
24    Except as otherwise provided in subsection (a-1), an An
25annuitant shall first be entitled to an initial increase under

 

 

10000SB0011sam003- 169 -LRB100 06001 RPS 21154 a

1this Section on the January 1 next following the first
2anniversary of retirement, or January 1 of the year next
3following attainment of age 61, whichever is later. At such
4time, the system shall pay an initial increase determined as
5follows:
6        (1) 1.5% of the originally granted retirement annuity
7    or disability retirement annuity multiplied by the number
8    of years elapsed, if any, from the date of retirement until
9    January 1, 1972, plus
10        (2) 2% of the originally granted annuity multiplied by
11    the number of years elapsed, if any, from the date of
12    retirement or January 1, 1972, whichever is later, until
13    January 1, 1978, plus
14        (3) 3% of the originally granted annuity multiplied by
15    the number of years elapsed from the date of retirement or
16    January 1, 1978, whichever is later, until the effective
17    date of the initial increase.
18However, the initial annual increase calculated under this
19Section for the recipient of a disability retirement annuity
20granted under Section 16-149.2 shall be reduced by an amount
21equal to the total of all increases in that annuity received
22under Section 16-149.5 (but not exceeding 100% of the amount of
23the initial increase otherwise provided under this Section).
24    Except as otherwise provided in subsection (a-1),
25following Following the initial increase, automatic annual
26increases in annuity shall be payable on each January 1

 

 

10000SB0011sam003- 170 -LRB100 06001 RPS 21154 a

1thereafter during the lifetime of the annuitant, determined as
2a percentage of the originally granted retirement annuity or
3disability retirement annuity for increases granted prior to
4January 1, 1990, and calculated as a percentage of the total
5amount of annuity, including previous increases under this
6Section, for increases granted on or after January 1, 1990, as
7follows: 1.5% for periods prior to January 1, 1972, 2% for
8periods after December 31, 1971 and prior to January 1, 1978,
9and 3% for periods after December 31, 1977.
10    (a-1) Notwithstanding any other provision of this Article,
11for a Tier 1 employee who made the election under paragraph (1)
12of subsection (a) of Section 16-122.9:
13        (1) The initial increase in retirement annuity under
14    this Section shall occur on the January 1 occurring either
15    on or after the attainment of age 67 or the fifth
16    anniversary of the annuity start date, whichever is
17    earlier.
18        (2) The amount of each automatic annual increase in
19    retirement annuity and survivor benefit occurring on or
20    after the effective date of that election shall be
21    calculated as a percentage of the originally granted
22    retirement annuity or survivor benefit, equal to 3% or
23    one-half the annual unadjusted percentage increase (but
24    not less than zero) in the consumer price index-u for the
25    12 months ending with the September preceding each November
26    1, whichever is less. If the annual unadjusted percentage

 

 

10000SB0011sam003- 171 -LRB100 06001 RPS 21154 a

1    change in the consumer price index-u for the 12 months
2    ending with the September preceding each November 1 is zero
3    or there is a decrease, then the annuity shall not be
4    increased.
5    For the purposes of this Section, "consumer price index-u"
6means the index published by the Bureau of Labor Statistics of
7the United States Department of Labor that measures the average
8change in prices of goods and services purchased by all urban
9consumers, United States city average, all items, 1982-84 =
10100. The new amount resulting from each annual adjustment shall
11be determined by the Public Pension Division of the Department
12of Insurance and made available to the board of the retirement
13system by November 1 of each year.
14    (b) The automatic annual increases in annuity provided
15under this Section shall not be applicable unless a member has
16made contributions toward such increases for a period
17equivalent to one full year of creditable service. If a member
18contributes for service performed after August 26, 1969 but the
19member becomes an annuitant before such contributions amount to
20one full year's contributions based on the salary at the date
21of retirement, he or she may pay the necessary balance of the
22contributions to the system and be eligible for the automatic
23annual increases in annuity provided under this Section.
24    (c) Each member shall make contributions toward the cost of
25the automatic annual increases in annuity as provided under
26Section 16-152.

 

 

10000SB0011sam003- 172 -LRB100 06001 RPS 21154 a

1    (d) An annuitant receiving a retirement annuity or
2disability retirement annuity on July 1, 1969, who subsequently
3re-enters service as a teacher is eligible for the automatic
4annual increases in annuity provided under this Section if he
5or she renders at least one year of creditable service
6following the latest re-entry.
7    (e) In addition to the automatic annual increases in
8annuity provided under this Section, an annuitant who meets the
9service requirements of this Section and whose retirement
10annuity or disability retirement annuity began on or before
11January 1, 1971 shall receive, on January 1, 1981, an increase
12in the annuity then being paid of one dollar per month for each
13year of creditable service. On January 1, 1982, an annuitant
14whose retirement annuity or disability retirement annuity
15began on or before January 1, 1977 shall receive an increase in
16the annuity then being paid of one dollar per month for each
17year of creditable service.
18    On January 1, 1987, any annuitant whose retirement annuity
19began on or before January 1, 1977, shall receive an increase
20in the monthly retirement annuity equal to 8 per year of
21creditable service times the number of years that have elapsed
22since the annuity began.
23(Source: P.A. 91-927, eff. 12-14-00.)
 
24    (40 ILCS 5/16-136.1)  (from Ch. 108 1/2, par. 16-136.1)
25    (Text of Section WITHOUT the changes made by P.A. 98-599,

 

 

10000SB0011sam003- 173 -LRB100 06001 RPS 21154 a

1which has been held unconstitutional)
2    Sec. 16-136.1. Annual increase for certain annuitants.
3    (a) Any annuitant receiving a retirement annuity on June
430, 1969 and any member retiring after June 30, 1969 shall be
5eligible for the annual increases provided under this Section
6provided the annuitant is ineligible for the automatic annual
7increase in annuity provided under Section 16-133.1, and
8provided further that (1) retirement occurred at age 55 or over
9and was based on 5 or more years of creditable service or (2)
10if retirement occurred prior to age 55, the retirement annuity
11was based on 20 or more years of creditable service.
12    (b) Except as otherwise provided in subsection (b-1), an An
13annuitant entitled to increases under this Section shall be
14entitled to the initial increase as of the later of: (1)
15January 1 following attainment of age 65, (2) January 1
16following the first anniversary of retirement, or (3) the first
17day of the month following receipt of the required qualifying
18contribution from the annuitant. The initial monthly increase
19shall be computed on the basis of the period elapsed between
20the later of the date of last retirement or attainment of age
2150 and the date of qualification for the initial increase, at
22the rate of 1 1/2% of the original monthly retirement annuity
23per year for periods prior to September 1, 1971, and at the
24rate of 2% per year for periods between September 1, 1971 and
25September 1, 1978, and at the rate of 3% per year for periods
26thereafter.

 

 

10000SB0011sam003- 174 -LRB100 06001 RPS 21154 a

1    Except as otherwise provided in subsection (b-1), if
2applicable, an An annuitant who has received an initial
3increase under this Section, shall be entitled, on each January
41 following the granting of the initial increase, to an
5increase of 3% of the original monthly retirement annuity for
6increases granted prior to January 1, 1990, and equal to 3% of
7the total annuity, including previous increases under this
8Section, for increases granted on or after January 1, 1990. The
9original monthly retirement annuity for computations under
10this subsection (b) shall be considered to be $83.34 for any
11annuitant entitled to benefits under Section 16-134. The
12minimum original disability retirement annuity for
13computations under this subsection (b) shall be considered to
14be $33.34 per month for any annuitant retired on account of
15disability.
16    (b-1) Notwithstanding any other provision of this Article,
17for a Tier 1 employee who made the election under paragraph (1)
18of subsection (a) of Section 16-122.9:
19        (1) The initial increase in retirement annuity under
20    this Section shall occur on the January 1 occurring either
21    on or after the attainment of age 67 or the fifth
22    anniversary of the annuity start date, whichever is
23    earlier.
24        (2) The amount of each automatic annual increase in
25    retirement annuity or survivor benefit occurring on or
26    after the effective date of that election shall be

 

 

10000SB0011sam003- 175 -LRB100 06001 RPS 21154 a

1    calculated as a percentage of the originally granted
2    retirement annuity or survivor benefit, equal to 3% or
3    one-half the annual unadjusted percentage increase (but
4    not less than zero) in the consumer price index-u for the
5    12 months ending with the September preceding each November
6    1, whichever is less. If the annual unadjusted percentage
7    change in the consumer price index-u for the 12 months
8    ending with the September preceding each November 1 is zero
9    or there is a decrease, then the annuity shall not be
10    increased.
11    For the purposes of this Section, "consumer price index-u"
12means the index published by the Bureau of Labor Statistics of
13the United States Department of Labor that measures the average
14change in prices of goods and services purchased by all urban
15consumers, United States city average, all items, 1982-84 =
16100. The new amount resulting from each annual adjustment shall
17be determined by the Public Pension Division of the Department
18of Insurance and made available to the board of the retirement
19system by November 1 of each year.
20    (c) An annuitant who otherwise qualifies for annual
21increases under this Section must make a one-time payment of 1%
22of the monthly final average salary for each full year of the
23creditable service forming the basis of the retirement annuity
24or, if the retirement annuity was not computed using final
25average salary, 1% of the original monthly retirement annuity
26for each full year of service forming the basis of the

 

 

10000SB0011sam003- 176 -LRB100 06001 RPS 21154 a

1retirement annuity.
2    (d) In addition to other increases which may be provided by
3this Section, regardless of creditable service, annuitants not
4meeting the service requirements of Section 16-133.1 and whose
5retirement annuity began on or before January 1, 1971 shall
6receive, on January 1, 1981, an increase in the retirement
7annuity then being paid of one dollar per month for each year
8of creditable service forming the basis of the retirement
9allowance. On January 1, 1982, annuitants whose retirement
10annuity began on or before January 1, 1977, shall receive an
11increase in the retirement annuity then being paid of one
12dollar per month for each year of creditable service.
13    On January 1, 1987, any annuitant whose retirement annuity
14began on or before January 1, 1977, shall receive an increase
15in the monthly retirement annuity equal to 8 per year of
16creditable service times the number of years that have elapsed
17since the annuity began.
18(Source: P.A. 86-273.)
 
19    (40 ILCS 5/16-152)  (from Ch. 108 1/2, par. 16-152)
20    (Text of Section WITHOUT the changes made by P.A. 98-599,
21which has been held unconstitutional)
22    Sec. 16-152. Contributions by members.
23    (a) Except as otherwise provided in subsection (a-5), each
24Each member shall make contributions for membership service to
25this System as follows:

 

 

10000SB0011sam003- 177 -LRB100 06001 RPS 21154 a

1        (1) Effective July 1, 1998, contributions of 7.50% of
2    salary towards the cost of the retirement annuity. Such
3    contributions shall be deemed "normal contributions".
4        (2) Effective July 1, 1969, contributions of 1/2 of 1%
5    of salary toward the cost of the automatic annual increase
6    in retirement annuity provided under Section 16-133.1.
7        (3) Effective July 24, 1959, contributions of 1% of
8    salary towards the cost of survivor benefits. Such
9    contributions shall not be credited to the individual
10    account of the member and shall not be subject to refund
11    except as provided under Section 16-143.2.
12        (4) Effective July 1, 2005, contributions of 0.40% of
13    salary toward the cost of the early retirement without
14    discount option provided under Section 16-133.2. This
15    contribution shall cease upon termination of the early
16    retirement without discount option as provided in Section
17    16-133.2.
18    (a-5) Beginning July 1, 2018 or the effective date of the
19Tier 1 employee's election under paragraph (1) of subsection
20(a) of Section 16-122.9, whichever is later, in lieu of the
21contributions otherwise required under subsection (a), each
22Tier 1 employee who made the election under paragraph (1) of
23subsection (a) of Section 16-122.9 shall make contributions as
24follows:
25        (1) Contributions of 7.50% of salary towards the cost
26    of the retirement annuity. Such contributions shall be

 

 

10000SB0011sam003- 178 -LRB100 06001 RPS 21154 a

1    deemed "normal contributions".
2        (2) Contributions of 0.60% towards the cost of survivor
3    benefits. Such contributions shall not be credited to the
4    individual account of the member and shall not be subject
5    to refund except as provided in Section 16-143.2.
6        (3) Contributions of 0.40% of salary toward the cost of
7    the early retirement without discount option provided
8    under Section 16-133.2. This contribution shall cease upon
9    termination of the early retirement without discount
10    option as provided in Section 16-133.2.
11    (b) The minimum required contribution for any year of
12full-time teaching service shall be $192.
13    (c) Contributions shall not be required of any annuitant
14receiving a retirement annuity who is given employment as
15permitted under Section 16-118 or 16-150.1.
16    (d) A person who (i) was a member before July 1, 1998, (ii)
17retires with more than 34 years of creditable service, and
18(iii) does not elect to qualify for the augmented rate under
19Section 16-129.1 shall be entitled, at the time of retirement,
20to receive a partial refund of contributions made under this
21Section for service occurring after the later of June 30, 1998
22or attainment of 34 years of creditable service, in an amount
23equal to 1.00% of the salary upon which those contributions
24were based.
25    (e) A member's contributions toward the cost of early
26retirement without discount made under item (a)(4) of this

 

 

10000SB0011sam003- 179 -LRB100 06001 RPS 21154 a

1Section shall not be refunded if the member has elected early
2retirement without discount under Section 16-133.2 and has
3begun to receive a retirement annuity under this Article
4calculated in accordance with that election. Otherwise, a
5member's contributions toward the cost of early retirement
6without discount made under item (a)(4) of this Section shall
7be refunded according to whichever one of the following
8circumstances occurs first:
9        (1) The contributions shall be refunded to the member,
10    without interest, within 120 days after the member's
11    retirement annuity commences, if the member does not elect
12    early retirement without discount under Section 16-133.2.
13        (2) The contributions shall be included, without
14    interest, in any refund claimed by the member under Section
15    16-151.
16        (3) The contributions shall be refunded to the member's
17    designated beneficiary (or if there is no beneficiary, to
18    the member's estate), without interest, if the member dies
19    without having begun to receive a retirement annuity under
20    this Article.
21        (4) The contributions shall be refunded to the member,
22    without interest, if the early retirement without discount
23    option provided under subsection (d) of Section 16-133.2 is
24    terminated. In that event, the System shall provide to the
25    member, within 120 days after the option is terminated, an
26    application for a refund of those contributions.

 

 

10000SB0011sam003- 180 -LRB100 06001 RPS 21154 a

1(Source: P.A. 98-42, eff. 6-28-13; 98-92, eff. 7-16-13; 99-642,
2eff. 7-28-16.)
 
3    (40 ILCS 5/16-158)   (from Ch. 108 1/2, par. 16-158)
4    (Text of Section WITHOUT the changes made by P.A. 98-599,
5which has been held unconstitutional)
6    Sec. 16-158. Contributions by State and other employing
7units.
8    (a) The State shall make contributions to the System by
9means of appropriations from the Common School Fund and other
10State funds of amounts which, together with other employer
11contributions, employee contributions, investment income, and
12other income, will be sufficient to meet the cost of
13maintaining and administering the System on a 90% funded basis
14in accordance with actuarial recommendations.
15    The Board shall determine the amount of State contributions
16required for each fiscal year on the basis of the actuarial
17tables and other assumptions adopted by the Board and the
18recommendations of the actuary, using the formula in subsection
19(b-3).
20    (a-1) Annually, on or before November 15 until November 15,
212011, the Board shall certify to the Governor the amount of the
22required State contribution for the coming fiscal year. The
23certification under this subsection (a-1) shall include a copy
24of the actuarial recommendations upon which it is based and
25shall specifically identify the System's projected State

 

 

10000SB0011sam003- 181 -LRB100 06001 RPS 21154 a

1normal cost for that fiscal year.
2    On or before May 1, 2004, the Board shall recalculate and
3recertify to the Governor the amount of the required State
4contribution to the System for State fiscal year 2005, taking
5into account the amounts appropriated to and received by the
6System under subsection (d) of Section 7.2 of the General
7Obligation Bond Act.
8    On or before July 1, 2005, the Board shall recalculate and
9recertify to the Governor the amount of the required State
10contribution to the System for State fiscal year 2006, taking
11into account the changes in required State contributions made
12by this amendatory Act of the 94th General Assembly.
13    On or before April 1, 2011, the Board shall recalculate and
14recertify to the Governor the amount of the required State
15contribution to the System for State fiscal year 2011, applying
16the changes made by Public Act 96-889 to the System's assets
17and liabilities as of June 30, 2009 as though Public Act 96-889
18was approved on that date.
19    (a-5) On or before November 1 of each year, beginning
20November 1, 2012, the Board shall submit to the State Actuary,
21the Governor, and the General Assembly a proposed certification
22of the amount of the required State contribution to the System
23for the next fiscal year, along with all of the actuarial
24assumptions, calculations, and data upon which that proposed
25certification is based. On or before January 1 of each year,
26beginning January 1, 2013, the State Actuary shall issue a

 

 

10000SB0011sam003- 182 -LRB100 06001 RPS 21154 a

1preliminary report concerning the proposed certification and
2identifying, if necessary, recommended changes in actuarial
3assumptions that the Board must consider before finalizing its
4certification of the required State contributions. On or before
5January 15, 2013 and each January 15 thereafter, the Board
6shall certify to the Governor and the General Assembly the
7amount of the required State contribution for the next fiscal
8year. The Board's certification must note any deviations from
9the State Actuary's recommended changes, the reason or reasons
10for not following the State Actuary's recommended changes, and
11the fiscal impact of not following the State Actuary's
12recommended changes on the required State contribution.
13    (a-10) As soon as practical after the effective date of
14this amendatory Act of the 100th General Assembly, the State
15Actuary and the Board shall recalculate and recertify to the
16Governor and the General Assembly the amount of the State
17contribution to the System for State fiscal year 2018, taking
18into account the changes in required State contributions made
19by this amendatory Act of the 100th General Assembly.
20    (a-15) On or before May 1, 2018, the Board shall
21recalculate and recertify to the Governor and the General
22Assembly the amount of the required State contribution to the
23System for State fiscal year 2019, taking into account the
24effect on the System's liabilities of the elections made under
25Section 16-122.9.
26    On or before October 1, 2018, the Board shall recalculate

 

 

10000SB0011sam003- 183 -LRB100 06001 RPS 21154 a

1and recertify to the Governor and the General Assembly the
2amount of the required State contribution to the System for
3State fiscal year 2019, taking into account the reduction
4specified under item (3) of subsection (b-3) of this Section.
5    (b) Through State fiscal year 1995, the State contributions
6shall be paid to the System in accordance with Section 18-7 of
7the School Code.
8    (b-1) Beginning in State fiscal year 1996, on the 15th day
9of each month, or as soon thereafter as may be practicable, the
10Board shall submit vouchers for payment of State contributions
11to the System, in a total monthly amount of one-twelfth of the
12required annual State contribution certified under subsection
13(a-1). From the effective date of this amendatory Act of the
1493rd General Assembly through June 30, 2004, the Board shall
15not submit vouchers for the remainder of fiscal year 2004 in
16excess of the fiscal year 2004 certified contribution amount
17determined under this Section after taking into consideration
18the transfer to the System under subsection (a) of Section
196z-61 of the State Finance Act. These vouchers shall be paid by
20the State Comptroller and Treasurer by warrants drawn on the
21funds appropriated to the System for that fiscal year.
22    If in any month the amount remaining unexpended from all
23other appropriations to the System for the applicable fiscal
24year (including the appropriations to the System under Section
258.12 of the State Finance Act and Section 1 of the State
26Pension Funds Continuing Appropriation Act) is less than the

 

 

10000SB0011sam003- 184 -LRB100 06001 RPS 21154 a

1amount lawfully vouchered under this subsection, the
2difference shall be paid from the Common School Fund under the
3continuing appropriation authority provided in Section 1.1 of
4the State Pension Funds Continuing Appropriation Act.
5    (b-2) Allocations from the Common School Fund apportioned
6to school districts not coming under this System shall not be
7diminished or affected by the provisions of this Article.
8    (b-3) For State fiscal years 2018 through 2045 (except as
9otherwise provided for fiscal year 2019), the minimum
10contribution to the System to be made by the State for each
11fiscal year shall be an amount determined by the System to be
12sufficient to bring the total assets of the System up to 90% of
13the total actuarial liabilities of the System by the end of
14State fiscal year 2045. In making these determinations, the
15required State contribution shall be calculated each year as a
16level percentage of total payroll, including payroll that is
17not deemed pensionable, but excluding payroll attributable to
18participants in the defined contribution plan under Section
1916-205.1, over the years remaining to and including fiscal year
202045 and shall be determined under the projected unit credit
21actuarial cost method.
22    For State fiscal year 2019:
23        (1) The initial calculation and certification shall be
24    based on the amount determined above.
25        (2) For purposes of the recertification due on or
26    before May 1, 2018, the recalculation of the required State

 

 

10000SB0011sam003- 185 -LRB100 06001 RPS 21154 a

1    contribution for fiscal year 2019 shall take into account
2    the effect on the System's liabilities of the elections
3    made under Section 16-122.9.
4        (3) For purposes of the recertification due on or
5    before October 1, 2018, the total required State
6    contribution for fiscal year 2019 shall be reduced by the
7    amount of the consideration payments made to Tier 1
8    employees who made the election under paragraph (1) of
9    subsection (a) of Section 16-122.9.
10    Beginning in State fiscal year 2018, any increase or
11decrease in State contribution over the prior fiscal year due
12exclusively to changes in actuarial or investment assumptions
13adopted by the Board shall be included in the State
14contribution to the System, as a percentage of the applicable
15employee payroll, and shall be increased in equal annual
16increments so that by the State fiscal year occurring 5 years
17after the adoption of the actuarial or investment assumptions,
18the State is contributing at the rate otherwise required under
19this Section.
20    For State fiscal years 2012 through 2017 2045, the minimum
21contribution to the System to be made by the State for each
22fiscal year shall be an amount determined by the System to be
23sufficient to bring the total assets of the System up to 90% of
24the total actuarial liabilities of the System by the end of
25State fiscal year 2045. In making these determinations, the
26required State contribution shall be calculated each year as a

 

 

10000SB0011sam003- 186 -LRB100 06001 RPS 21154 a

1level percentage of payroll over the years remaining to and
2including fiscal year 2045 and shall be determined under the
3projected unit credit actuarial cost method.
4    For State fiscal years 1996 through 2005, the State
5contribution to the System, as a percentage of the applicable
6employee payroll, shall be increased in equal annual increments
7so that by State fiscal year 2011, the State is contributing at
8the rate required under this Section; except that in the
9following specified State fiscal years, the State contribution
10to the System shall not be less than the following indicated
11percentages of the applicable employee payroll, even if the
12indicated percentage will produce a State contribution in
13excess of the amount otherwise required under this subsection
14and subsection (a), and notwithstanding any contrary
15certification made under subsection (a-1) before the effective
16date of this amendatory Act of 1998: 10.02% in FY 1999; 10.77%
17in FY 2000; 11.47% in FY 2001; 12.16% in FY 2002; 12.86% in FY
182003; and 13.56% in FY 2004.
19    Notwithstanding any other provision of this Article, the
20total required State contribution for State fiscal year 2006 is
21$534,627,700.
22    Notwithstanding any other provision of this Article, the
23total required State contribution for State fiscal year 2007 is
24$738,014,500.
25    For each of State fiscal years 2008 through 2009, the State
26contribution to the System, as a percentage of the applicable

 

 

10000SB0011sam003- 187 -LRB100 06001 RPS 21154 a

1employee payroll, shall be increased in equal annual increments
2from the required State contribution for State fiscal year
32007, so that by State fiscal year 2011, the State is
4contributing at the rate otherwise required under this Section.
5    Notwithstanding any other provision of this Article, the
6total required State contribution for State fiscal year 2010 is
7$2,089,268,000 and shall be made from the proceeds of bonds
8sold in fiscal year 2010 pursuant to Section 7.2 of the General
9Obligation Bond Act, less (i) the pro rata share of bond sale
10expenses determined by the System's share of total bond
11proceeds, (ii) any amounts received from the Common School Fund
12in fiscal year 2010, and (iii) any reduction in bond proceeds
13due to the issuance of discounted bonds, if applicable.
14    Notwithstanding any other provision of this Article, the
15total required State contribution for State fiscal year 2011 is
16the amount recertified by the System on or before April 1, 2011
17pursuant to subsection (a-1) of this Section and shall be made
18from the proceeds of bonds sold in fiscal year 2011 pursuant to
19Section 7.2 of the General Obligation Bond Act, less (i) the
20pro rata share of bond sale expenses determined by the System's
21share of total bond proceeds, (ii) any amounts received from
22the Common School Fund in fiscal year 2011, and (iii) any
23reduction in bond proceeds due to the issuance of discounted
24bonds, if applicable. This amount shall include, in addition to
25the amount certified by the System, an amount necessary to meet
26employer contributions required by the State as an employer

 

 

10000SB0011sam003- 188 -LRB100 06001 RPS 21154 a

1under paragraph (e) of this Section, which may also be used by
2the System for contributions required by paragraph (a) of
3Section 16-127.
4    Beginning in State fiscal year 2046, the minimum State
5contribution for each fiscal year shall be the amount needed to
6maintain the total assets of the System at 90% of the total
7actuarial liabilities of the System.
8    Amounts received by the System pursuant to Section 25 of
9the Budget Stabilization Act or Section 8.12 of the State
10Finance Act in any fiscal year do not reduce and do not
11constitute payment of any portion of the minimum State
12contribution required under this Article in that fiscal year.
13Such amounts shall not reduce, and shall not be included in the
14calculation of, the required State contributions under this
15Article in any future year until the System has reached a
16funding ratio of at least 90%. A reference in this Article to
17the "required State contribution" or any substantially similar
18term does not include or apply to any amounts payable to the
19System under Section 25 of the Budget Stabilization Act.
20    Notwithstanding any other provision of this Section, the
21required State contribution for State fiscal year 2005 and for
22fiscal year 2008 and each fiscal year thereafter, as calculated
23under this Section and certified under subsection (a-1), shall
24not exceed an amount equal to (i) the amount of the required
25State contribution that would have been calculated under this
26Section for that fiscal year if the System had not received any

 

 

10000SB0011sam003- 189 -LRB100 06001 RPS 21154 a

1payments under subsection (d) of Section 7.2 of the General
2Obligation Bond Act, minus (ii) the portion of the State's
3total debt service payments for that fiscal year on the bonds
4issued in fiscal year 2003 for the purposes of that Section
57.2, as determined and certified by the Comptroller, that is
6the same as the System's portion of the total moneys
7distributed under subsection (d) of Section 7.2 of the General
8Obligation Bond Act. In determining this maximum for State
9fiscal years 2008 through 2010, however, the amount referred to
10in item (i) shall be increased, as a percentage of the
11applicable employee payroll, in equal increments calculated
12from the sum of the required State contribution for State
13fiscal year 2007 plus the applicable portion of the State's
14total debt service payments for fiscal year 2007 on the bonds
15issued in fiscal year 2003 for the purposes of Section 7.2 of
16the General Obligation Bond Act, so that, by State fiscal year
172011, the State is contributing at the rate otherwise required
18under this Section.
19    (c) Payment of the required State contributions and of all
20pensions, retirement annuities, death benefits, refunds, and
21other benefits granted under or assumed by this System, and all
22expenses in connection with the administration and operation
23thereof, are obligations of the State.
24    If members are paid from special trust or federal funds
25which are administered by the employing unit, whether school
26district or other unit, the employing unit shall pay to the

 

 

10000SB0011sam003- 190 -LRB100 06001 RPS 21154 a

1System from such funds the full accruing retirement costs based
2upon that service, which, beginning July 1, 2014, shall be at a
3rate, expressed as a percentage of salary, equal to the total
4minimum contribution to the System to be made by the State for
5that fiscal year, including both normal cost and unfunded
6liability components, expressed as a percentage of payroll, as
7determined by the System under subsection (b-3) of this
8Section. Employer contributions, based on salary paid to
9members from federal funds, may be forwarded by the
10distributing agency of the State of Illinois to the System
11prior to allocation, in an amount determined in accordance with
12guidelines established by such agency and the System. Any
13contribution for fiscal year 2015 collected as a result of the
14change made by this amendatory Act of the 98th General Assembly
15shall be considered a State contribution under subsection (b-3)
16of this Section.
17    (d) Effective July 1, 1986, any employer of a teacher as
18defined in paragraph (8) of Section 16-106 shall pay the
19employer's normal cost of benefits based upon the teacher's
20service, in addition to employee contributions, as determined
21by the System. Such employer contributions shall be forwarded
22monthly in accordance with guidelines established by the
23System.
24    However, with respect to benefits granted under Section
2516-133.4 or 16-133.5 to a teacher as defined in paragraph (8)
26of Section 16-106, the employer's contribution shall be 12%

 

 

10000SB0011sam003- 191 -LRB100 06001 RPS 21154 a

1(rather than 20%) of the member's highest annual salary rate
2for each year of creditable service granted, and the employer
3shall also pay the required employee contribution on behalf of
4the teacher. For the purposes of Sections 16-133.4 and
516-133.5, a teacher as defined in paragraph (8) of Section
616-106 who is serving in that capacity while on leave of
7absence from another employer under this Article shall not be
8considered an employee of the employer from which the teacher
9is on leave.
10    (e) Beginning July 1, 1998, every employer of a teacher
11shall pay to the System an employer contribution computed as
12follows:
13        (1) Beginning July 1, 1998 through June 30, 1999, the
14    employer contribution shall be equal to 0.3% of each
15    teacher's salary.
16        (2) Beginning July 1, 1999 and thereafter, the employer
17    contribution shall be equal to 0.58% of each teacher's
18    salary.
19The school district or other employing unit may pay these
20employer contributions out of any source of funding available
21for that purpose and shall forward the contributions to the
22System on the schedule established for the payment of member
23contributions.
24    These employer contributions are intended to offset a
25portion of the cost to the System of the increases in
26retirement benefits resulting from this amendatory Act of 1998.

 

 

10000SB0011sam003- 192 -LRB100 06001 RPS 21154 a

1    Each employer of teachers is entitled to a credit against
2the contributions required under this subsection (e) with
3respect to salaries paid to teachers for the period January 1,
42002 through June 30, 2003, equal to the amount paid by that
5employer under subsection (a-5) of Section 6.6 of the State
6Employees Group Insurance Act of 1971 with respect to salaries
7paid to teachers for that period.
8    The additional 1% employee contribution required under
9Section 16-152 by this amendatory Act of 1998 is the
10responsibility of the teacher and not the teacher's employer,
11unless the employer agrees, through collective bargaining or
12otherwise, to make the contribution on behalf of the teacher.
13    If an employer is required by a contract in effect on May
141, 1998 between the employer and an employee organization to
15pay, on behalf of all its full-time employees covered by this
16Article, all mandatory employee contributions required under
17this Article, then the employer shall be excused from paying
18the employer contribution required under this subsection (e)
19for the balance of the term of that contract. The employer and
20the employee organization shall jointly certify to the System
21the existence of the contractual requirement, in such form as
22the System may prescribe. This exclusion shall cease upon the
23termination, extension, or renewal of the contract at any time
24after May 1, 1998.
25    (f) For school years beginning on or after June 1, 2005 and
26before July 1, 2018, if If the amount of a teacher's salary for

 

 

10000SB0011sam003- 193 -LRB100 06001 RPS 21154 a

1any school year used to determine final average salary exceeds
2the member's annual full-time salary rate with the same
3employer for the previous school year by more than 6%, the
4teacher's employer shall pay to the System, in addition to all
5other payments required under this Section and in accordance
6with guidelines established by the System, the present value of
7the increase in benefits resulting from the portion of the
8increase in salary that is in excess of 6%. This present value
9shall be computed by the System on the basis of the actuarial
10assumptions and tables used in the most recent actuarial
11valuation of the System that is available at the time of the
12computation. If a teacher's salary for the 2005-2006 school
13year is used to determine final average salary under this
14subsection (f), then the changes made to this subsection (f) by
15Public Act 94-1057 shall apply in calculating whether the
16increase in his or her salary is in excess of 6%. For the
17purposes of this Section, change in employment under Section
1810-21.12 of the School Code on or after June 1, 2005 shall
19constitute a change in employer. The System may require the
20employer to provide any pertinent information or
21documentation. The changes made to this subsection (f) by this
22amendatory Act of the 94th General Assembly apply without
23regard to whether the teacher was in service on or after its
24effective date.
25    Whenever it determines that a payment is or may be required
26under this subsection, the System shall calculate the amount of

 

 

10000SB0011sam003- 194 -LRB100 06001 RPS 21154 a

1the payment and bill the employer for that amount. The bill
2shall specify the calculations used to determine the amount
3due. If the employer disputes the amount of the bill, it may,
4within 30 days after receipt of the bill, apply to the System
5in writing for a recalculation. The application must specify in
6detail the grounds of the dispute and, if the employer asserts
7that the calculation is subject to subsection (g) or (h) of
8this Section, must include an affidavit setting forth and
9attesting to all facts within the employer's knowledge that are
10pertinent to the applicability of that subsection. Upon
11receiving a timely application for recalculation, the System
12shall review the application and, if appropriate, recalculate
13the amount due.
14    The employer contributions required under this subsection
15(f) may be paid in the form of a lump sum within 90 days after
16receipt of the bill. If the employer contributions are not paid
17within 90 days after receipt of the bill, then interest will be
18charged at a rate equal to the System's annual actuarially
19assumed rate of return on investment compounded annually from
20the 91st day after receipt of the bill. Payments must be
21concluded within 3 years after the employer's receipt of the
22bill.
23    (f-1) For school years beginning on or after July 1, 2018,
24if the amount of a teacher's salary for any school year used to
25determine final average salary exceeds the member's annual
26full-time salary rate with the same employer for the previous

 

 

10000SB0011sam003- 195 -LRB100 06001 RPS 21154 a

1school year by more than the unadjusted percentage increase in
2the consumer price index-u for the calendar year immediately
3preceding the beginning of the school year, published by the
4Public Pension Division of the Department of Insurance by
5November 1 of each year, then the teacher's employer shall pay
6to the System, in addition to all other payments required under
7this Section and in accordance with guidelines established by
8the System, the present value of the increase in benefits
9resulting from the portion of the increase in salary that is in
10excess of the unadjusted percentage increase in the consumer
11price index-u for the applicable calendar year. This present
12value shall be computed by the System on the basis of the
13actuarial assumptions and tables used in the most recent
14actuarial valuation of the System that is available at the time
15of the computation. The System may require the employer to
16provide any pertinent information or documentation.
17    Whenever it determines that a payment is or may be required
18under this subsection (f-1), the System shall calculate the
19amount of the payment and bill the employer for that amount.
20The bill shall specify the calculations used to determine the
21amount due. If the employer disputes the amount of the bill, it
22may, within 30 days after receipt of the bill, apply to the
23System in writing for a recalculation. The application must
24specify in detail the grounds of the dispute and, if the
25employer asserts that the calculation is subject to subsection
26(h-1) of this Section, must include an affidavit setting forth

 

 

10000SB0011sam003- 196 -LRB100 06001 RPS 21154 a

1and attesting to all facts within the employer's knowledge that
2are pertinent to the applicability of subsection (h-1). Upon
3receiving a timely application for recalculation, the System
4shall review the application and, if appropriate, recalculate
5the amount due.
6    The employer contributions required under this subsection
7(f-1) may be paid in the form of a lump sum within 90 days after
8receipt of the bill. If the employer contributions are not paid
9within 90 days after receipt of the bill, then interest shall
10be charged at a rate equal to the System's annual actuarially
11assumed rate of return on investment compounded annually from
12the 91st day after receipt of the bill. Payments must be
13concluded within 3 years after the employer's receipt of the
14bill.
15    For the purposes of this Section, "consumer price index-u"
16means the index published by the Bureau of Labor Statistics of
17the United States Department of Labor that measures the average
18change in prices of goods and services purchased by all urban
19consumers, United States city average, all items, 1982-84 =
20100. The new amount resulting from each annual adjustment shall
21be determined by the Public Pension Division of the Department
22of Insurance and made available to the boards of the retirement
23systems and pension funds by November 1 of each year.
24    (g) This subsection (g) applies only to payments made or
25salary increases given on or after June 1, 2005 but before July
261, 2011. The changes made by Public Act 94-1057 shall not

 

 

10000SB0011sam003- 197 -LRB100 06001 RPS 21154 a

1require the System to refund any payments received before July
231, 2006 (the effective date of Public Act 94-1057).
3    When assessing payment for any amount due under subsection
4(f), the System shall exclude salary increases paid to teachers
5under contracts or collective bargaining agreements entered
6into, amended, or renewed before June 1, 2005.
7    When assessing payment for any amount due under subsection
8(f), the System shall exclude salary increases paid to a
9teacher at a time when the teacher is 10 or more years from
10retirement eligibility under Section 16-132 or 16-133.2.
11    When assessing payment for any amount due under subsection
12(f), the System shall exclude salary increases resulting from
13overload work, including summer school, when the school
14district has certified to the System, and the System has
15approved the certification, that (i) the overload work is for
16the sole purpose of classroom instruction in excess of the
17standard number of classes for a full-time teacher in a school
18district during a school year and (ii) the salary increases are
19equal to or less than the rate of pay for classroom instruction
20computed on the teacher's current salary and work schedule.
21    When assessing payment for any amount due under subsection
22(f), the System shall exclude a salary increase resulting from
23a promotion (i) for which the employee is required to hold a
24certificate or supervisory endorsement issued by the State
25Teacher Certification Board that is a different certification
26or supervisory endorsement than is required for the teacher's

 

 

10000SB0011sam003- 198 -LRB100 06001 RPS 21154 a

1previous position and (ii) to a position that has existed and
2been filled by a member for no less than one complete academic
3year and the salary increase from the promotion is an increase
4that results in an amount no greater than the lesser of the
5average salary paid for other similar positions in the district
6requiring the same certification or the amount stipulated in
7the collective bargaining agreement for a similar position
8requiring the same certification.
9    When assessing payment for any amount due under subsection
10(f), the System shall exclude any payment to the teacher from
11the State of Illinois or the State Board of Education over
12which the employer does not have discretion, notwithstanding
13that the payment is included in the computation of final
14average salary.
15    (h) When assessing payment for any amount due under
16subsection (f), the System shall exclude any salary increase
17described in subsection (g) of this Section given on or after
18July 1, 2011 but before July 1, 2014 under a contract or
19collective bargaining agreement entered into, amended, or
20renewed on or after June 1, 2005 but before July 1, 2011.
21Notwithstanding any other provision of this Section, any
22payments made or salary increases given after June 30, 2014
23shall be used in assessing payment for any amount due under
24subsection (f) of this Section.
25    (h-1) When assessing payment for any amount due under
26subsection (f-1), the System shall exclude earnings increases

 

 

10000SB0011sam003- 199 -LRB100 06001 RPS 21154 a

1paid to participants under contracts or collective bargaining
2agreements entered into, amended, or renewed before the
3effective date of this amendatory Act of the 100th General
4Assembly.
5    (i) The System shall prepare a report and file copies of
6the report with the Governor and the General Assembly by
7January 1, 2007 that contains all of the following information:
8        (1) The number of recalculations required by the
9    changes made to this Section by Public Act 94-1057 for each
10    employer.
11        (2) The dollar amount by which each employer's
12    contribution to the System was changed due to
13    recalculations required by Public Act 94-1057.
14        (3) The total amount the System received from each
15    employer as a result of the changes made to this Section by
16    Public Act 94-4.
17        (4) The increase in the required State contribution
18    resulting from the changes made to this Section by Public
19    Act 94-1057.
20    (i-5) For school years beginning on or after July 1, 2018,
21if the amount of a participant's salary for any school year,
22determined on a full-time equivalent basis, exceeds $140,000,
23the participant's employer shall pay to the System, in addition
24to all other payments required under this Section and in
25accordance with guidelines established by the System, the
26amount of earnings that exceed $140,000 multiplied by the level

 

 

10000SB0011sam003- 200 -LRB100 06001 RPS 21154 a

1percentage of payroll used in that fiscal year as determined by
2the System to be sufficient to bring the total assets of the
3System up to 90% of the total actuarial liabilities of the
4System by the end of State fiscal year 2045. This amount shall
5be computed by the System on the basis of the actuarial
6assumptions and tables used in the most recent actuarial
7valuation of the System that is available at the time of the
8computation. The System may require the employer to provide any
9pertinent information or documentation.
10    Whenever it determines that a payment is or may be required
11under this subsection, the System shall calculate the amount of
12the payment and bill the employer for that amount. The bill
13shall specify the calculations used to determine the amount
14due. If the employer disputes the amount of the bill, it may,
15within 30 days after receipt of the bill, apply to the System
16in writing for a recalculation. The application must specify in
17detail the grounds of the dispute. Upon receiving a timely
18application for recalculation, the System shall review the
19application and, if appropriate, recalculate the amount due.
20    The employer contributions required under this subsection
21may be paid in the form of a lump sum within 90 days after
22receipt of the bill. If the employer contributions are not paid
23within 90 days after receipt of the bill, then interest will be
24charged at a rate equal to the System's annual actuarially
25assumed rate of return on investment compounded annually from
26the 91st day after receipt of the bill. Payments must be

 

 

10000SB0011sam003- 201 -LRB100 06001 RPS 21154 a

1concluded within 3 years after the employer's receipt of the
2bill.
3    (j) For purposes of determining the required State
4contribution to the System, the value of the System's assets
5shall be equal to the actuarial value of the System's assets,
6which shall be calculated as follows:
7    As of June 30, 2008, the actuarial value of the System's
8assets shall be equal to the market value of the assets as of
9that date. In determining the actuarial value of the System's
10assets for fiscal years after June 30, 2008, any actuarial
11gains or losses from investment return incurred in a fiscal
12year shall be recognized in equal annual amounts over the
135-year period following that fiscal year.
14    (k) For purposes of determining the required State
15contribution to the system for a particular year, the actuarial
16value of assets shall be assumed to earn a rate of return equal
17to the system's actuarially assumed rate of return.
18    (l) If Section 16-122.9 is determined to be
19unconstitutional or otherwise invalid by a final unappealable
20decision of an Illinois court or a court of competent
21jurisdiction, then the changes made to this Section by this
22amendatory Act of the 100th General Assembly shall not take
23effect and are repealed by operation of law.
24(Source: P.A. 96-43, eff. 7-15-09; 96-1497, eff. 1-14-11;
2596-1511, eff. 1-27-11; 96-1554, eff. 3-18-11; 97-694, eff.
266-18-12; 97-813, eff. 7-13-12; 98-674, eff. 6-30-14.)
 

 

 

10000SB0011sam003- 202 -LRB100 06001 RPS 21154 a

1    (40 ILCS 5/16-190.5 new)
2    Sec. 16-190.5. Accelerated pension benefit payment.
3    (a) As used in this Section:
4    "Eligible person" means a person who:
5        (1) has terminated service;
6        (2) has accrued sufficient service credit to be
7    eligible to receive a retirement annuity under this
8    Article;
9        (3) has not received any retirement annuity under this
10    Article; and
11        (4) does not have a QILDRO in effect against him or her
12    under this Article.
13    "Pension benefit" means the benefits under this Article, or
14Article 1 as it relates to those benefits, including any
15anticipated annual increases, that an eligible person is
16entitled to upon attainment of the applicable retirement age.
17"Pension benefit" also includes applicable survivor's or
18disability benefits.
19    (b) Before January 1, 2018, and annually thereafter, the
20System shall calculate, using actuarial tables and other
21assumptions adopted by the Board, the net present value of
22pension benefits for each eligible person and shall offer each
23eligible person the opportunity to irrevocably elect to receive
24an amount determined by the System to be equal to 70% of the
25net present value of his or her pension benefits in lieu of

 

 

10000SB0011sam003- 203 -LRB100 06001 RPS 21154 a

1receiving any pension benefit. The offer shall specify the
2dollar amount that the eligible person will receive if he or
3she so elects and shall expire when a subsequent offer is made
4to an eligible person or when the System determines that 10% of
5eligible persons in that year have made the election under this
6subsection, whichever occurs first. The System shall make a
7good faith effort to contact every eligible person to notify
8him or her of the election and of the amount of the accelerated
9pension benefit payment.
10    Until the System determines that 10% of eligible persons in
11that year have made the election under this subsection, an
12eligible person may irrevocably elect to receive an accelerated
13pension benefit payment in the amount that the System offers
14under this subsection in lieu of receiving any pension benefit.
15A person who elects to receive an accelerated pension benefit
16payment under this Section may not elect to proceed under the
17Retirement Systems Reciprocal Act with respect to service under
18this Article.
19    (c) A person's credits and creditable service under this
20Article shall be terminated upon the person's receipt of an
21accelerated pension benefit payment under this Section, and no
22other benefit shall be paid under this Article based on those
23terminated credits and creditable service, including any
24retirement, survivor, or other benefit; except that to the
25extent that participation, benefits, or premiums under the
26State Employees Group Insurance Act of 1971 are based on the

 

 

10000SB0011sam003- 204 -LRB100 06001 RPS 21154 a

1amount of service credit, the terminated service credit shall
2be used for that purpose.
3    (d) If a person who has received an accelerated pension
4benefit payment under this Section returns to active service
5under this Article, then:
6        (1) Any benefits under the System earned as a result of
7    that return to active service shall be based solely on the
8    person's credits and creditable service arising from the
9    return to active service.
10        (2) The accelerated pension benefit payment may not be
11    repaid to the System, and the terminated credits and
12    creditable service may not under any circumstances be
13    reinstated.
14    (e) As a condition of receiving an accelerated pension
15benefit payment, an eligible person must have another
16retirement plan or account qualified under the Internal Revenue
17Code of 1986, as amended, for the accelerated pension benefit
18payment to be rolled into. The accelerated pension benefit
19payment under this Section may be subject to withholding or
20payment of applicable taxes, but to the extent permitted by
21federal law, a person who receives an accelerated pension
22benefit payment under this Section must direct the System to
23pay all of that payment as a rollover into another retirement
24plan or account qualified under the Internal Revenue Code of
251986, as amended.
26    (f) Before January 1, 2019 and every January 1 thereafter,

 

 

10000SB0011sam003- 205 -LRB100 06001 RPS 21154 a

1the Board shall certify to the Illinois Finance Authority and
2the General Assembly the amount by which the total amount of
3accelerated pension benefit payments made under this Section
4exceed the amount appropriated to the System for the purpose of
5making those payments.
6    (g) The Board shall adopt any rules necessary to implement
7this Section.
8    (h) No provision of this Section shall be interpreted in a
9way that would cause the applicable System to cease to be a
10qualified plan under the Internal Revenue Code of 1986.
11    (i) Notwithstanding any other provision of this Section, in
12no case shall the total amount of accelerated pension benefit
13payments paid under this Section, Section 14-147.5, and Section
1415-185.5, and Section 16-190.5 cause the Illinois Finance
15Authority to issue more than the $250,000,000 of State Pension
16Obligation Acceleration Bonds authorized in subsection (c-5)
17of Section 801-40 of the Illinois Finance Authority Act.
 
18    (40 ILCS 5/16-203)
19    (Text of Section WITHOUT the changes made by P.A. 98-599,
20which has been held unconstitutional)
21    Sec. 16-203. Application and expiration of new benefit
22increases.
23    (a) As used in this Section, "new benefit increase" means
24an increase in the amount of any benefit provided under this
25Article, or an expansion of the conditions of eligibility for

 

 

10000SB0011sam003- 206 -LRB100 06001 RPS 21154 a

1any benefit under this Article, that results from an amendment
2to this Code that takes effect after June 1, 2005 (the
3effective date of Public Act 94-4). "New benefit increase",
4however, does not include any benefit increase resulting from
5the changes made to this Article by Public Act 95-910 or this
6amendatory Act of the 100th 95th General Assembly.
7    (b) Notwithstanding any other provision of this Code or any
8subsequent amendment to this Code, every new benefit increase
9is subject to this Section and shall be deemed to be granted
10only in conformance with and contingent upon compliance with
11the provisions of this Section.
12    (c) The Public Act enacting a new benefit increase must
13identify and provide for payment to the System of additional
14funding at least sufficient to fund the resulting annual
15increase in cost to the System as it accrues.
16    Every new benefit increase is contingent upon the General
17Assembly providing the additional funding required under this
18subsection. The Commission on Government Forecasting and
19Accountability shall analyze whether adequate additional
20funding has been provided for the new benefit increase and
21shall report its analysis to the Public Pension Division of the
22Department of Insurance Financial and Professional Regulation.
23A new benefit increase created by a Public Act that does not
24include the additional funding required under this subsection
25is null and void. If the Public Pension Division determines
26that the additional funding provided for a new benefit increase

 

 

10000SB0011sam003- 207 -LRB100 06001 RPS 21154 a

1under this subsection is or has become inadequate, it may so
2certify to the Governor and the State Comptroller and, in the
3absence of corrective action by the General Assembly, the new
4benefit increase shall expire at the end of the fiscal year in
5which the certification is made.
6    (d) Every new benefit increase shall expire 5 years after
7its effective date or on such earlier date as may be specified
8in the language enacting the new benefit increase or provided
9under subsection (c). This does not prevent the General
10Assembly from extending or re-creating a new benefit increase
11by law.
12    (e) Except as otherwise provided in the language creating
13the new benefit increase, a new benefit increase that expires
14under this Section continues to apply to persons who applied
15and qualified for the affected benefit while the new benefit
16increase was in effect and to the affected beneficiaries and
17alternate payees of such persons, but does not apply to any
18other person, including without limitation a person who
19continues in service after the expiration date and did not
20apply and qualify for the affected benefit while the new
21benefit increase was in effect.
22(Source: P.A. 94-4, eff. 6-1-05; 95-910, eff. 8-26-08.)
 
23    (40 ILCS 5/16-205.1 new)
24    Sec. 16-205.1. Defined contribution plan.
25    (a) By July 1, 2018, the System shall prepare and implement

 

 

10000SB0011sam003- 208 -LRB100 06001 RPS 21154 a

1a voluntary defined contribution plan for up to 5% of eligible
2active Tier 1 employees. The System shall determine the 5% cap
3by the number of active Tier 1 employees on the effective date
4of this Section. The defined contribution plan developed under
5this Section shall be a plan that aggregates employer and
6employee contributions in individual participant accounts
7which, after meeting any other requirements, are used for
8payouts after retirement in accordance with this Section and
9any other applicable laws.
10    As used in this Section, "defined benefit plan" means the
11retirement plan available under this Article to Tier 1
12employees who have not made the election authorized under this
13Section.
14        (1) Under the defined contribution plan, an active Tier
15    1 employee of this System could elect to cease accruing
16    benefits in the defined benefit plan under this Article and
17    begin accruing benefits for future service in the defined
18    contribution plan. Service credit under the defined
19    contribution plan may be used for determining retirement
20    eligibility under the defined benefit plan. An active Tier
21    1 employee who elects to cease accruing benefits in his or
22    her defined benefit plan shall be prohibited from
23    purchasing service credit on or after the date of his or
24    her election. A Tier 1 employee making the irrevocable
25    election provided under this Section shall not receive
26    interest accruals to his or her benefit under paragraph (A)

 

 

10000SB0011sam003- 209 -LRB100 06001 RPS 21154 a

1    of subsection (a) of Section 16-133 on or after the date of
2    his or her election.
3        (2) Participants in the defined contribution plan
4    shall pay employee contributions at the same rate as Tier 1
5    employees in this System who do not participate in the
6    defined contribution plan.
7        (3) State contributions shall be paid into the accounts
8    of all participants in the defined contribution plan at a
9    uniform rate, expressed as a percentage of salary and
10    determined for each year. This rate shall be no higher than
11    the employer's normal cost for Tier 1 employees in the
12    defined benefit plan for that year, as determined by the
13    System and expressed as a percentage of salary, and shall
14    be no lower than 0% of salary. The State shall adjust this
15    rate annually.
16        (4) The defined contribution plan shall require 5 years
17    of participation in the defined contribution plan before
18    vesting in State contributions. If the participant fails to
19    vest in them, the State contributions, and the earnings
20    thereon, shall be forfeited.
21        (5) The defined contribution plan may provide for
22    participants in the plan to be eligible for the defined
23    disability benefits available to other participants under
24    this Article. If it does, the System shall reduce the
25    employee contributions credited to the member's defined
26    contribution plan account by an amount determined by the

 

 

10000SB0011sam003- 210 -LRB100 06001 RPS 21154 a

1    System to cover the cost of offering such benefits.
2        (6) The defined contribution plan shall provide a
3    variety of options for investments. These options shall
4    include investments in a fund created by the System and
5    managed in accordance with legal and fiduciary standards,
6    as well as investment options otherwise available.
7        (7) The defined contribution plan shall provide a
8    variety of options for payouts to retirees and their
9    survivors.
10        (8) To the extent authorized under federal law and as
11    authorized by the System, the plan shall allow former
12    participants in the plan to transfer or roll over employee
13    and vested State contributions, and the earnings thereon,
14    into other qualified retirement plans.
15        (9) The System shall reduce the employee contributions
16    credited to the member's defined contribution plan account
17    by an amount determined by the System to cover the cost of
18    offering these benefits and any applicable administrative
19    fees.
20    (b) Only persons who are active Tier 1 employees of the
21System on the effective date of this Section are eligible to
22participate in the defined contribution plan. Participation in
23the defined contribution plan shall be limited to the first 5%
24of eligible persons who elect to participate. The election to
25participate in the defined contribution plan is voluntary and
26irrevocable.

 

 

10000SB0011sam003- 211 -LRB100 06001 RPS 21154 a

1    (c) An eligible Tier 1 employee may irrevocably elect to
2participate in the defined contribution plan by filing with the
3System a written application to participate that is received by
4the System prior to its determination that 5% of eligible
5persons have elected to participate in the defined contribution
6plan.
7    When the System first determines that 5% of eligible
8persons have elected to participate in the defined contribution
9plan, the System shall provide notice to previously eligible
10employees that the plan is no longer available and shall cease
11accepting applications to participate.
12    (d) The System shall make a good faith effort to contact
13each active Tier 1 employee who is eligible to participate in
14the defined contribution plan. The System shall mail
15information describing the option to join the defined
16contribution plan to each of these employees to his or her last
17known address on file with the System. If the employee is not
18responsive to other means of contact, it is sufficient for the
19System to publish the details of the option on its website.
20    Upon request for further information describing the
21option, the System shall provide employees with information
22from the System before exercising the option to join the plan,
23including information on the impact to their vested benefits or
24non-vested service. The individual consultation shall include
25projections of the member's defined benefits at retirement or
26earlier termination of service and the value of the member's

 

 

10000SB0011sam003- 212 -LRB100 06001 RPS 21154 a

1account at retirement or earlier termination of service. The
2System shall not provide advice or counseling with respect to
3whether the employee should exercise the option. The System
4shall inform Tier 1 employees who are eligible to participate
5in the defined contribution plan that they may also wish to
6obtain information and counsel relating to their option from
7any other available source, including but not limited to labor
8organizations, private counsel, and financial advisors.
9    (e) In no event shall the System, its staff, its authorized
10representatives, or the Board be liable for any information
11given to an employee under this Section. The System may
12coordinate with the Illinois Department of Central Management
13Services and other retirement systems administering a defined
14contribution plan in accordance with this amendatory Act of the
15100th General Assembly to provide information concerning the
16impact of the option set forth in this Section.
17    (f) Notwithstanding any other provision of this Section, no
18person shall begin participating in the defined contribution
19plan until it has attained qualified plan status and received
20all necessary approvals from the U.S. Internal Revenue Service.
21    (g) The System shall report on its progress under this
22Section, including the available details of the defined
23contribution plan and the System's plans for informing eligible
24Tier 1 employees about the plan, to the Governor and the
25General Assembly on or before January 15, 2018.
26    (h) The intent of this amendatory Act of the 100th General

 

 

10000SB0011sam003- 213 -LRB100 06001 RPS 21154 a

1Assembly is to ensure that the State's normal cost of
2participation in the defined contribution plan is similar, and
3if possible equal, to the State's normal cost of participation
4in the defined benefit plan, unless a lower State's normal cost
5is necessary to ensure cost neutrality.
6    (i) If Section 16-122.9 is determined to be
7unconstitutional or otherwise invalid by a final unappealable
8decision of an Illinois court or a court of competent
9jurisdiction, then this Section shall not take effect and is
10repealed by operation of law.
 
11    (40 ILCS 5/16-206.1 new)
12    Sec. 16-206.1. Defined contribution plan; termination. If
13the defined contribution plan is terminated or becomes
14inoperative pursuant to law, then each participant in the plan
15shall automatically be deemed to have been a contributing Tier
161 employee in the System's defined benefit plan during the time
17in which he or she participated in the defined contribution
18plan, and for that purpose the System shall be entitled to
19recover the amounts in the participant's defined contribution
20accounts.
 
21    (40 ILCS 5/17-106.05 new)
22    Sec. 17-106.05. Tier 1 employee. "Tier 1 employee": A
23teacher under this Article who first became a member or
24participant before January 1, 2011 under any reciprocal

 

 

10000SB0011sam003- 214 -LRB100 06001 RPS 21154 a

1retirement system or pension fund established under this Code
2other than a retirement system or pension fund established
3under Article 2, 3, 4, 5, 6, or 18 of this Code. However, for
4the purposes of the election under Section 17-115.5, "Tier 1
5employee" does not include a teacher under this Article who
6would qualify as a Tier 1 employee but who has made an
7irrevocable election on or before June 1, 2017 to retire from
8service pursuant to the terms of an employment contract or a
9collective bargaining agreement in effect on June 1, 2017,
10excluding any extension, amendment, or renewal of that
11agreement after that date, and has notified the Fund of that
12election.
 
13    (40 ILCS 5/17-113.4 new)
14    Sec. 17-113.4. Salary. "Salary" means any income in any
15form that qualifies as "average salary" or "annual rate of
16salary" for purposes of paragraph (1) of subsection (c) of
17Section 17-116 and "salary" for payroll deduction purposes
18under Sections 17-130, 17-131, and 17-132.
19    Notwithstanding any other provision of this Section,
20"salary" does not include any future increase in income that is
21offered by an employer for service as a Tier 1 employee under
22this Article pursuant to the condition set forth in subsection
23(c) of Section 17-115.5 and accepted under that condition by a
24Tier 1 employee who has made the election under paragraph (2)
25of subsection (a) of Section 17-115.5.
 

 

 

10000SB0011sam003- 215 -LRB100 06001 RPS 21154 a

1    (40 ILCS 5/17-113.5 new)
2    Sec. 17-113.5. Future increase in income. "Future increase
3in income" means an increase to a Tier 1 employee's base pay
4that is offered by an employer to the Tier 1 employee for
5service under this Article after June 30, 2018 that qualifies
6as "salary", as defined in Section 17-113.4, or would qualify
7as "salary" but for the fact that it was offered to and
8accepted by the Tier 1 employee under the condition set forth
9in subsection (c) of Section 17-115.5. The term "future
10increase in income" includes an increase to a Tier 1 employee's
11base pay that is paid to the Tier 1 employee pursuant to an
12extension, amendment, or renewal of any employment contract or
13collective bargaining agreement after the effective date of
14this Section.
 
15    (40 ILCS 5/17-113.6 new)
16    Sec. 17-113.6. Base pay. As used in Section 17-113.5 of
17this Code, "base pay" means the greater of either (i) the Tier
181 employee's annualized rate of salary as of June 30, 2018, or
19(ii) the Tier 1 employee's annualized rate of salary
20immediately preceding the expiration, renewal, or amendment of
21an employment contract or collective bargaining agreement in
22effect on the effective date of this Section. For a person
23returning to active service as a Tier 1 employee after June 30,
242018, however, "base pay" means the employee's annualized rate

 

 

10000SB0011sam003- 216 -LRB100 06001 RPS 21154 a

1of salary as of the employee's last date of service prior to
2July 1, 2018. The Fund shall calculate the base pay of each
3Tier 1 employee pursuant to this Section.
 
4    (40 ILCS 5/17-115.5 new)
5    Sec. 17-115.5. Election by Tier 1 employees.
6    (a) Each active Tier 1 employee shall make an irrevocable
7election either:
8        (1) to agree to delay his or her eligibility for
9    automatic annual increases in service retirement pension
10    as provided in Section 17-119.2 and to have the amount of
11    the automatic annual increases in his or her service
12    retirement pension and survivor's pension that are
13    otherwise provided for in this Article calculated,
14    instead, as provided in Section 17-119.2; or
15        (2) to not agree to paragraph (1) of this subsection.
16    The election required under this subsection (a) shall be
17made by each active Tier 1 employee no earlier than January 1,
182018 and no later than March 31, 2018, except that:
19        (i) a person who becomes a Tier 1 employee under this
20    Article on or after January 1, 2018 must make the election
21    under this subsection (a) within 60 days after becoming a
22    Tier 1 employee; and
23        (ii) a person who returns to active service as a Tier 1
24    employee under this Article on or after January 1, 2018 and
25    has not yet made an election under this Section must make

 

 

10000SB0011sam003- 217 -LRB100 06001 RPS 21154 a

1    the election under this subsection (a) within 60 days after
2    returning to active service as a Tier 1 employee.
3    If a Tier 1 employee fails for any reason to make a
4required election under this subsection within the time
5specified, then the employee shall be deemed to have made the
6election under paragraph (2) of this subsection.
7    (a-5) If this Section is enjoined or stayed by an Illinois
8court or a court of competent jurisdiction pending the entry of
9a final and unappealable decision, and this Section is
10determined to be constitutional or otherwise valid by a final
11unappealable decision of an Illinois court or a court of
12competent jurisdiction, then the election procedure set forth
13in subsection (a) of this Section shall commence on the 180th
14calendar day after the date of the issuance of the final
15unappealable decision and shall conclude at the end of the
16270th calendar day after that date.
17    (a-10) All elections under subsection (a) that are made or
18deemed to be made before July 1, 2018 shall take effect on July
191, 2018. Elections that are made or deemed to be made on or
20after July 1, 2018 shall take effect on the first day of the
21month following the month in which the election is made or
22deemed to be made.
23    (b) As adequate and legal consideration provided under this
24amendatory Act of the 100th General Assembly for making an
25election under paragraph (1) of subsection (a) of this Section,
26an employer shall be expressly and irrevocably prohibited from

 

 

10000SB0011sam003- 218 -LRB100 06001 RPS 21154 a

1offering any future increases in income to a Tier 1 employee
2who has made an election under paragraph (1) of subsection (a)
3of this Section on the condition of not constituting salary
4under Section 17-113.4.
5    As adequate and legal consideration provided under this
6amendatory Act of the 100th General Assembly for making an
7election under paragraph (1) of subsection (a) of this Section,
8each Tier 1 employee who has made an election under paragraph
9(1) of subsection (a) of this Section shall receive a
10consideration payment equal to 10% of the contributions made by
11or on behalf of the employee under Section 17-130 before the
12effective date of that election. The State Comptroller shall
13pay the consideration payment to the Tier 1 employee out of
14funds appropriated for that purpose under Section 1.9 of the
15State Pension Funds Continuing Appropriation Act. The Fund
16shall calculate the amount of each consideration payment and,
17by July 1, 2018, shall certify to the State Comptroller the
18amount of the consideration payment, together with the name,
19address, and any other available payment information of the
20Tier 1 employee as found in the records of the Fund. The Fund
21shall make additional calculations and certifications of
22consideration payments to the State Comptroller as the Fund
23deems necessary.
24    (c) A Tier 1 employee who makes the election under
25paragraph (2) of subsection (a) of this Section shall not be
26subject to paragraph (1) of subsection (a) of this Section.

 

 

10000SB0011sam003- 219 -LRB100 06001 RPS 21154 a

1However, each future increase in income offered by an employer
2under this Article to a Tier 1 employee who has made the
3election under paragraph (2) of subsection (a) of this Section
4shall be offered by the employer expressly and irrevocably on
5the condition of not constituting salary under Section 17-113.4
6and that the Tier 1 employee's acceptance of the offered future
7increase in income shall constitute his or her agreement to
8that condition.
9    (d) The Fund shall make a good faith effort to contact each
10Tier 1 employee subject to this Section. The Fund shall mail
11information describing the required election to each Tier 1
12employee by United States Postal Service mail to his or her
13last known address on file with the Fund. If the Tier 1
14employee is not responsive to other means of contact, it is
15sufficient for the Fund to publish the details of any required
16elections on its website or to publish those details in a
17regularly published newsletter or other existing public forum.
18    Tier 1 employees who are subject to this Section shall be
19provided with an election packet containing information
20regarding their options, as well as the forms necessary to make
21the required election. Upon request, the Fund shall offer Tier
221 employees an opportunity to receive information from the Fund
23before making the required election. The information may
24consist of video materials, group presentations, individual
25consultation with a member or authorized representative of the
26Fund in person or by telephone or other electronic means, or

 

 

10000SB0011sam003- 220 -LRB100 06001 RPS 21154 a

1any combination of those methods. The Fund shall not provide
2advice or counseling with respect to which election a Tier 1
3employee should make or specific to the legal or tax
4circumstances of or consequences to the Tier 1 employee.
5    The Fund shall inform Tier 1 employees in the election
6packet required under this subsection that the Tier 1 employee
7may also wish to obtain information and counsel relating to the
8election required under this Section from any other available
9source, including, but not limited to, labor organizations and
10private counsel.
11    In no event shall the Fund, its staff, or the Board be held
12liable for any information given to a member regarding the
13elections under this Section. The Fund shall coordinate with
14the Illinois Department of Central Management Services and each
15other retirement system administering an election in
16accordance with this amendatory Act of the 100th General
17Assembly to provide information concerning the impact of the
18election set forth in this Section.
19    (e) Notwithstanding any other provision of law, an employer
20under this Article is required to offer each future increase in
21income expressly and irrevocably on the condition of not
22constituting "salary" under Section 17-113.4 to any Tier 1
23employee who has made an election under paragraph (2) of
24subsection (a) of this Section. The offer shall also provide
25that the Tier 1 employee's acceptance of the offered future
26increase in income shall constitute his or her agreement to the