Sen. John J. Cullerton

Filed: 2/28/2017

 

 


 

 


 
10000SB0016sam001LRB100 05169 RPS 22680 a

1
AMENDMENT TO SENATE BILL 16

2    AMENDMENT NO. ______. Amend Senate Bill 16 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 14, 15, 16, or 17 of
14the Illinois Pension Code made by the addition of Section
1514-106.5, 15-132.9, 16-122.9, or 17-115.5 of the Illinois
16Pension Code, which are deemed to be prohibited subjects of

 

 

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1bargaining. Notwithstanding any provision of this Act, the
2changes, impact of the changes, or implementation of the
3changes to Article 14, 15, 16, or 17 of the Illinois Pension
4Code made by the addition of Section 14-106.5, 15-132.9,
516-122.9, or 17-115.5 of the Illinois Pension Code shall not be
6subject to interest arbitration or any award issued pursuant to
7interest arbitration. The provisions of this Section shall not
8apply to an employment contract or collective bargaining
9agreement that is in effect on the effective date of this
10amendatory Act of the 100th General Assembly. However, any such
11contract or agreement that is modified, amended, renewed, or
12superseded after the effective date of this amendatory Act of
13the 100th General Assembly shall be subject to the provisions
14of this Section. Each employer with active employees
15participating in a retirement system or pension fund
16established under Article 14, 15, 16, or 17 of the Illinois
17Pension Code shall comply with and be subject to the provisions
18of this amendatory Act of the 100th General Assembly. The
19provisions of this Section shall not apply to the ability of
20any employer and employee representative to bargain
21collectively with regard to the pick up of employee
22contributions pursuant to Section 14-133.1, 15-157.1,
2316-152.1, 17-130.1, or 17-130.2 of the Illinois Pension Code.
24    (b) Subject to and except for the matters set forth in
25subsection (a) of this Section that are deemed prohibited
26subjects of bargaining, nothing in this Section shall be

 

 

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1construed as otherwise limiting any of the obligations and
2requirements applicable to employers under any of the
3provisions of this Act, including, but not limited to, the
4requirement to bargain collectively with regard to policy
5matters directly affecting wages, hours, and terms and
6conditions of employment as well as the impact thereon upon
7request by employee representatives. Subject to and except for
8the matters set forth in subsection (a) of this Section that
9are deemed prohibited subjects of bargaining, nothing in this
10Section shall be construed as otherwise limiting any of the
11rights of employees or employee representatives under the
12provisions of this Act.
13    (c) In case of any conflict between this Section and any
14other provisions of this Act or any other law, the provisions
15of this Section shall control.
 
16    (5 ILCS 315/10)  (from Ch. 48, par. 1610)
17    Sec. 10. Unfair labor practices.
18    (a) It shall be an unfair labor practice for an employer or
19its agents:
20        (1) to interfere with, restrain or coerce public
21    employees in the exercise of the rights guaranteed in this
22    Act or to dominate or interfere with the formation,
23    existence or administration of any labor organization or
24    contribute financial or other support to it; provided, an
25    employer shall not be prohibited from permitting employees

 

 

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1    to confer with him during working hours without loss of
2    time or pay;
3        (2) to discriminate in regard to hire or tenure of
4    employment or any term or condition of employment in order
5    to encourage or discourage membership in or other support
6    for any labor organization. Nothing in this Act or any
7    other law precludes a public employer from making an
8    agreement with a labor organization to require as a
9    condition of employment the payment of a fair share under
10    paragraph (e) of Section 6;
11        (3) to discharge or otherwise discriminate against a
12    public employee because he has signed or filed an
13    affidavit, petition or charge or provided any information
14    or testimony under this Act;
15        (4) subject to and except as provided in Section 7.6,
16    to refuse to bargain collectively in good faith with a
17    labor organization which is the exclusive representative
18    of public employees in an appropriate unit, including, but
19    not limited to, the discussing of grievances with the
20    exclusive representative; however, no actions of the
21    employer taken to implement or otherwise comply with the
22    provisions of subsection (a) of Section 7.6 shall
23    constitute or give rise to an unfair labor practice under
24    this Act;
25        (5) to violate any of the rules and regulations
26    established by the Board with jurisdiction over them

 

 

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

 

 

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

 

 

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

 

 

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

 

 

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1    (5 ILCS 315/15)  (from Ch. 48, par. 1615)
2    (Text of Section WITHOUT the changes made by P.A. 98-599,
3which has been held unconstitutional)
4    Sec. 15. Act Takes Precedence.
5    (a) In case of any conflict between the provisions of this
6Act and any other law (other than Section 5 of the State
7Employees Group Insurance Act of 1971 and other than the
8changes made to the Illinois Pension Code by this amendatory
9Act of the 96th General Assembly), executive order or
10administrative regulation relating to wages, hours and
11conditions of employment and employment relations, the
12provisions of this Act or any collective bargaining agreement
13negotiated thereunder shall prevail and control. Nothing in
14this Act shall be construed to replace or diminish the rights
15of employees established by Sections 28 and 28a of the
16Metropolitan Transit Authority Act, Sections 2.15 through 2.19
17of the Regional Transportation Authority Act. The provisions of
18this Act are subject to Section 5 of the State Employees Group
19Insurance Act of 1971. Nothing in this Act shall be construed
20to replace the necessity of complaints against a sworn peace
21officer, as defined in Section 2(a) of the Uniform Peace
22Officer Disciplinary Act, from having a complaint supported by
23a sworn affidavit.
24    (b) Except as provided in subsection (a) above, any
25collective bargaining contract between a public employer and a
26labor organization executed pursuant to this Act shall

 

 

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1supersede any contrary statutes, charters, ordinances, rules
2or regulations relating to wages, hours and conditions of
3employment and employment relations adopted by the public
4employer or its agents. Any collective bargaining agreement
5entered into prior to the effective date of this Act shall
6remain in full force during its duration.
7    (c) It is the public policy of this State, pursuant to
8paragraphs (h) and (i) of Section 6 of Article VII of the
9Illinois Constitution, that the provisions of this Act are the
10exclusive exercise by the State of powers and functions which
11might otherwise be exercised by home rule units. Such powers
12and functions may not be exercised concurrently, either
13directly or indirectly, by any unit of local government,
14including any home rule unit, except as otherwise authorized by
15this Act.
16    (d) Notwithstanding any other provision of law, no
17collective bargaining agreement entered into, renewed, or
18extended after the effective date of this amendatory Act of the
19100th General Assembly or any arbitration award issued under
20such collective bargaining agreement may violate or conflict
21with the changes made by this amendatory Act of the 100th
22General Assembly.
23(Source: P.A. 95-331, eff. 8-21-07; 96-889, eff. 1-1-11.)
 
24    Section 10. The State Employees Group Insurance Act of 1971
25is amended by changing Sections 3 and 10 as follows:
 

 

 

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1    (5 ILCS 375/3)  (from Ch. 127, par. 523)
2    Sec. 3. Definitions. Unless the context otherwise
3requires, the following words and phrases as used in this Act
4shall have the following meanings. The Department may define
5these and other words and phrases separately for the purpose of
6implementing specific programs providing benefits under this
7Act.
8    (a) "Administrative service organization" means any
9person, firm or corporation experienced in the handling of
10claims which is fully qualified, financially sound and capable
11of meeting the service requirements of a contract of
12administration executed with the Department.
13    (b) "Annuitant" means (1) an employee who retires, or has
14retired, on or after January 1, 1966 on an immediate annuity
15under the provisions of Articles 2, 14 (including an employee
16who has elected to receive an alternative retirement
17cancellation payment under Section 14-108.5 of the Illinois
18Pension Code in lieu of an annuity or who meets the criteria
19for retirement, but in lieu of receiving an annuity under that
20Article has elected to receive an accelerated pension benefit
21payment under Section 14-147.5 of that Article), 15 (including
22an employee who has retired under the optional retirement
23program established under Section 15-158.2 or who meets the
24criteria for retirement but in lieu of receiving an annuity
25under that Article has elected to receive an accelerated

 

 

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1pension benefit payment under Section 15-185.5 of the Article),
2paragraphs (2), (3), or (5) of Section 16-106 (including an
3employee who meets the criteria for retirement, but in lieu of
4receiving an annuity under that Article has elected to receive
5an accelerated pension benefit payment under Section 16-190.5
6of the Illinois Pension Code), or Article 18 of the Illinois
7Pension Code; (2) any person who was receiving group insurance
8coverage under this Act as of March 31, 1978 by reason of his
9status as an annuitant, even though the annuity in relation to
10which such coverage was provided is a proportional annuity
11based on less than the minimum period of service required for a
12retirement annuity in the system involved; (3) any person not
13otherwise covered by this Act who has retired as a
14participating member under Article 2 of the Illinois Pension
15Code but is ineligible for the retirement annuity under Section
162-119 of the Illinois Pension Code; (4) the spouse of any
17person who is receiving a retirement annuity under Article 18
18of the Illinois Pension Code and who is covered under a group
19health insurance program sponsored by a governmental employer
20other than the State of Illinois and who has irrevocably
21elected to waive his or her coverage under this Act and to have
22his or her spouse considered as the "annuitant" under this Act
23and not as a "dependent"; or (5) an employee who retires, or
24has retired, from a qualified position, as determined according
25to rules promulgated by the Director, under a qualified local
26government, a qualified rehabilitation facility, a qualified

 

 

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1domestic violence shelter or service, or a qualified child
2advocacy center. (For definition of "retired employee", see (p)
3post).
4    (b-5) (Blank).
5    (b-6) (Blank).
6    (b-7) (Blank).
7    (c) "Carrier" means (1) an insurance company, a corporation
8organized under the Limited Health Service Organization Act or
9the Voluntary Health Services Plan Act, a partnership, or other
10nongovernmental organization, which is authorized to do group
11life or group health insurance business in Illinois, or (2) the
12State of Illinois as a self-insurer.
13    (d) "Compensation" means salary or wages payable on a
14regular payroll by the State Treasurer on a warrant of the
15State Comptroller out of any State, trust or federal fund, or
16by the Governor of the State through a disbursing officer of
17the State out of a trust or out of federal funds, or by any
18Department out of State, trust, federal or other funds held by
19the State Treasurer or the Department, to any person for
20personal services currently performed, and ordinary or
21accidental disability benefits under Articles 2, 14, 15
22(including ordinary or accidental disability benefits under
23the optional retirement program established under Section
2415-158.2), paragraphs (2), (3), or (5) of Section 16-106, or
25Article 18 of the Illinois Pension Code, for disability
26incurred after January 1, 1966, or benefits payable under the

 

 

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1Workers' Compensation or Occupational Diseases Act or benefits
2payable under a sick pay plan established in accordance with
3Section 36 of the State Finance Act. "Compensation" also means
4salary or wages paid to an employee of any qualified local
5government, qualified rehabilitation facility, qualified
6domestic violence shelter or service, or qualified child
7advocacy center.
8    (e) "Commission" means the State Employees Group Insurance
9Advisory Commission authorized by this Act. Commencing July 1,
101984, "Commission" as used in this Act means the Commission on
11Government Forecasting and Accountability as established by
12the Legislative Commission Reorganization Act of 1984.
13    (f) "Contributory", when referred to as contributory
14coverage, shall mean optional coverages or benefits elected by
15the member toward the cost of which such member makes
16contribution, or which are funded in whole or in part through
17the acceptance of a reduction in earnings or the foregoing of
18an increase in earnings by an employee, as distinguished from
19noncontributory coverage or benefits which are paid entirely by
20the State of Illinois without reduction of the member's salary.
21    (g) "Department" means any department, institution, board,
22commission, officer, court or any agency of the State
23government receiving appropriations and having power to
24certify payrolls to the Comptroller authorizing payments of
25salary and wages against such appropriations as are made by the
26General Assembly from any State fund, or against trust funds

 

 

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1held by the State Treasurer and includes boards of trustees of
2the retirement systems created by Articles 2, 14, 15, 16 and 18
3of the Illinois Pension Code. "Department" also includes the
4Illinois Comprehensive Health Insurance Board, the Board of
5Examiners established under the Illinois Public Accounting
6Act, and the Illinois Finance Authority.
7    (h) "Dependent", when the term is used in the context of
8the health and life plan, means a member's spouse and any child
9(1) from birth to age 26 including an adopted child, a child
10who lives with the member from the time of the filing of a
11petition for adoption until entry of an order of adoption, a
12stepchild or adjudicated child, or a child who lives with the
13member if such member is a court appointed guardian of the
14child or (2) age 19 or over who has a mental or physical
15disability from a cause originating prior to the age of 19 (age
1626 if enrolled as an adult child dependent). For the health
17plan only, the term "dependent" also includes (1) any person
18enrolled prior to the effective date of this Section who is
19dependent upon the member to the extent that the member may
20claim such person as a dependent for income tax deduction
21purposes and (2) any person who has received after June 30,
222000 an organ transplant and who is financially dependent upon
23the member and eligible to be claimed as a dependent for income
24tax purposes. A member requesting to cover any dependent must
25provide documentation as requested by the Department of Central
26Management Services and file with the Department any and all

 

 

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

 

 

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

 

 

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

 

 

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

 

 

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1Cooperative Extension Service who would be an annuitant except
2for the fact that such person was made ineligible to
3participate in the State Universities Retirement System by
4clause (4) of subsection (a) of Section 15-107 of the Illinois
5Pension Code; and (3) the surviving dependent of a person who
6was an annuitant under this Act by virtue of receiving an
7alternative retirement cancellation payment under Section
814-108.5 of the Illinois Pension Code.
9    (q-2) "SERS" means the State Employees' Retirement System
10of Illinois, created under Article 14 of the Illinois Pension
11Code.
12    (q-3) "SURS" means the State Universities Retirement
13System, created under Article 15 of the Illinois Pension Code.
14    (q-4) "TRS" means the Teachers' Retirement System of the
15State of Illinois, created under Article 16 of the Illinois
16Pension Code.
17    (q-5) (Blank).
18    (q-6) (Blank).
19    (q-7) (Blank).
20    (r) "Medical services" means the services provided within
21the scope of their licenses by practitioners in all categories
22licensed under the Medical Practice Act of 1987.
23    (s) "Unit of local government" means any county,
24municipality, township, school district (including a
25combination of school districts under the Intergovernmental
26Cooperation Act), special district or other unit, designated as

 

 

10000SB0016sam001- 21 -LRB100 05169 RPS 22680 a

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

 

 

10000SB0016sam001- 22 -LRB100 05169 RPS 22680 a

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

 

 

10000SB0016sam001- 23 -LRB100 05169 RPS 22680 a

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

 

 

10000SB0016sam001- 24 -LRB100 05169 RPS 22680 a

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

 

 

10000SB0016sam001- 25 -LRB100 05169 RPS 22680 a

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

 

 

10000SB0016sam001- 26 -LRB100 05169 RPS 22680 a

1    Sec. 10. Contributions by the State and members.
2    (a) The State shall pay the cost of basic non-contributory
3group life insurance and, subject to member paid contributions
4set by the Department or required by this Section and except as
5provided in this Section, the basic program of group health
6benefits on each eligible member, except a member, not
7otherwise covered by this Act, who has retired as a
8participating member under Article 2 of the Illinois Pension
9Code but is ineligible for the retirement annuity under Section
102-119 of the Illinois Pension Code, and part of each eligible
11member's and retired member's premiums for health insurance
12coverage for enrolled dependents as provided by Section 9. The
13State shall pay the cost of the basic program of group health
14benefits only after benefits are reduced by the amount of
15benefits covered by Medicare for all members and dependents who
16are eligible for benefits under Social Security or the Railroad
17Retirement system or who had sufficient Medicare-covered
18government employment, except that such reduction in benefits
19shall apply only to those members and dependents who (1) first
20become eligible for such Medicare coverage on or after July 1,
211992; or (2) are Medicare-eligible members or dependents of a
22local government unit which began participation in the program
23on or after July 1, 1992; or (3) remain eligible for, but no
24longer receive Medicare coverage which they had been receiving
25on or after July 1, 1992. The Department may determine the
26aggregate level of the State's contribution on the basis of

 

 

10000SB0016sam001- 27 -LRB100 05169 RPS 22680 a

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

 

 

10000SB0016sam001- 28 -LRB100 05169 RPS 22680 a

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

 

 

10000SB0016sam001- 29 -LRB100 05169 RPS 22680 a

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

 

 

10000SB0016sam001- 30 -LRB100 05169 RPS 22680 a

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

 

 

10000SB0016sam001- 31 -LRB100 05169 RPS 22680 a

1    (b) State employees who become eligible for this program on
2or after January 1, 1980 in positions normally requiring actual
3performance of duty not less than 1/2 of a normal work period
4but not equal to that of a normal work period, shall be given
5the option of participating in the available program. If the
6employee elects coverage, the State shall contribute on behalf
7of such employee to the cost of the employee's benefit and any
8applicable dependent supplement, that sum which bears the same
9percentage as that percentage of time the employee regularly
10works when compared to normal work period.
11    (c) The basic non-contributory coverage from the basic
12program of group health benefits shall be continued for each
13employee not in pay status or on active service by reason of
14(1) leave of absence due to illness or injury, (2) authorized
15educational leave of absence or sabbatical leave, or (3)
16military leave. This coverage shall continue until expiration
17of authorized leave and return to active service, but not to
18exceed 24 months for leaves under item (1) or (2). This
1924-month limitation and the requirement of returning to active
20service shall not apply to persons receiving ordinary or
21accidental disability benefits or retirement benefits through
22the appropriate State retirement system or benefits under the
23Workers' Compensation or Occupational Disease Act.
24    (d) The basic group life insurance coverage shall continue,
25with full State contribution, where such person is (1) absent
26from active service by reason of disability arising from any

 

 

10000SB0016sam001- 32 -LRB100 05169 RPS 22680 a

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

 

 

10000SB0016sam001- 33 -LRB100 05169 RPS 22680 a

1the 91st General Assembly.
2    (h) Those persons occupying positions with any department
3as a result of emergency appointments pursuant to Section 8b.8
4of the Personnel Code who are not considered employees under
5this Act shall be given the option of participating in the
6programs of group life insurance, health benefits and other
7employee benefits. Such persons electing coverage may
8participate only by making payment equal to the amount normally
9contributed by the State for similarly situated employees. Such
10amounts shall be determined by the Director. Such payments and
11coverage may be continued until such time as the person becomes
12an employee pursuant to this Act or such person's appointment
13is terminated.
14    (i) Any unit of local government within the State of
15Illinois may apply to the Director to have its employees,
16annuitants, and their dependents provided group health
17coverage under this Act on a non-insured basis. To participate,
18a unit of local government must agree to enroll all of its
19employees, who may select coverage under either the State group
20health benefits plan or a health maintenance organization that
21has contracted with the State to be available as a health care
22provider for employees as defined in this Act. A unit of local
23government must remit the entire cost of providing coverage
24under the State group health benefits plan or, for coverage
25under a health maintenance organization, an amount determined
26by the Director based on an analysis of the sex, age,

 

 

10000SB0016sam001- 34 -LRB100 05169 RPS 22680 a

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

 

 

10000SB0016sam001- 35 -LRB100 05169 RPS 22680 a

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

 

 

10000SB0016sam001- 36 -LRB100 05169 RPS 22680 a

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

 

 

10000SB0016sam001- 37 -LRB100 05169 RPS 22680 a

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

 

 

10000SB0016sam001- 38 -LRB100 05169 RPS 22680 a

1dependent under this plan or another group policy or plan, and
2(2) at least 50% of the employees are enrolled and the
3rehabilitation facility remits the entire cost of providing
4coverage to those employees. Employees of a participating
5rehabilitation facility who are not enrolled due to coverage
6under another group health policy or plan may enroll in the
7event of a qualifying change in status, special enrollment,
8special circumstance as defined by the Director, or during the
9annual Benefit Choice Period. A participating rehabilitation
10facility may also elect to cover its annuitants. Dependent
11coverage shall be offered on an optional basis, with the costs
12paid by the rehabilitation facility, its employees, or some
13combination of the 2 as determined by the rehabilitation
14facility. The rehabilitation facility shall be responsible for
15timely collection and transmission of dependent premiums.
16    The Director shall annually determine quarterly rates of
17payment, subject to the following constraints:
18        (1) In the first year of coverage, the rates shall be
19    equal to the amount normally charged to State employees for
20    elected optional coverages or for enrolled dependents
21    coverages or other contributory coverages on behalf of its
22    employees, adjusted for differences between State
23    employees and employees of the rehabilitation facility in
24    age, sex, geographic location or other relevant
25    demographic variables, plus an amount sufficient to pay for
26    the additional administrative costs of providing coverage

 

 

10000SB0016sam001- 39 -LRB100 05169 RPS 22680 a

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

 

 

10000SB0016sam001- 40 -LRB100 05169 RPS 22680 a

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

 

 

10000SB0016sam001- 41 -LRB100 05169 RPS 22680 a

1    Monthly payments by the domestic violence shelter or
2service or its employees for group health insurance shall be
3deposited in the Local Government Health Insurance Reserve
4Fund.
5    (l) A public community college or entity organized pursuant
6to the Public Community College Act may apply to the Director
7initially to have only annuitants not covered prior to July 1,
81992 by the district's health plan provided health coverage
9under this Act on a non-insured basis. The community college
10must execute a 2-year contract to participate in the Local
11Government Health Plan. Any annuitant may enroll in the event
12of a qualifying change in status, special enrollment, special
13circumstance as defined by the Director, or during the annual
14Benefit Choice Period.
15    The Director shall annually determine monthly rates of
16payment subject to the following constraints: for those
17community colleges with annuitants only enrolled, first year
18rates shall be equal to the average cost to cover claims for a
19State member adjusted for demographics, Medicare
20participation, and other factors; and in the second year, a
21further adjustment of rates shall be made to reflect the actual
22first year's claims experience of the covered annuitants.
23    (l-5) The provisions of subsection (l) become inoperative
24on July 1, 1999.
25    (m) The Director shall adopt any rules deemed necessary for
26implementation of this amendatory Act of 1989 (Public Act

 

 

10000SB0016sam001- 42 -LRB100 05169 RPS 22680 a

186-978).
2    (n) Any child advocacy center within the State of Illinois
3may apply to the Director to have its employees, annuitants,
4and their dependents provided group health coverage under this
5Act on a non-insured basis. To participate, a child advocacy
6center must agree to enroll all of its employees and pay the
7entire cost of providing coverage for its employees. The child
8advocacy center shall not be required to enroll those of its
9employees who are covered spouses or dependents under this plan
10or another group policy or plan providing health benefits as
11long as (1) an appropriate official from the child advocacy
12center attests that each employee not enrolled is a covered
13spouse or dependent under this plan or another group policy or
14plan and (2) at least 50% of the employees are enrolled and the
15child advocacy center remits the entire cost of providing
16coverage to those employees. Employees of a participating child
17advocacy center who are not enrolled due to coverage under
18another group health policy or plan may enroll in the event of
19a qualifying change in status, special enrollment, or special
20circumstance as defined by the Director or during the annual
21Benefit Choice Period. A participating child advocacy center
22may also elect to cover its annuitants. Dependent coverage
23shall be offered on an optional basis, with the costs paid by
24the child advocacy center, its employees, or some combination
25of the 2 as determined by the child advocacy center. The child
26advocacy center shall be responsible for timely collection and

 

 

10000SB0016sam001- 43 -LRB100 05169 RPS 22680 a

1transmission of dependent premiums.
2    The Director shall annually determine rates of payment,
3subject to the following constraints:
4        (1) In the first year of coverage, the rates shall be
5    equal to the amount normally charged to State employees for
6    elected optional coverages or for enrolled dependents
7    coverages or other contributory coverages on behalf of its
8    employees, adjusted for differences between State
9    employees and employees of the child advocacy center in
10    age, sex, geographic location, or other relevant
11    demographic variables, plus an amount sufficient to pay for
12    the additional administrative costs of providing coverage
13    to employees of the child advocacy center and their
14    dependents.
15        (2) In subsequent years, a further adjustment shall be
16    made to reflect the actual prior years' claims experience
17    of the employees of the child advocacy center.
18    Monthly payments by the child advocacy center or its
19employees for group health insurance shall be deposited into
20the Local Government Health Insurance Reserve Fund.
21(Source: P.A. 97-695, eff. 7-1-12; 98-488, eff. 8-16-13.)
 
22    Section 15. The Civil Administrative Code of Illinois is
23amended by adding Section 5-647 as follows:
 
24    (20 ILCS 5/5-647 new)

 

 

10000SB0016sam001- 44 -LRB100 05169 RPS 22680 a

1    Sec. 5-647. Future increases in income. A Department must
2not pay, offer, or agree to pay any future increase in income,
3as that term is defined in Section 14-103.42, 15-112.1, or
416-121.1 of the Illinois Pension Code, to any person in a
5manner that violates Section 14-106.5, 15-132.9, or 16-122.9 of
6the Illinois Pension Code.
 
7    Section 20. The Attorney General Act is amended by adding
8Section 5 as follows:
 
9    (15 ILCS 205/5 new)
10    Sec. 5. Future increases in income. The Office of the
11Attorney General must not pay, offer, or agree to pay any
12future increase in income, as that term is defined in Section
1314-103.42 of the Illinois Pension Code, to any person in a
14manner that violates Section 14-106.5 of the Illinois Pension
15Code.
 
16    Section 25. The Secretary of State Merit Employment Code is
17amended by adding Section 13a as follows:
 
18    (15 ILCS 310/13a new)
19    Sec. 13a. Future increases in income. The Office of the
20Secretary of State must not pay, offer, or agree to pay any
21future increase in income, as that term is defined in Section
2214-103.42 of the Illinois Pension Code, to any person in a

 

 

10000SB0016sam001- 45 -LRB100 05169 RPS 22680 a

1manner that violates Section 14-106.5 of the Illinois Pension
2Code.
 
3    Section 30. The Comptroller Merit Employment Code is
4amended by adding Section 13a as follows:
 
5    (15 ILCS 410/13a new)
6    Sec. 13a. Future increases in income. The Office of the
7Comptroller must not pay, offer, or agree to pay any future
8increase in income, as that term is defined in Section
914-103.42 of the Illinois Pension Code, to any person in a
10manner that violates Section 14-106.5 of the Illinois Pension
11Code.
 
12    Section 35. The State Treasurer Employment Code is amended
13by adding Section 12a as follows:
 
14    (15 ILCS 510/12a new)
15    Sec. 12a. Future increases in income. The Office of the
16State Treasurer must not pay, offer, or agree to pay any future
17increase in income, as that term is defined in Section
1814-103.42 of the Illinois Pension Code, to any person in a
19manner that violates Section 14-106.5 of the Illinois Pension
20Code.
 
21    Section 40. The Budget Stabilization Act is amended by

 

 

10000SB0016sam001- 46 -LRB100 05169 RPS 22680 a

1changing Section 20 as follows:
 
2    (30 ILCS 122/20)
3    (Text of Section WITHOUT the changes made by P.A. 98-599,
4which has been held unconstitutional)
5    Sec. 20. Pension Stabilization Fund.
6    (a) The Pension Stabilization Fund is hereby created as a
7special fund in the State treasury. Moneys in the fund shall be
8used for the sole purpose of making payments to the designated
9retirement systems as provided in Section 25.
10    (b) For each fiscal year through State fiscal year 2020,
11when the General Assembly's appropriations and transfers or
12diversions as required by law from general funds do not exceed
1399% of the estimated general funds revenues pursuant to
14subsection (a) of Section 10, the Comptroller shall transfer
15from the General Revenue Fund as provided by this Section a
16total amount equal to 0.5% of the estimated general funds
17revenues to the Pension Stabilization Fund.
18    (c) For each fiscal year through State fiscal year 2020,
19when the General Assembly's appropriations and transfers or
20diversions as required by law from general funds do not exceed
2198% of the estimated general funds revenues pursuant to
22subsection (b) of Section 10, the Comptroller shall transfer
23from the General Revenue Fund as provided by this Section a
24total amount equal to 1.0% of the estimated general funds
25revenues to the Pension Stabilization Fund.

 

 

10000SB0016sam001- 47 -LRB100 05169 RPS 22680 a

1    (c-5) In addition to any other amounts required to be
2transferred under this Section, in State fiscal year 2021 and
3each fiscal year thereafter through State fiscal year 2045, or
4when each of the designated retirement systems, as defined in
5Section 25, has achieved 100% funding, whichever occurs first,
6the State Comptroller shall order transferred and the State
7Treasurer shall transfer from the General Revenue Fund to the
8Pension Stabilization Fund an amount equal to (1) the sum of
9the amounts certified by the designated retirement systems
10under subsection (a-10) of Section 14-135.08, subsection
11(a-10) of Section 15-165, and subsection (a-10) of Section
1216-158 of this Code for that fiscal year minus (2) the sum of
13the required State contributions certified by the retirement
14systems under subsection (a-5) of Section 14-135.08,
15subsection (a-5) of Section 15-165, and subsection (a-5) of
16Section 16-158 of this Code for that fiscal year. The
17transferred amount is intended to represent the annual savings
18to the State resulting from the enactment of Section 1-161 and
19Section 14-155.2, the enactment of subsection (a-2) of Section
2015-155 and subsection (b-4) of Section 16-158, and the changes
21made to Section 1-160 by this amendatory Act of the 100th
22General Assembly.
23    (d) The Comptroller shall transfer 1/12 of the total amount
24to be transferred each fiscal year under this Section into the
25Pension Stabilization Fund on the first day of each month of
26that fiscal year or as soon thereafter as possible; except that

 

 

10000SB0016sam001- 48 -LRB100 05169 RPS 22680 a

1the final transfer of the fiscal year shall be made as soon as
2practical after the August 31 following the end of the fiscal
3year.
4    Until State fiscal year 2021, before Before the final
5transfer for a fiscal year is made, the Comptroller shall
6reconcile the estimated general funds revenues used in
7calculating the other transfers under this Section for that
8fiscal year with the actual general funds revenues for that
9fiscal year. The final transfer for the fiscal year shall be
10adjusted so that the total amount transferred under this
11Section for that fiscal year is equal to the percentage
12specified in subsection (b) or (c) of this Section, whichever
13is applicable, of the actual general funds revenues for that
14fiscal year. The actual general funds revenues for the fiscal
15year shall be calculated in a manner consistent with subsection
16(c) of Section 10 of this Act.
17(Source: P.A. 94-839, eff. 6-6-06.)
 
18    Section 45. The Illinois Pension Code is amended by
19changing Sections 1-160, 2-101, 2-105, 2-107, 2-108, 2-119.1,
202-124, 2-126, 2-134, 2-162, 14-103.10, 14-114, 14-131, 14-133,
2114-135.08, 14-152.1, 15-108.1, 15-108.2, 15-111, 15-136,
2215-155, 15-157, 15-165, 15-198, 16-121, 16-133.1, 16-136.1,
2316-152, 16-158, 16-203, 17-116, 17-119.2, 17-129, 17-130,
2418-131, 18-140, 20-121, 20-123, 20-124, and 20-125 and by
25adding Sections 1-161, 1-162, 2-105.3, 2-107.9, 2-107.10,

 

 

10000SB0016sam001- 49 -LRB100 05169 RPS 22680 a

12-110.3, 2-165.1, 2-166.1, 14-103.41, 14-103.42, 14-103.43,
214-106.5, 14-147.5, 14-155.1, 14-155.2, 14-156.1, 15-112.1,
315-112.2, 15-132.9, 15-185.5, 15-200.1, 15-201.1, 16-107.1,
416-121.1, 16-121.2, 16-122.9, 16-190.5, 16-205.1, 16-206.1,
517-106.05, 17-113.4, 17-113.5, 17-113.6, and 17-115.5 as
6follows:
 
7    (40 ILCS 5/1-160)
8    (Text of Section WITHOUT the changes made by P.A. 98-641,
9which has been held unconstitutional)
10    Sec. 1-160. Provisions applicable to new hires.
11    (a) The provisions of this Section apply to a person who,
12on or after January 1, 2011, first becomes a member or a
13participant under any reciprocal retirement system or pension
14fund established under this Code, other than a retirement
15system or pension fund established under Article 2, 3, 4, 5, 6,
1615 or 18 of this Code, notwithstanding any other provision of
17this Code to the contrary, but do not apply to any self-managed
18plan established under this Code, to any person with respect to
19service as a sheriff's law enforcement employee under Article
207, or to any participant of the retirement plan established
21under Section 22-101. Notwithstanding anything to the contrary
22in this Section, for purposes of this Section, a person who
23participated in a retirement system under Article 15 prior to
24January 1, 2011 shall be deemed a person who first became a
25member or participant prior to January 1, 2011 under any

 

 

10000SB0016sam001- 50 -LRB100 05169 RPS 22680 a

1retirement system or pension fund subject to this Section. The
2changes made to this Section by Public Act 98-596 this
3amendatory Act of the 98th General Assembly are a clarification
4of existing law and are intended to be retroactive to January
51, 2011 (the effective date of Public Act 96-889),
6notwithstanding the provisions of Section 1-103.1 of this Code.
7    This Section does not apply to a person who, on or after 6
8months after the effective date of this amendatory Act of the
9100th General Assembly, first becomes a member or participant
10under Article 14 or 16, unless that person (i) is a covered
11employee under Article 14 who has not elected to participate in
12the defined contribution plan under Section 14-155.2 or (ii)
13elects under subsection (b) of Section 1-161 to receive the
14benefits provided under this Section and the applicable
15provisions of the Article under which he or she is a member or
16participant. This Section also does not apply to a person who
17first becomes a member or participant of an affected pension
18fund on or after 6 months after the resolution or ordinance
19date, as defined in Section 1-162, unless that person elects
20under subsection (c) of Section 1-162 to receive the benefits
21provided under this Section and the applicable provisions of
22the Article under which he or she is a member or participant.
23    (b) "Final average salary" means the average monthly (or
24annual) salary obtained by dividing the total salary or
25earnings calculated under the Article applicable to the member
26or participant during the 96 consecutive months (or 8

 

 

10000SB0016sam001- 51 -LRB100 05169 RPS 22680 a

1consecutive years) of service within the last 120 months (or 10
2years) of service in which the total salary or earnings
3calculated under the applicable Article was the highest by the
4number of months (or years) of service in that period. For the
5purposes of a person who first becomes a member or participant
6of any retirement system or pension fund to which this Section
7applies on or after January 1, 2011, in this Code, "final
8average salary" shall be substituted for the following:
9        (1) In Article 7 (except for service as sheriff's law
10    enforcement employees), "final rate of earnings".
11        (2) In Articles 8, 9, 10, 11, and 12, "highest average
12    annual salary for any 4 consecutive years within the last
13    10 years of service immediately preceding the date of
14    withdrawal".
15        (3) In Article 13, "average final salary".
16        (4) In Article 14, "final average compensation".
17        (5) In Article 17, "average salary".
18        (6) In Section 22-207, "wages or salary received by him
19    at the date of retirement or discharge".
20    (b-5) Beginning on January 1, 2011, for all purposes under
21this Code (including without limitation the calculation of
22benefits and employee contributions), the annual earnings,
23salary, or wages (based on the plan year) of a member or
24participant to whom this Section applies shall not exceed
25$106,800; however, that amount shall annually thereafter be
26increased by the lesser of (i) 3% of that amount, including all

 

 

10000SB0016sam001- 52 -LRB100 05169 RPS 22680 a

1previous adjustments, or (ii) one-half the annual unadjusted
2percentage increase (but not less than zero) in the consumer
3price index-u for the 12 months ending with the September
4preceding each November 1, including all previous adjustments.
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 boards of the retirement
13systems and pension funds by November 1 of each year.
14    (c) A member or participant is entitled to a retirement
15annuity upon written application if he or she has attained age
1667 (beginning January 1, 2015, age 65 with respect to service
17under Article 12 of this Code that is subject to this Section)
18and has at least 10 years of service credit and is otherwise
19eligible under the requirements of the applicable Article.
20    A member or participant who has attained age 62 (beginning
21January 1, 2015, age 60 with respect to service under Article
2212 of this Code that is subject to this Section) and has at
23least 10 years of service credit and is otherwise eligible
24under the requirements of the applicable Article may elect to
25receive the lower retirement annuity provided in subsection (d)
26of this Section.

 

 

10000SB0016sam001- 53 -LRB100 05169 RPS 22680 a

1    (d) The retirement annuity of a member or participant who
2is retiring after attaining age 62 (beginning January 1, 2015,
3age 60 with respect to service under Article 12 of this Code
4that is subject to this Section) with at least 10 years of
5service credit shall be reduced by one-half of 1% for each full
6month that the member's age is under age 67 (beginning January
71, 2015, age 65 with respect to service under Article 12 of
8this Code that is subject to this Section).
9    (e) Any retirement annuity or supplemental annuity shall be
10subject to annual increases on the January 1 occurring either
11on or after the attainment of age 67 (beginning January 1,
122015, age 65 with respect to service under Article 12 of this
13Code that is subject to this Section) or the first anniversary
14of the annuity start date, whichever is later. Each annual
15increase shall be calculated at 3% or one-half the annual
16unadjusted percentage increase (but not less than zero) in the
17consumer price index-u for the 12 months ending with the
18September preceding each November 1, whichever is less, of the
19originally granted retirement annuity. If the annual
20unadjusted percentage change in the consumer price index-u for
21the 12 months ending with the September preceding each November
221 is zero or there is a decrease, then the annuity shall not be
23increased.
24    (f) The initial survivor's or widow's annuity of an
25otherwise eligible survivor or widow of a retired member or
26participant who first became a member or participant on or

 

 

10000SB0016sam001- 54 -LRB100 05169 RPS 22680 a

1after January 1, 2011 shall be in the amount of 66 2/3% of the
2retired member's or participant's retirement annuity at the
3date of death. In the case of the death of a member or
4participant who has not retired and who first became a member
5or participant on or after January 1, 2011, eligibility for a
6survivor's or widow's annuity shall be determined by the
7applicable Article of this Code. The initial benefit shall be
866 2/3% of the earned annuity without a reduction due to age. A
9child's annuity of an otherwise eligible child shall be in the
10amount prescribed under each Article if applicable. Any
11survivor's or widow's annuity shall be increased (1) on each
12January 1 occurring on or after the commencement of the annuity
13if the deceased member died while receiving a retirement
14annuity or (2) in other cases, on each January 1 occurring
15after the first anniversary of the commencement of the annuity.
16Each annual increase shall be calculated at 3% or one-half the
17annual unadjusted percentage increase (but not less than zero)
18in the consumer price index-u for the 12 months ending with the
19September preceding each November 1, whichever is less, of the
20originally granted survivor's annuity. If the annual
21unadjusted percentage change in the consumer price index-u for
22the 12 months ending with the September preceding each November
231 is zero or there is a decrease, then the annuity shall not be
24increased.
25    (g) The benefits in Section 14-110 apply only if the person
26is a State policeman, a fire fighter in the fire protection

 

 

10000SB0016sam001- 55 -LRB100 05169 RPS 22680 a

1service of a department, or a security employee of the
2Department of Corrections or the Department of Juvenile
3Justice, as those terms are defined in subsection (b) of
4Section 14-110. A person who meets the requirements of this
5Section is entitled to an annuity calculated under the
6provisions of Section 14-110, in lieu of the regular or minimum
7retirement annuity, only if the person has withdrawn from
8service with not less than 20 years of eligible creditable
9service and has attained age 60, regardless of whether the
10attainment of age 60 occurs while the person is still in
11service.
12    (h) If a person who first becomes a member or a participant
13of a retirement system or pension fund subject to this Section
14on or after January 1, 2011 is receiving a retirement annuity
15or retirement pension under that system or fund and becomes a
16member or participant under any other system or fund created by
17this Code and is employed on a full-time basis, except for
18those members or participants exempted from the provisions of
19this Section under subsection (a) of this Section, then the
20person's retirement annuity or retirement pension under that
21system or fund shall be suspended during that employment. Upon
22termination of that employment, the person's retirement
23annuity or retirement pension payments shall resume and be
24recalculated if recalculation is provided for under the
25applicable Article of this Code.
26    If a person who first becomes a member of a retirement

 

 

10000SB0016sam001- 56 -LRB100 05169 RPS 22680 a

1system or pension fund subject to this Section on or after
2January 1, 2012 and is receiving a retirement annuity or
3retirement pension under that system or fund and accepts on a
4contractual basis a position to provide services to a
5governmental entity from which he or she has retired, then that
6person's annuity or retirement pension earned as an active
7employee of the employer shall be suspended during that
8contractual service. A person receiving an annuity or
9retirement pension under this Code shall notify the pension
10fund or retirement system from which he or she is receiving an
11annuity or retirement pension, as well as his or her
12contractual employer, of his or her retirement status before
13accepting contractual employment. A person who fails to submit
14such notification shall be guilty of a Class A misdemeanor and
15required to pay a fine of $1,000. Upon termination of that
16contractual employment, the person's retirement annuity or
17retirement pension payments shall resume and, if appropriate,
18be recalculated under the applicable provisions of this Code.
19    (i) (Blank).
20    (j) Except for Sections 1-161 and 1-162, in In the case of
21a conflict between the provisions of this Section and any other
22provision of this Code, the provisions of this Section shall
23control.
24(Source: P.A. 97-609, eff. 1-1-12; 98-92, eff. 7-16-13; 98-596,
25eff. 11-19-13; 98-622, eff. 6-1-14; revised 3-24-16.)
 

 

 

10000SB0016sam001- 57 -LRB100 05169 RPS 22680 a

1    (40 ILCS 5/1-161 new)
2    Sec. 1-161. Optional benefits for certain Tier 2 members
3under Articles 14, 15, and 16.
4    (a) Notwithstanding any other provision of this Code to the
5contrary, the provisions of this Section apply to a person who,
6on or after 6 months after the effective date of this
7amendatory Act of the 100th General Assembly, first becomes a
8member or a participant under Article 14, 15, or 16 and who
9does not make the election under subsection (b) or (c),
10whichever is applicable. The provisions of this Section do not
11apply to any participant in a self-managed plan or to a covered
12employee under Article 14.
13    (b) In lieu of the benefits provided under this Section, a
14member or participant, except for a participant under Article
1515, may irrevocably elect the benefits under Section 1-160 and
16the benefits otherwise applicable to that member or
17participant. The election must be made within 30 days after
18becoming a member or participant. Each retirement system shall
19establish procedures for making this election.
20    (c) A participant under Article 15 may irrevocably elect
21the benefits otherwise provided to a Tier 2 participant under
22Article 15. The election must be made within 30 days after
23becoming a participant. The retirement system under Article 15
24shall establish procedures for making this election.
25    (d) "Final average salary" means the average monthly (or
26annual) salary obtained by dividing the total salary or

 

 

10000SB0016sam001- 58 -LRB100 05169 RPS 22680 a

1earnings calculated under the Article applicable to the member
2or participant during the last 120 months (or 10 years) of
3service in which the total salary or earnings calculated under
4the applicable Article was the highest by the number of months
5(or years) of service in that period. For the purposes of a
6person who first becomes a member or participant of any
7retirement system to which this Section applies on or after 6
8months after the effective date of this amendatory Act of the
9100th General Assembly, in this Code, "final average salary"
10shall be substituted for "final average compensation" in
11Article 14.
12    (e) Beginning 6 months after the effective date of this
13amendatory Act of the 100th General Assembly, for all purposes
14under this Code (including without limitation the calculation
15of benefits and employee contributions), the annual earnings,
16salary, or wages (based on the plan year) of a member or
17participant to whom this Section applies shall not at any time
18exceed the federal Social Security Wage Base then in effect.
19    (f) A member or participant is entitled to a retirement
20annuity upon written application if he or she has attained the
21normal retirement age determined by the Social Security
22Administration for that member or participant's year of birth,
23but no earlier than 67 years of age, and has at least 10 years
24of service credit and is otherwise eligible under the
25requirements of the applicable Article.
26    (g) The amount of the retirement annuity to which a member

 

 

10000SB0016sam001- 59 -LRB100 05169 RPS 22680 a

1or participant is entitled shall be computed by multiplying
21.25% for each year of service credit by his or her final
3average salary.
4    (h) Any retirement annuity or supplemental annuity shall be
5subject to annual increases on the first anniversary of the
6annuity start date. Each annual increase shall be one-half the
7annual unadjusted percentage increase (but not less than zero)
8in the consumer price index-w for the 12 months ending with the
9September preceding each November 1 of the originally granted
10retirement annuity. If the annual unadjusted percentage change
11in the consumer price index-w for the 12 months ending with the
12September preceding each November 1 is zero or there is a
13decrease, then the annuity shall not be increased.
14    For the purposes of this Section, "consumer price index-w"
15means the index published by the Bureau of Labor Statistics of
16the United States Department of Labor that measures the average
17change in prices of goods and services purchased by Urban Wage
18Earners and Clerical Workers, United States city average, all
19items, 1982-84 = 100. The new amount resulting from each annual
20adjustment shall be determined by the Public Pension Division
21of the Department of Insurance and made available to the boards
22of the retirement systems and pension funds by November 1 of
23each year.
24    (i) The initial survivor's or widow's annuity of an
25otherwise eligible survivor or widow of a retired member or
26participant who first became a member or participant on or

 

 

10000SB0016sam001- 60 -LRB100 05169 RPS 22680 a

1after 6 months after the effective date of this amendatory Act
2of the 100th General Assembly shall be in the amount of 66 2/3%
3of the retired member's or participant's retirement annuity at
4the date of death. In the case of the death of a member or
5participant who has not retired and who first became a member
6or participant on or after 6 months after the effective date of
7this amendatory Act of the 100th General Assembly, eligibility
8for a survivor's or widow's annuity shall be determined by the
9applicable Article of this Code. The benefit shall be 66 2/3%
10of the earned annuity without a reduction due to age. A child's
11annuity of an otherwise eligible child shall be in the amount
12prescribed under each Article if applicable.
13    (j) In lieu of any other employee contributions, except for
14the contribution to the defined contribution plan under
15subsection (k) of this Section, each employee shall contribute
166.2% of his her or salary to the retirement system. However,
17the employee contribution under this subsection shall not
18exceed the amount of the normal cost of the benefits under this
19Section (except for the defined contribution plan under
20subsection (k) of this Section), expressed as a percentage of
21payroll and determined on or before November 1 of each year by
22the board of trustees of the retirement system. If the board of
23trustees of the retirement system determines that the 6.2%
24employee contribution rate exceeds the normal cost of the
25benefits under this Section (except for the defined
26contribution plan under subsection (k) of this Section), then

 

 

10000SB0016sam001- 61 -LRB100 05169 RPS 22680 a

1on or before December 1 of that year, the board of trustees
2shall certify the amount of the normal cost of the benefits
3under this Section (except for the defined contribution plan
4under subsection (k) of this Section), expressed as a
5percentage of payroll, to the State Actuary and the Commission
6on Government Forecasting and Accountability, and the employee
7contribution under this subsection shall be reduced to that
8amount beginning January 1 of the following year. Thereafter,
9if the normal cost of the benefits under this Section (except
10for the defined contribution plan under subsection (k) of this
11Section), expressed as a percentage of payroll and determined
12on or before November 1 of each year by the board of trustees
13of the retirement system, exceeds 6.2% of salary, then on or
14before December 1 of that year, the board of trustees shall
15certify the normal cost to the State Actuary and the Commission
16on Government Forecasting and Accountability, and the employee
17contributions shall revert back to 6.2% of salary beginning
18January 1 of the following year.
19    (k) No later than 5 months after the effective date of this
20amendatory Act of the 100th General Assembly, each retirement
21system under Article 14, 15, or 16 shall prepare and implement
22a defined contribution plan for members or participants who are
23subject to this Section. The defined contribution plan
24developed under this subsection shall be a plan that aggregates
25employer and employee contributions in individual participant
26accounts which, after meeting any other requirements, are used

 

 

10000SB0016sam001- 62 -LRB100 05169 RPS 22680 a

1for payouts after retirement in accordance with this subsection
2and any other applicable laws.
3        (1) Each member or participant shall contribute a
4    minimum of 4% of his or her salary to the defined
5    contribution plan.
6        (2) For each participant in the defined contribution
7    plan who has been employed with the same employer for at
8    least one year, employer contributions shall be paid into
9    that participant's accounts at a rate expressed as a
10    percentage of salary. This rate may be set for individual
11    employees, but shall be no higher than 6% of salary and
12    shall be no lower than 2% of salary.
13        (3) Employer contributions shall vest when those
14    contributions are paid into a member's or participant's
15    account.
16        (4) The defined contribution plan shall provide a
17    variety of options for investments. These options shall
18    include investments handled by the Illinois State Board of
19    Investment as well as private sector investment options.
20        (5) The defined contribution plan shall provide a
21    variety of options for payouts to retirees and their
22    survivors.
23        (6) To the extent authorized under federal law and as
24    authorized by the retirement system, the defined
25    contribution plan shall allow former participants in the
26    plan to transfer or roll over employee and employer

 

 

10000SB0016sam001- 63 -LRB100 05169 RPS 22680 a

1    contributions, and the earnings thereon, into other
2    qualified retirement plans.
3        (7) Each retirement system shall reduce the employee
4    contributions credited to the member's defined
5    contribution plan account by an amount determined by that
6    retirement system to cover the cost of offering the
7    benefits under this subsection and any applicable
8    administrative fees.
9        (8) No person shall begin participating in the defined
10    contribution plan until it has attained qualified plan
11    status and received all necessary approvals from the U.S.
12    Internal Revenue Service.
13    (l) By accepting the benefits under this Section, a member
14or participant acknowledges and consents that benefits once
15earned may not be diminished, but that future benefits may be
16modified, including, but not limited to, changes in the
17retirement age at which a member or participant becomes
18eligible to receive future benefits, changes in the amount of
19the automatic annual increase for those future benefits, or the
20amount of the retirement annuity. Any increase in benefits
21under this Section applicable to persons under Article 15 or 16
22does not apply unless it is approved by resolution or ordinance
23of the governing body of the unit of local government with
24regard to the members or participants under that unit of local
25government.
26    (m) In the case of a conflict between the provisions of

 

 

10000SB0016sam001- 64 -LRB100 05169 RPS 22680 a

1this Section and any other provision of this Code, the
2provisions of this Section shall control.
 
3    (40 ILCS 5/1-162 new)
4    Sec. 1-162. Optional benefits for certain Tier 2 members of
5pension funds under Articles 7, 8, 9, 10, 11, 12, 13, and 17.
6    (a) As used in this Section:
7    "Affected pension fund" means a pension fund established
8under Article 7, 8, 9, 10, 11, 12, 13, or 17 that the governing
9body of the unit of local government has designated as an
10affected pension fund by adoption of a resolution or ordinance.
11    "Resolution or ordinance date" means the date on which the
12governing body of the unit of local government designates a
13pension fund under Article 7, 8, 9, 10, 11, 12, 13, or 17 as an
14affected pension fund by adoption of a resolution or ordinance.
15    (b) Notwithstanding any other provision of this Code to the
16contrary, the provisions of this Section apply to a person who
17first becomes a member or a participant in an affected pension
18fund on or after 6 months after the resolution or ordinance
19date and who does not make the election under subsection (c).
20The provisions of this Section do not apply to a sheriff's law
21enforcement employee under Article 7.
22    (c) In lieu of the benefits provided under this Section, a
23member or participant may irrevocably elect the benefits under
24Section 1-160 and the benefits otherwise applicable to that
25member or participant. The election must be made within 30 days

 

 

10000SB0016sam001- 65 -LRB100 05169 RPS 22680 a

1after becoming a member or participant. Each affected pension
2fund shall establish procedures for making this election.
3    (d) "Final average salary" means the average monthly (or
4annual) salary obtained by dividing the total salary or
5earnings calculated under the Article applicable to the member
6or participant during the last 120 months (or 10 years) of
7service in which the total salary or earnings calculated under
8the applicable Article was the highest by the number of months
9(or years) of service in that period. For the purposes of a
10person who first becomes a member or participant of an affected
11pension fund on or after 6 months after the ordinance or
12resolution date, in this Code, "final average salary" shall be
13substituted for the following:
14        (1) In Article 7, (except for service as sheriff's law
15    enforcement employees), "final rate of earnings".
16        (2) In Articles 8, 9, 10, 11, and 12, "highest average
17    annual salary for any 4 consecutive years within the last
18    10 years of service immediately preceding the date of
19    withdrawal".
20        (3) In Article 13, "average final salary".
21        (4) In Article 17, "average salary".
22    (e) Beginning 6 months after the resolution or ordinance
23date, for all purposes under this Code (including without
24limitation the calculation of benefits and employee
25contributions), the annual earnings, salary, or wages (based on
26the plan year) of a member or participant to whom this Section

 

 

10000SB0016sam001- 66 -LRB100 05169 RPS 22680 a

1applies shall not at any time exceed the federal Social
2Security Wage Base then in effect.
3    (f) A member or participant is entitled to a retirement
4annuity upon written application if he or she has attained the
5normal retirement age determined by the Social Security
6Administration for that member or participant's year of birth,
7but no earlier than 67 years of age, and has at least 10 years
8of service credit and is otherwise eligible under the
9requirements of the applicable Article.
10    (g) The amount of the retirement annuity to which a member
11or participant is entitled shall be computed by multiplying
121.25% for each year of service credit by his or her final
13average salary.
14    (h) Any retirement annuity or supplemental annuity shall be
15subject to annual increases on the first anniversary of the
16annuity start date. Each annual increase shall be one-half the
17annual unadjusted percentage increase (but not less than zero)
18in the consumer price index-w for the 12 months ending with the
19September preceding each November 1 of the originally granted
20retirement annuity. If the annual unadjusted percentage change
21in the consumer price index-w for the 12 months ending with the
22September preceding each November 1 is zero or there is a
23decrease, then the annuity shall not be increased.
24    For the purposes of this Section, "consumer price index-w"
25means the index published by the Bureau of Labor Statistics of
26the United States Department of Labor that measures the average

 

 

10000SB0016sam001- 67 -LRB100 05169 RPS 22680 a

1change in prices of goods and services purchased by Urban Wage
2Earners and Clerical Workers, United States city average, all
3items, 1982-84 = 100. The new amount resulting from each annual
4adjustment shall be determined by the Public Pension Division
5of the Department of Insurance and made available to the boards
6of the retirement systems and pension funds by November 1 of
7each year.
8    (i) The initial survivor's or widow's annuity of an
9otherwise eligible survivor or widow of a retired member or
10participant who first became a member or participant on or
11after 6 months after the resolution or ordinance date shall be
12in the amount of 66 2/3% of the retired member's or
13participant's retirement annuity at the date of death. In the
14case of the death of a member or participant who has not
15retired and who first became a member or participant on or
16after 6 months after the resolution or ordinance date,
17eligibility for a survivor's or widow's annuity shall be
18determined by the applicable Article of this Code. The benefit
19shall be 66 2/3% of the earned annuity without a reduction due
20to age. A child's annuity of an otherwise eligible child shall
21be in the amount prescribed under each Article if applicable.
22    (j) In lieu of any other employee contributions, except for
23the contribution to the defined contribution plan under
24subsection (k) of this Section, each employee shall contribute
256.2% of his her or salary to the affected pension fund.
26However, the employee contribution under this subsection shall

 

 

10000SB0016sam001- 68 -LRB100 05169 RPS 22680 a

1not exceed the amount of the normal cost of the benefits under
2this Section (except for the defined contribution plan under
3subsection (k) of this Section), expressed as a percentage of
4payroll and determined on or before November 1 of each year by
5the board of trustees of the affected pension fund. If the
6board of trustees of the affected pension fund determines that
7the 6.2% employee contribution rate exceeds the normal cost of
8the benefits under this Section (except for the defined
9contribution plan under subsection (k) of this Section), then
10on or before December 1 of that year, the board of trustees
11shall certify the amount of the normal cost of the benefits
12under this Section (except for the defined contribution plan
13under subsection (k) of this Section), expressed as a
14percentage of payroll, to the State Actuary and the Commission
15on Government Forecasting and Accountability, and the employee
16contribution under this subsection shall be reduced to that
17amount beginning January 1 of the following year. Thereafter,
18if the normal cost of the benefits under this Section (except
19for the defined contribution plan under subsection (k) of this
20Section), expressed as a percentage of payroll and determined
21on or before November 1 of each year by the board of trustees
22of the affected pension fund, exceeds 6.2% of salary, then on
23or before December 1 of that year, the board of trustees shall
24certify the normal cost to the State Actuary and the Commission
25on Government Forecasting and Accountability, and the employee
26contributions shall revert back to 6.2% of salary beginning

 

 

10000SB0016sam001- 69 -LRB100 05169 RPS 22680 a

1January 1 of the following year.
2    (k) No later than 5 months after the resolution or
3ordinance date, an affected pension fund shall prepare and
4implement a defined contribution plan for members or
5participants who are subject to this Section. The defined
6contribution plan developed under this subsection shall be a
7plan that aggregates employer and employee contributions in
8individual participant accounts which, after meeting any other
9requirements, are used for payouts after retirement in
10accordance with this subsection and any other applicable laws.
11        (1) Each member or participant shall contribute a
12    minimum of 4% of his or her salary to the defined
13    contribution plan.
14        (2) For each participant in the defined contribution
15    plan who has been employed with the same employer for at
16    least one year, employer contributions shall be paid into
17    that participant's accounts at a rate expressed as a
18    percentage of salary. This rate may be set for individual
19    employees, but shall be no higher than 6% of salary and
20    shall be no lower than 2% of salary.
21        (3) Employer contributions shall vest when those
22    contributions are paid into a member's or participant's
23    account.
24        (4) The defined contribution plan shall provide a
25    variety of options for investments. These options shall
26    include investments handled by the Illinois State Board of

 

 

10000SB0016sam001- 70 -LRB100 05169 RPS 22680 a

1    Investment as well as private sector investment options.
2        (5) The defined contribution plan shall provide a
3    variety of options for payouts to retirees and their
4    survivors.
5        (6) To the extent authorized under federal law and as
6    authorized by the affected pension fund, the defined
7    contribution plan shall allow former participants in the
8    plan to transfer or roll over employee and employer
9    contributions, and the earnings thereon, into other
10    qualified retirement plans.
11        (7) Each affected pension fund shall reduce the
12    employee contributions credited to the member's defined
13    contribution plan account by an amount determined by that
14    affected pension fund to cover the cost of offering the
15    benefits under this subsection and any applicable
16    administrative fees.
17        (8) No person shall begin participating in the defined
18    contribution plan until it has attained qualified plan
19    status and received all necessary approvals from the U.S.
20    Internal Revenue Service.
21    (l) By accepting the benefits under this Section, a member
22or participant acknowledges and consents that benefits once
23earned may not be diminished, but that future benefits may be
24modified, including, but not limited to, changes in the
25retirement age at which a member or participant becomes
26eligible to receive future benefits, changes in the amount of

 

 

10000SB0016sam001- 71 -LRB100 05169 RPS 22680 a

1the automatic annual increase for those future benefits, or the
2amount of the retirement annuity. Any increase in benefits
3under this Section does not apply unless it is approved by
4resolution or ordinance of the governing body of the unit of
5local government with regard to the members or participants
6under that unit of local government.
7    (m) In the case of a conflict between the provisions of
8this Section and any other provision of this Code, the
9provisions of this Section shall control.
 
10    (40 ILCS 5/2-101)  (from Ch. 108 1/2, par. 2-101)
11    Sec. 2-101. Creation of system. A retirement system is
12created to provide retirement annuities, survivor's annuities
13and other benefits for certain members of the General Assembly,
14certain elected state officials, and their beneficiaries.
15    The system shall be known as the "General Assembly
16Retirement System". All its funds and property shall be a trust
17separate from all other entities, maintained for the purpose of
18securing payment of annuities and benefits under this Article.
19    Participation in the retirement system created under this
20Article is restricted to persons who became participants before
21the effective date of this amendatory Act of the 100th General
22Assembly. Beginning on that date, the System shall not accept
23any new participants.
24(Source: P.A. 83-1440.)
 

 

 

10000SB0016sam001- 72 -LRB100 05169 RPS 22680 a

1    (40 ILCS 5/2-105)  (from Ch. 108 1/2, par. 2-105)
2    Sec. 2-105. Member. "Member": Members of the General
3Assembly of this State, including persons who enter military
4service while a member of the General Assembly, and any person
5serving as Governor, Lieutenant Governor, Secretary of State,
6Treasurer, Comptroller, or Attorney General for the period of
7service in such office.
8    Any person who has served for 10 or more years as Clerk or
9Assistant Clerk of the House of Representatives, Secretary or
10Assistant Secretary of the Senate, or any combination thereof,
11may elect to become a member of this system while thenceforth
12engaged in such service by filing a written election with the
13board. Any person so electing shall be deemed an active member
14of the General Assembly for the purpose of validating and
15transferring any service credits earned under any of the funds
16and systems established under Articles 3 through 18 of this
17Code.
18    However, notwithstanding any other provision of this
19Article, a person shall not be deemed a member for the purposes
20of this Article unless he or she became a participant of the
21System before the effective date of this amendatory Act of the
22100th General Assembly.
23(Source: P.A. 85-1008.)
 
24    (40 ILCS 5/2-105.3 new)
25    Sec. 2-105.3. Tier 1 employee. "Tier 1 employee": A

 

 

10000SB0016sam001- 73 -LRB100 05169 RPS 22680 a

1participant who first became a participant before January 1,
22011.
 
3    (40 ILCS 5/2-107)  (from Ch. 108 1/2, par. 2-107)
4    Sec. 2-107. Participant. "Participant": Any member who
5elects to participate; and any former member who elects to
6continue participation under Section 2-117.1, for the duration
7of such continued participation. However, notwithstanding any
8other provision of this Article, a person shall not be deemed a
9participant for the purposes of this Article unless he or she
10became a participant of the System before the effective date of
11this amendatory Act of the 100th General Assembly.
12(Source: P.A. 86-1488.)
 
13    (40 ILCS 5/2-107.9 new)
14    Sec. 2-107.9. Future increase in income. "Future increase
15in income" means an increase to a Tier 1 employee's base pay
16that is offered to the Tier 1 employee for service under this
17Article after June 30, 2018 that qualifies as "salary", as
18defined in Section 2-108, or would qualify as "salary" but for
19the fact that it was offered to and accepted by the Tier 1
20employee under the condition set forth in subsection (c) of
21Section 2-110.3.
 
22    (40 ILCS 5/2-107.10 new)
23    Sec. 2-107.10. Base pay. As used in Section 2-107.9 of

 

 

10000SB0016sam001- 74 -LRB100 05169 RPS 22680 a

1this Code, "base pay" means the Tier 1 employee's annualized
2rate of salary as of June 30, 2018. For a person returning to
3active service as a Tier 1 employee after June 30, 2018,
4however, "base pay" means the employee's annualized rate of
5salary as of the employee's last date of service prior to July
61, 2018. The System shall calculate the base pay of each Tier 1
7employee pursuant to this Section.
 
8    (40 ILCS 5/2-108)  (from Ch. 108 1/2, par. 2-108)
9    (Text of Section WITHOUT the changes made by P.A. 98-599,
10which has been held unconstitutional)
11    Sec. 2-108. Salary. "Salary":
12    (1) For members of the General Assembly, the total
13compensation paid to the member by the State for one year of
14service, including the additional amounts, if any, paid to the
15member as an officer pursuant to Section 1 of "An Act in
16relation to the compensation and emoluments of the members of
17the General Assembly", approved December 6, 1907, as now or
18hereafter amended.
19    (2) For the State executive officers specified in Section
202-105, the total compensation paid to the member for one year
21of service.
22    (3) For members of the System who are participants under
23Section 2-117.1, or who are serving as Clerk or Assistant Clerk
24of the House of Representatives or Secretary or Assistant
25Secretary of the Senate, the total compensation paid to the

 

 

10000SB0016sam001- 75 -LRB100 05169 RPS 22680 a

1member for one year of service, but not to exceed the salary of
2the highest salaried officer of the General Assembly.
3    However, in the event that federal law results in any
4participant receiving imputed income based on the value of
5group term life insurance provided by the State, such imputed
6income shall not be included in salary for the purposes of this
7Article.
8    Notwithstanding any other provision of this Section,
9"salary" does not include any future increase in income that is
10offered for service to a Tier 1 employee under this Article
11pursuant to the condition set forth in subsection (c) of
12Section 2-110.3 and accepted under that condition by a Tier 1
13employee who has made the election under paragraph (2) of
14subsection (a) of Section 2-110.3.
15    Notwithstanding any other provision of this Section,
16"salary" does not include any consideration payment made to a
17Tier 1 employee.
18(Source: P.A. 86-27; 86-273; 86-1028; 86-1488.)
 
19    (40 ILCS 5/2-110.3 new)
20    Sec. 2-110.3. 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
25    provided in subsection (a-1) of Section 2-119.1 and to have

 

 

10000SB0016sam001- 76 -LRB100 05169 RPS 22680 a

1    the amount of the automatic annual increases in his or her
2    retirement annuity and survivor's annuity that are
3    otherwise provided for in this Article calculated,
4    instead, as provided in subsection (a-1) of Section
5    2-119.1; or
6        (2) to not agree to paragraph (1) of this subsection.
7    The election required under this subsection (a) shall be
8made by each active Tier 1 employee no earlier than January 1,
92018 and no later than March 31, 2018, except that a person who
10returns to active service as a Tier 1 employee under this
11Article on or after January 1, 2018 and has not yet made an
12election under this Section must make the election under this
13subsection (a) within 60 days after returning to active service
14as a Tier 1 employee.
15    If a Tier 1 employee fails for any reason to make a
16required election under this subsection within the time
17specified, then the employee shall be deemed to have made the
18election under paragraph (2) of this subsection.
19    (a-5) If this Section is enjoined or stayed by an Illinois
20court or a court of competent jurisdiction pending the entry of
21a final and unappealable decision, and this Section is
22determined to be constitutional or otherwise valid by a final
23unappealable decision of an Illinois court or a court of
24competent jurisdiction, then the election procedure set forth
25in subsection (a) of this Section shall commence on the 180th
26calendar day after the date of the issuance of the final

 

 

10000SB0016sam001- 77 -LRB100 05169 RPS 22680 a

1unappealable decision and shall conclude at the end of the
2270th calendar day after that date.
3    (a-10) All elections under subsection (a) that are made or
4deemed to be made before July 1, 2018 shall take effect on July
51, 2018. Elections that are made or deemed to be made on or
6after July 1, 2018 shall take effect on the first day of the
7month following the month in which the election is made or
8deemed to be made.
9    (b) As adequate and legal consideration provided under this
10amendatory Act of the 100th General Assembly for making an
11election under paragraph (1) of subsection (a) of this Section,
12the State of Illinois shall be expressly and irrevocably
13prohibited from offering any future increases in income to a
14Tier 1 employee who has made an election under paragraph (1) of
15subsection (a) of this Section on the condition of not
16constituting salary under Section 2-108.
17    As adequate and legal consideration provided under this
18amendatory Act of the 100th General Assembly for making an
19election under paragraph (1) of subsection (a) of this Section,
20each Tier 1 employee who has made an election under paragraph
21(1) of subsection (a) of this Section shall receive a
22consideration payment equal to 10% of the contributions made by
23or on behalf of the employee under Section 2-126 before the
24effective date of that election. The State Comptroller shall
25pay the consideration payment to the Tier 1 employee out of
26funds appropriated for that purpose under Section 1.9 of the

 

 

10000SB0016sam001- 78 -LRB100 05169 RPS 22680 a

1State Pension Funds Continuing Appropriation Act. The System
2shall calculate the amount of each consideration payment and,
3by July 1, 2018, shall certify to the State Comptroller the
4amount of the consideration payment, together with the name,
5address, and any other available payment information of the
6Tier 1 employee as found in the records of the System. The
7System shall make additional calculations and certifications
8of consideration payments to the State Comptroller as the
9System deems necessary.
10    (c) A Tier 1 employee who makes the election under
11paragraph (2) of subsection (a) of this Section shall not be
12subject to paragraph (1) of subsection (a) of this Section.
13However, each future increase in income offered for service as
14a member under this Article to a Tier 1 employee who has made
15the election under paragraph (2) of subsection (a) of this
16Section shall be offered expressly and irrevocably on the
17condition of not constituting salary under Section 2-108 and
18that the Tier 1 employee's acceptance of the offered future
19increase in income shall constitute his or her agreement to
20that condition.
21    (d) The System shall make a good faith effort to contact
22each Tier 1 employee subject to this Section. The System shall
23mail information describing the required election to each Tier
241 employee by United States Postal Service mail to his or her
25last known address on file with the System. If the Tier 1
26employee is not responsive to other means of contact, it is

 

 

10000SB0016sam001- 79 -LRB100 05169 RPS 22680 a

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

 

 

10000SB0016sam001- 80 -LRB100 05169 RPS 22680 a

1elections under this Section. The System shall coordinate with
2the Illinois Department of Central Management Services and each
3other retirement system administering an election in
4accordance with this amendatory Act of the 100th General
5Assembly to provide information concerning the impact of the
6election set forth in this Section.
7    (e) Notwithstanding any other provision of law, each future
8increase in income offered by the State of Illinois for service
9as a member must be offered expressly and irrevocably on the
10condition of not constituting "salary" under Section 2-108 to
11any Tier 1 employee who has made an election under paragraph
12(2) of subsection (a) of this Section. The offer shall also
13provide that the Tier 1 employee's acceptance of the offered
14future increase in income shall constitute his or her agreement
15to the condition set forth in this subsection.
16    For purposes of legislative intent, the condition set forth
17in this subsection shall be construed in a manner that ensures
18that the condition is not violated or circumvented through any
19contrivance of any kind.
20    (f) A member's election under this Section is not a
21prohibited election under subdivision (j)(1) of Section 1-119
22of this Code.
23    (g) No provision of this Section shall be interpreted in a
24way that would cause the System to cease to be a qualified plan
25under Section 401(a) of the Internal Revenue Code of 1986. The
26provisions of this Section shall be subject to and implemented

 

 

10000SB0016sam001- 81 -LRB100 05169 RPS 22680 a

1in a manner that complies with Section 11 of Article IV of the
2Illinois Constitution.
3    (h) If an election created by this amendatory Act in any
4other Article of this Code or any change deriving from that
5election is determined to be unconstitutional or otherwise
6invalid by a final unappealable decision of an Illinois court
7or a court of competent jurisdiction, the invalidity of that
8provision shall not in any way affect the validity of this
9Section or the changes deriving from the election required
10under this Section.
 
11    (40 ILCS 5/2-119.1)  (from Ch. 108 1/2, par. 2-119.1)
12    (Text of Section WITHOUT the changes made by P.A. 98-599,
13which has been held unconstitutional)
14    Sec. 2-119.1. Automatic increase in retirement annuity.
15    (a) Except as provided in subsection (a-1), a A participant
16who retires after June 30, 1967, and who has not received an
17initial increase under this Section before the effective date
18of this amendatory Act of 1991, shall, in January or July next
19following the first anniversary of retirement, whichever
20occurs first, and in the same month of each year thereafter,
21but in no event prior to age 60, have the amount of the
22originally granted retirement annuity increased as follows:
23for each year through 1971, 1 1/2%; for each year from 1972
24through 1979, 2%; and for 1980 and each year thereafter, 3%.
25Annuitants who have received an initial increase under this

 

 

10000SB0016sam001- 82 -LRB100 05169 RPS 22680 a

1subsection prior to the effective date of this amendatory Act
2of 1991 shall continue to receive their annual increases in the
3same month as the initial increase.
4    (a-1) Notwithstanding any other provision of this Article,
5for a Tier 1 employee who made the election under paragraph (1)
6of subsection (a) of Section 2-110.3:
7        (1) The initial increase in retirement annuity under
8    this Section shall occur on the January 1 occurring either
9    on or after the attainment of age 67 or the fifth
10    anniversary of the annuity start date, whichever is
11    earlier.
12        (2) The amount of each automatic annual increase in
13    retirement annuity or survivor's annuity occurring on or
14    after the effective date of that election shall be
15    calculated as a percentage of the originally granted
16    retirement annuity or survivor's annuity, equal to 3% or
17    one-half the annual unadjusted percentage increase (but
18    not less than zero) in the consumer price index-u for the
19    12 months ending with the September preceding each November
20    1, whichever is less. If the annual unadjusted percentage
21    change in the consumer price index-u for the 12 months
22    ending with the September preceding each November 1 is zero
23    or there is a decrease, then the annuity shall not be
24    increased.
25    For the purposes of this Section, "consumer price index-u"
26means the index published by the Bureau of Labor Statistics of

 

 

10000SB0016sam001- 83 -LRB100 05169 RPS 22680 a

1the United States Department of Labor that measures the average
2change in prices of goods and services purchased by all urban
3consumers, United States city average, all items, 1982-84 =
4100. The new amount resulting from each annual adjustment shall
5be determined by the Public Pension Division of the Department
6of Insurance and made available to the board of the retirement
7system by November 1 of each year.
8    (b) Beginning January 1, 1990, for eligible participants
9who remain in service after attaining 20 years of creditable
10service, the 3% increases provided under subsection (a) shall
11begin to accrue on the January 1 next following the date upon
12which the participant (1) attains age 55, or (2) attains 20
13years of creditable service, whichever occurs later, and shall
14continue to accrue while the participant remains in service;
15such increases shall become payable on January 1 or July 1,
16whichever occurs first, next following the first anniversary of
17retirement. For any person who has service credit in the System
18for the entire period from January 15, 1969 through December
1931, 1992, regardless of the date of termination of service, the
20reference to age 55 in clause (1) of this subsection (b) shall
21be deemed to mean age 50.
22    This subsection (b) does not apply to any person who first
23becomes a member of the System after August 8, 2003 (the
24effective date of Public Act 93-494) this amendatory Act of the
2593rd General Assembly.
26    (b-5) Notwithstanding any other provision of this Article,

 

 

10000SB0016sam001- 84 -LRB100 05169 RPS 22680 a

1a participant who first becomes a participant on or after
2January 1, 2011 (the effective date of Public Act 96-889)
3shall, in January or July next following the first anniversary
4of retirement, whichever occurs first, and in the same month of
5each year thereafter, but in no event prior to age 67, have the
6amount of the retirement annuity then being paid increased by
73% or the annual unadjusted percentage increase in the Consumer
8Price Index for All Urban Consumers as determined by the Public
9Pension Division of the Department of Insurance under
10subsection (a) of Section 2-108.1, whichever is less.
11    (c) The foregoing provisions relating to automatic
12increases are not applicable to a participant who retires
13before having made contributions (at the rate prescribed in
14Section 2-126) for automatic increases for less than the
15equivalent of one full year. However, in order to be eligible
16for the automatic increases, such a participant may make
17arrangements to pay to the system the amount required to bring
18the total contributions for the automatic increase to the
19equivalent of one year's contributions based upon his or her
20last salary.
21    (d) A participant who terminated service prior to July 1,
221967, with at least 14 years of service is entitled to an
23increase in retirement annuity beginning January, 1976, and to
24additional increases in January of each year thereafter.
25    The initial increase shall be 1 1/2% of the originally
26granted retirement annuity multiplied by the number of full

 

 

10000SB0016sam001- 85 -LRB100 05169 RPS 22680 a

1years that the annuitant was in receipt of such annuity prior
2to January 1, 1972, plus 2% of the originally granted
3retirement annuity for each year after that date. The
4subsequent annual increases shall be at the rate of 2% of the
5originally granted retirement annuity for each year through
61979 and at the rate of 3% for 1980 and thereafter.
7    (e) Beginning January 1, 1990, and except as provided in
8subsection (a-1), all automatic annual increases payable under
9this Section shall be calculated as a percentage of the total
10annuity payable at the time of the increase, including previous
11increases granted under this Article.
12(Source: P.A. 96-889, eff. 1-1-11; 96-1490, eff. 1-1-11.)
 
13    (40 ILCS 5/2-124)  (from Ch. 108 1/2, par. 2-124)
14    (Text of Section WITHOUT the changes made by P.A. 98-599,
15which has been held unconstitutional)
16    Sec. 2-124. Contributions by State.
17    (a) The State shall make contributions to the System by
18appropriations of amounts which, together with the
19contributions of participants, interest earned on investments,
20and other income will meet the cost of maintaining and
21administering the System on a 90% funded basis in accordance
22with actuarial recommendations.
23    (b) The Board shall determine the amount of State
24contributions required for each fiscal year on the basis of the
25actuarial tables and other assumptions adopted by the Board and

 

 

10000SB0016sam001- 86 -LRB100 05169 RPS 22680 a

1the prescribed rate of interest, using the formula in
2subsection (c).
3    (c) For State fiscal years 2018 through 2045 (except as
4otherwise provided for fiscal year 2019), the minimum
5contribution to the System to be made by the State for each
6fiscal year shall be an amount determined by the System to be
7sufficient to bring the total assets of the System up to 90% of
8the total actuarial liabilities of the System by the end of
9State fiscal year 2045. In making these determinations, the
10required State contribution shall be calculated each year as a
11level percentage of total payroll, including payroll that is
12not deemed pensionable, but excluding payroll attributable to
13participants in the defined contribution plan under Section
142-165.1, over the years remaining to and including fiscal year
152045 and shall be determined under the projected unit credit
16actuarial cost method.
17    For State fiscal year 2019:
18        (1) The initial calculation and certification shall be
19    based on the amount determined above.
20        (2) For purposes of the recertification due on or
21    before May 1, 2018, the recalculation of the required State
22    contribution for fiscal year 2019 shall take into account
23    the effect on the System's liabilities of the elections
24    made under Section 2-110.3.
25        (3) For purposes of the recertification due on or
26    before October 1, 2018, the total required State

 

 

10000SB0016sam001- 87 -LRB100 05169 RPS 22680 a

1    contribution for fiscal year 2019 shall be reduced by the
2    amount of the consideration payments made to Tier 1
3    employees who made the election under paragraph (1) of
4    subsection (a) of Section 2-110.3.
5    Beginning in State fiscal year 2018, any increase or
6decrease in State contribution over the prior fiscal year due
7exclusively to changes in actuarial or investment assumptions
8adopted by the Board shall be included in the State
9contribution to the System, as a percentage of the applicable
10employee payroll, and shall be increased in equal annual
11increments so that by the State fiscal year occurring 5 years
12after the adoption of the actuarial or investment assumptions,
13the State is contributing at the rate otherwise required under
14this Section.
15    If Section 2-110.3 is determined to be unconstitutional or
16otherwise invalid by a final unappealable decision of an
17Illinois court or a court of competent jurisdiction, then the
18changes made to this Section by this amendatory Act of the
19100th General Assembly shall not take effect and are repealed
20by operation of law.
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

 

 

10000SB0016sam001- 88 -LRB100 05169 RPS 22680 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$4,157,000.
13    Notwithstanding any other provision of this Article, the
14total required State contribution for State fiscal year 2007 is
15$5,220,300.
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$10,454,000 and shall be made from the proceeds of bonds sold
25in fiscal year 2010 pursuant to Section 7.2 of the General
26Obligation Bond Act, less (i) the pro rata share of bond sale

 

 

10000SB0016sam001- 89 -LRB100 05169 RPS 22680 a

1expenses determined by the System's share of total bond
2proceeds, (ii) any amounts received from the General Revenue
3Fund in fiscal year 2010, and (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 2-134 and shall be made from the proceeds
10of bonds sold in fiscal year 2011 pursuant to Section 7.2 of
11the General Obligation Bond Act, less (i) the pro rata share of
12bond sale expenses determined by the System's share of total
13bond proceeds, (ii) any amounts received from the General
14Revenue Fund in fiscal year 2011, and (iii) any reduction in
15bond proceeds due to the issuance of discounted bonds, if
16applicable.
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

 

 

10000SB0016sam001- 90 -LRB100 05169 RPS 22680 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 2-134, shall not
11exceed an amount equal to (i) the amount of the required State
12contribution that would have been calculated under this Section
13for 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

 

 

10000SB0016sam001- 91 -LRB100 05169 RPS 22680 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    (d) For purposes of determining the required State
7contribution to the System, the value of the System's assets
8shall be equal to the actuarial value of the System's assets,
9which shall be calculated as follows:
10    As of June 30, 2008, the actuarial value of the System's
11assets shall be equal to the market value of the assets as of
12that date. In determining the actuarial value of the System's
13assets for fiscal years after June 30, 2008, any actuarial
14gains or losses from investment return incurred in a fiscal
15year shall be recognized in equal annual amounts over the
165-year period following that fiscal year.
17    (e) For purposes of determining the required State
18contribution to the system for a particular year, the actuarial
19value of assets shall be assumed to earn a rate of return equal
20to the system's actuarially assumed rate of return.
21(Source: P.A. 96-43, eff. 7-15-09; 96-1497, eff. 1-14-11;
2296-1511, eff. 1-27-11; 96-1554, eff. 3-18-11; 97-813, eff.
237-13-12.)
 
24    (40 ILCS 5/2-126)  (from Ch. 108 1/2, par. 2-126)
25    (Text of Section WITHOUT the changes made by P.A. 98-599,

 

 

10000SB0016sam001- 92 -LRB100 05169 RPS 22680 a

1which has been held unconstitutional)
2    Sec. 2-126. Contributions by participants.
3    (a) Each participant shall contribute toward the cost of
4his or her retirement annuity a percentage of each payment of
5salary received by him or her for service as a member as
6follows: for service between October 31, 1947 and January 1,
71959, 5%; for service between January 1, 1959 and June 30,
81969, 6%; for service between July 1, 1969 and January 10,
91973, 6 1/2%; for service after January 10, 1973, 7%; for
10service after December 31, 1981, 8 1/2%.
11    (b) Beginning August 2, 1949, each male participant, and
12from July 1, 1971, each female participant shall contribute
13towards the cost of the survivor's annuity 2% of salary.
14    A participant who has no eligible survivor's annuity
15beneficiary may elect to cease making contributions for
16survivor's annuity under this subsection. A survivor's annuity
17shall not be payable upon the death of a person who has made
18this election, unless prior to that death the election has been
19revoked and the amount of the contributions that would have
20been paid under this subsection in the absence of the election
21is paid to the System, together with interest at the rate of 4%
22per year from the date the contributions would have been made
23to the date of payment.
24    (c) Beginning July 1, 1967, each participant shall
25contribute 1% of salary towards the cost of automatic increase
26in annuity provided in Section 2-119.1. These contributions

 

 

10000SB0016sam001- 93 -LRB100 05169 RPS 22680 a

1shall be made concurrently with contributions for retirement
2annuity purposes.
3    (d) In addition, each participant serving as an officer of
4the General Assembly shall contribute, for the same purposes
5and at the same rates as are required of a regular participant,
6on each additional payment received as an officer. If the
7participant serves as an officer for at least 2 but less than 4
8years, he or she shall contribute an amount equal to the amount
9that would have been contributed had the participant served as
10an officer for 4 years. Persons who serve as officers in the
1187th General Assembly but cannot receive the additional payment
12to officers because of the ban on increases in salary during
13their terms may nonetheless make contributions based on those
14additional payments for the purpose of having the additional
15payments included in their highest salary for annuity purposes;
16however, persons electing to make these additional
17contributions must also pay an amount representing the
18corresponding employer contributions, as calculated by the
19System.
20    (e) Notwithstanding any other provision of this Article,
21the required contribution of a participant who first becomes a
22participant on or after January 1, 2011 shall not exceed the
23contribution that would be due under this Article if that
24participant's highest salary for annuity purposes were
25$106,800, plus any increases in that amount under Section
262-108.1.

 

 

10000SB0016sam001- 94 -LRB100 05169 RPS 22680 a

1    (f) Beginning July 1, 2018 or the effective date of the
2Tier 1 employee's election under paragraph (1) of subsection
3(a) of Section 2-110.3, whichever is later, in lieu of the
4contributions otherwise required under this Section, each Tier
51 employee who made the election under paragraph (1) of
6subsection (a) of Section 2-110.3 shall contribute 8.5% of each
7payment of salary toward the cost of his or her retirement
8annuity and 1.85% of each payment of salary toward the cost of
9the survivor's annuity.
10    (g) Notwithstanding subsection (f) of this Section,
11beginning July 1, 2018 or the effective date of the Tier 1
12employee's election under paragraph (1) of subsection (a) of
13Section 2-110.3, whichever is later, in lieu of the
14contributions otherwise required under this Section, each Tier
151 employee who made the election under paragraph (1) of
16subsection (a) of Section 2-110.3 and has elected to cease
17making contributions for survivor's annuity under subsection
18(b) of this Section, shall contribute 8.55% of each payment of
19salary toward the cost of his or her retirement annuity.
20(Source: P.A. 96-1490, eff. 1-1-11.)
 
21    (40 ILCS 5/2-134)   (from Ch. 108 1/2, par. 2-134)
22    (Text of Section WITHOUT the changes made by P.A. 98-599,
23which has been held unconstitutional)
24    Sec. 2-134. To certify required State contributions and
25submit vouchers.

 

 

10000SB0016sam001- 95 -LRB100 05169 RPS 22680 a

1    (a) The Board shall certify to the Governor on or before
2December 15 of each year until December 15, 2011 the amount of
3the required State contribution to the System for the next
4fiscal year and shall specifically identify the System's
5projected State normal cost for that fiscal year. The
6certification shall include a copy of the actuarial
7recommendations upon which it is based and shall specifically
8identify the System's projected State normal cost for that
9fiscal year.
10    On or before November 1 of each year, beginning November 1,
112012, the Board shall submit to the State Actuary, the
12Governor, and the General Assembly a proposed certification of
13the amount of the required State contribution to the System for
14the 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 every 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

 

 

10000SB0016sam001- 96 -LRB100 05169 RPS 22680 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    On or before May 1, 2004, the Board shall recalculate and
5recertify to the Governor the amount of the required State
6contribution to the System for State fiscal year 2005, taking
7into account the amounts appropriated to and received by the
8System under subsection (d) of Section 7.2 of the General
9Obligation Bond Act.
10    On or before July 1, 2005, the Board shall recalculate and
11recertify to the Governor the amount of the required State
12contribution to the System for State fiscal year 2006, taking
13into account the changes in required State contributions made
14by this amendatory Act of the 94th General Assembly.
15    On or before April 1, 2011, the Board shall recalculate and
16recertify to the Governor the amount of the required State
17contribution to the System for State fiscal year 2011, applying
18the changes made by Public Act 96-889 to the System's assets
19and liabilities as of June 30, 2009 as though Public Act 96-889
20was approved on that date.
21    As soon as practical after the effective date of this
22amendatory Act of the 100th General Assembly, the Board shall
23recalculate and recertify to the State Actuary, the Governor,
24and the General Assembly the amount of the State contribution
25to the System for State fiscal year 2018, taking into account
26the changes in required State contributions made by this

 

 

10000SB0016sam001- 97 -LRB100 05169 RPS 22680 a

1amendatory Act of the 100th General Assembly. The State Actuary
2shall review the assumptions and valuations underlying the
3Board's revised certification and issue a preliminary report
4concerning the proposed recertification and identifying, if
5necessary, recommended changes in actuarial assumptions that
6the Board must consider before finalizing its certification of
7the required State contributions. The Board's final
8certification must note any deviations from the State Actuary's
9recommended changes, the reason or reasons for not following
10the State Actuary's recommended changes, and the fiscal impact
11of not following the State Actuary's recommended changes on the
12required State contribution.
13    On or before May 1, 2018, the Board shall recalculate and
14recertify to the Governor and the General Assembly the amount
15of the required State contribution to the System for State
16fiscal year 2019, taking into account the effect on the
17System's liabilities of the elections made under Section
182-110.3.
19    On or before October 1, 2018, the Board shall recalculate
20and recertify to the Governor and the General Assembly the
21amount of the required State contribution to the System for
22State fiscal year 2019, taking into account the reduction
23specified under item (3) of subsection (c) of Section 2-124.
24    (b) Beginning in State fiscal year 1996, on or as soon as
25possible after the 15th day of each month the Board shall
26submit vouchers for payment of State contributions to the

 

 

10000SB0016sam001- 98 -LRB100 05169 RPS 22680 a

1System, in a total monthly amount of one-twelfth of the
2required annual State contribution certified under subsection
3(a). From the effective date of this amendatory Act of the 93rd
4General Assembly through June 30, 2004, the Board shall not
5submit vouchers for the remainder of fiscal year 2004 in excess
6of the fiscal year 2004 certified contribution amount
7determined under this Section after taking into consideration
8the transfer to the System under subsection (d) of Section
96z-61 of the State Finance Act. These vouchers shall be paid by
10the State Comptroller and Treasurer by warrants drawn on the
11funds appropriated to the System for that fiscal year. If in
12any month the amount remaining unexpended from all other
13appropriations to the System for the applicable fiscal year
14(including the appropriations to the System under Section 8.12
15of the State Finance Act and Section 1 of the State Pension
16Funds Continuing Appropriation Act) is less than the amount
17lawfully vouchered under this Section, the difference shall be
18paid from the General Revenue Fund under the continuing
19appropriation authority provided in Section 1.1 of the State
20Pension Funds Continuing Appropriation Act.
21    (c) The full amount of any annual appropriation for the
22System for State fiscal year 1995 shall be transferred and made
23available to the System at the beginning of that fiscal year at
24the request of the Board. Any excess funds remaining at the end
25of any fiscal year from appropriations shall be retained by the
26System as a general reserve to meet the System's accrued

 

 

10000SB0016sam001- 99 -LRB100 05169 RPS 22680 a

1liabilities.
2(Source: P.A. 96-1497, eff. 1-14-11; 96-1511, eff. 1-27-11;
397-694, eff. 6-18-12.)
 
4    (40 ILCS 5/2-162)
5    (Text of Section WITHOUT the changes made by P.A. 98-599,
6which has been held unconstitutional)
7    Sec. 2-162. Application and expiration of new benefit
8increases.
9    (a) As used in this Section, "new benefit increase" means
10an increase in the amount of any benefit provided under this
11Article, or an expansion of the conditions of eligibility for
12any benefit under this Article, that results from an amendment
13to this Code that takes effect after the effective date of this
14amendatory Act of the 94th General Assembly. "New benefit
15increase", however, does not include any benefit increase
16resulting from the changes made to this Article by this
17amendatory Act of the 100th General Assembly.
18    (b) Notwithstanding any other provision of this Code or any
19subsequent amendment to this Code, every new benefit increase
20is subject to this Section and shall be deemed to be granted
21only in conformance with and contingent upon compliance with
22the provisions of this Section.
23    (c) The Public Act enacting a new benefit increase must
24identify and provide for payment to the System of additional
25funding at least sufficient to fund the resulting annual

 

 

10000SB0016sam001- 100 -LRB100 05169 RPS 22680 a

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

 

 

10000SB0016sam001- 101 -LRB100 05169 RPS 22680 a

1and qualified for the affected benefit while the new benefit
2increase was in effect and to the affected beneficiaries and
3alternate payees of such persons, but does not apply to any
4other person, including without limitation a person who
5continues in service after the expiration date and did not
6apply and qualify for the affected benefit while the new
7benefit increase was in effect.
8(Source: P.A. 94-4, eff. 6-1-05.)
 
9    (40 ILCS 5/2-165.1 new)
10    Sec. 2-165.1. Defined contribution plan.
11    (a) By July 1, 2018, the System shall prepare and implement
12a voluntary defined contribution plan for up to 5% of eligible
13active Tier 1 employees. The System shall determine the 5% cap
14by the number of active Tier 1 employees on the effective date
15of this Section. The defined contribution plan developed under
16this Section shall be a plan that aggregates employer and
17employee contributions in individual participant accounts
18which, after meeting any other requirements, are used for
19payouts after retirement in accordance with this Section and
20any other applicable laws.
21    As used in this Section, "defined benefit plan" means the
22retirement plan available under this Article to Tier 1
23employees who have not made the election authorized under this
24Section.
25        (1) Under the defined contribution plan, an active Tier

 

 

10000SB0016sam001- 102 -LRB100 05169 RPS 22680 a

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

 

 

10000SB0016sam001- 103 -LRB100 05169 RPS 22680 a

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

 

 

10000SB0016sam001- 104 -LRB100 05169 RPS 22680 a

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

 

 

10000SB0016sam001- 105 -LRB100 05169 RPS 22680 a

1projections of the participant's defined benefits at
2retirement or earlier termination of service and the value of
3the participant's account at retirement or earlier termination
4of service. The System shall not provide advice or counseling
5with respect to whether the employee should exercise the
6option. The System shall inform Tier 1 employees who are
7eligible to participate in the defined contribution plan that
8they may also wish to obtain information and counsel relating
9to their option from any other available source, including but
10not limited to labor organizations, private counsel, and
11financial advisors.
12    (e) In no event shall the System, its staff, its authorized
13representatives, or the Board be liable for any information
14given to an employee under this Section. The System may
15coordinate with the Illinois Department of Central Management
16Services and other retirement systems administering a defined
17contribution plan in accordance with this amendatory Act of the
18100th General Assembly to provide information concerning the
19impact of the option set forth in this Section.
20    (f) Notwithstanding any other provision of this Section, no
21person shall begin participating in the defined contribution
22plan until it has attained qualified plan status and received
23all necessary approvals from the U.S. Internal Revenue Service.
24    (g) The System shall report on its progress under this
25Section, including the available details of the defined
26contribution plan and the System's plans for informing eligible

 

 

10000SB0016sam001- 106 -LRB100 05169 RPS 22680 a

1Tier 1 employees about the plan, to the Governor and the
2General Assembly on or before January 15, 2018.
3    (h) The Illinois State Board of Investments shall be the
4plan sponsor for the defined contribution plan established
5under this Section.
6    (i) The intent of this amendatory Act of the 100th General
7Assembly is to ensure that the State's normal cost of
8participation in the defined contribution plan is similar, and
9if possible equal, to the State's normal cost of participation
10in the defined benefit plan, unless a lower State's normal cost
11is necessary to ensure cost neutrality.
12    (j) If Section 2-110.3 is determined to be unconstitutional
13or otherwise invalid by a final unappealable decision of an
14Illinois court or a court of competent jurisdiction, then this
15Section shall not take effect and is repealed by operation of
16law.
 
17    (40 ILCS 5/2-166.1 new)
18    Sec. 2-166.1. Defined contribution plan; termination. If
19the defined contribution plan is terminated or becomes
20inoperative pursuant to law, then each participant in the plan
21shall automatically be deemed to have been a contributing Tier
221 employee in the System's defined benefit plan during the time
23in which he or she participated in the defined contribution
24plan, and for that purpose the System shall be entitled to
25recover the amounts in the participant's defined contribution

 

 

10000SB0016sam001- 107 -LRB100 05169 RPS 22680 a

1accounts.
 
2    (40 ILCS 5/14-103.10)  (from Ch. 108 1/2, par. 14-103.10)
3    (Text of Section WITHOUT the changes made by P.A. 98-599,
4which has been held unconstitutional)
5    Sec. 14-103.10. Compensation.
6    (a) For periods of service prior to January 1, 1978, the
7full rate of salary or wages payable to an employee for
8personal services performed if he worked the full normal
9working period for his position, subject to the following
10maximum amounts: (1) prior to July 1, 1951, $400 per month or
11$4,800 per year; (2) between July 1, 1951 and June 30, 1957
12inclusive, $625 per month or $7,500 per year; (3) beginning
13July 1, 1957, no limitation.
14    In the case of service of an employee in a position
15involving part-time employment, compensation shall be
16determined according to the employees' earnings record.
17    (b) For periods of service on and after January 1, 1978,
18all remuneration for personal services performed defined as
19"wages" under the Social Security Enabling Act, including that
20part of such remuneration which is in excess of any maximum
21limitation provided in such Act, and including any benefits
22received by an employee under a sick pay plan in effect before
23January 1, 1981, but excluding lump sum salary payments:
24        (1) for vacation,
25        (2) for accumulated unused sick leave,

 

 

10000SB0016sam001- 108 -LRB100 05169 RPS 22680 a

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

 

 

10000SB0016sam001- 109 -LRB100 05169 RPS 22680 a

1    (f) Notwithstanding the other provisions of this Section,
2for service on or after July 1, 2013, "compensation" does not
3include any stipend payable to an employee for service on a
4board or commission.
5    (g) Notwithstanding any other provision of this Section,
6"compensation" does not include any future increase in income
7that is offered for service by a department to a Tier 1
8employee under this Article pursuant to the condition set forth
9in subsection (c) of Section 14-106.5 and accepted under that
10condition by a Tier 1 employee who has made the election under
11paragraph (2) of subsection (a) of Section 14-106.5.
12    (h) Notwithstanding any other provision of this Section,
13"compensation" does not include any consideration payment made
14to a Tier 1 employee.
15(Source: P.A. 98-449, eff. 8-16-13.)
 
16    (40 ILCS 5/14-103.41 new)
17    Sec. 14-103.41. Tier 1 employee. "Tier 1 employee": An
18employee under this Article who first became a member or
19participant before January 1, 2011 under any reciprocal
20retirement system or pension fund established under this Code
21other than a retirement system or pension fund established
22under Article 2, 3, 4, 5, 6, or 18 of this Code.
 
23    (40 ILCS 5/14-103.42 new)
24    Sec. 14-103.42. Future increase in income. "Future

 

 

10000SB0016sam001- 110 -LRB100 05169 RPS 22680 a

1increase in income" means an increase to a Tier 1 employee's
2base pay that is offered by a department to the Tier 1 employee
3for service under this Article after June 30, 2019 that
4qualifies as "compensation", as defined in Section 14-103.10,
5or would qualify as "compensation" but for the fact that it was
6offered to and accepted by the Tier 1 employee under the
7condition set forth in subsection (c) of Section 14-106.5. The
8term "future increase in income" includes an increase to a Tier
91 employee's base pay that is paid to the Tier 1 employee
10pursuant to an extension, amendment, or renewal of any
11employment contract or collective bargaining agreement after
12the effective date of this Section.
 
13    (40 ILCS 5/14-103.43 new)
14    Sec. 14-103.43. Base pay. As used in Section 14-103.42 of
15this Code, "base pay" means the greater of either (i) the Tier
161 employee's annualized rate of compensation as of June 30,
172019, or (ii) the Tier 1 employee's annualized rate of
18compensation immediately preceding the expiration, renewal, or
19amendment of an employment contract or collective bargaining
20agreement in effect on the effective date of this Section. For
21a person returning to active service as a Tier 1 employee after
22June 30, 2019, however, "base pay" means the employee's
23annualized rate of compensation as of the employee's last date
24of service prior to July 1, 2019. The System shall calculate
25the base pay of each Tier 1 employee pursuant to this Section.
 

 

 

10000SB0016sam001- 111 -LRB100 05169 RPS 22680 a

1    (40 ILCS 5/14-106.5 new)
2    Sec. 14-106.5. Election by Tier 1 employees.
3    (a) Each active Tier 1 employee shall make an irrevocable
4election either:
5        (1) to agree to delay his or her eligibility for
6    automatic annual increases in retirement annuity as
7    provided in subsection (a-1) of Section 14-114 and to have
8    the amount of the automatic annual increases in his or her
9    retirement annuity and survivors or widow's annuity that
10    are otherwise provided for in this Article calculated,
11    instead, as provided in subsection (a-1) of Section 14-114;
12    or
13        (2) to not agree to paragraph (1) of this subsection.
14    The election required under this subsection (a) shall be
15made by each active Tier 1 employee no earlier than January 1,
162019 and no later than March 31, 2019, except that:
17        (i) a person who becomes a Tier 1 employee under this
18    Article on or after January 1, 2019 must make the election
19    under this subsection (a) within 60 days after becoming a
20    Tier 1 employee; and
21        (ii) a person who returns to active service as a Tier 1
22    employee under this Article on or after January 1, 2019 and
23    has not yet made an election under this Section must make
24    the election under this subsection (a) within 60 days after
25    returning to active service as a Tier 1 employee.

 

 

10000SB0016sam001- 112 -LRB100 05169 RPS 22680 a

1    If a Tier 1 employee fails for any reason to make a
2required election under this subsection within the time
3specified, then the employee shall be deemed to have made the
4election under paragraph (2) of this subsection.
5    (a-5) If this Section is enjoined or stayed by an Illinois
6court or a court of competent jurisdiction pending the entry of
7a final and unappealable decision, and this Section is
8determined to be constitutional or otherwise valid by a final
9unappealable decision of an Illinois court or a court of
10competent jurisdiction, then the election procedure set forth
11in subsection (a) of this Section shall commence on the 180th
12calendar day after the date of the issuance of the final
13unappealable decision and shall conclude at the end of the
14270th calendar day after that date.
15    (a-10) All elections under subsection (a) that are made or
16deemed to be made before July 1, 2019 shall take effect on July
171, 2019. Elections that are made or deemed to be made on or
18after July 1, 2019 shall take effect on the first day of the
19month following the month in which the election is made or
20deemed to be made.
21    (b) As adequate and legal consideration provided under this
22amendatory Act of the 100th General Assembly for making an
23election under paragraph (1) of subsection (a) of this Section,
24the department shall be expressly and irrevocably prohibited
25from offering any future increases in income to a Tier 1
26employee who has made an election under paragraph (1) of

 

 

10000SB0016sam001- 113 -LRB100 05169 RPS 22680 a

1subsection (a) of this Section on the condition of not
2constituting compensation under Section 14-103.10.
3    As adequate and legal consideration provided under this
4amendatory Act of the 100th General Assembly for making an
5election under paragraph (1) of subsection (a) of this Section,
6each Tier 1 employee who has made an election under paragraph
7(1) of subsection (a) of this Section shall receive a
8consideration payment equal to 10% of the contributions made by
9or on behalf of the employee before the effective date of that
10election. The State Comptroller shall pay the consideration
11payment to the Tier 1 employee out of funds appropriated for
12that purpose under Section 1.9 of the State Pension Funds
13Continuing Appropriation Act. The System shall calculate the
14amount of each consideration payment and, by July 1, 2019,
15shall certify to the State Comptroller the amount of the
16consideration payment, together with the name, address, and any
17other available payment information of the Tier 1 employee as
18found in the records of the System. The System shall make
19additional calculations and certifications of consideration
20payments to the State Comptroller as it deems necessary.
21    (c) A Tier 1 employee who makes the election under
22paragraph (2) of subsection (a) of this Section shall not be
23subject to paragraph (1) of subsection (a) of this Section.
24However, each future increase in income offered by a department
25under this Article to a Tier 1 employee who has made the
26election under paragraph (2) of subsection (a) of this Section

 

 

10000SB0016sam001- 114 -LRB100 05169 RPS 22680 a

1shall be offered by the department expressly and irrevocably on
2the condition of not constituting compensation under Section
314-103.10 and that the Tier 1 employee's acceptance of the
4offered future increase in income shall constitute his or her
5agreement to that condition.
6    (d) The System shall make a good faith effort to contact
7each Tier 1 employee subject to this Section. The System shall
8mail information describing the required election to each Tier
91 employee by United States Postal Service mail to his or her
10last known address on file with the System. If the Tier 1
11employee is not responsive to other means of contact, it is
12sufficient for the System to publish the details of any
13required elections on its website or to publish those details
14in a regularly published newsletter or other existing public
15forum.
16    Tier 1 employees who are subject to this Section shall be
17provided with an election packet containing information
18regarding their options, as well as the forms necessary to make
19the required election. Upon request, the System shall offer
20Tier 1 employees an opportunity to receive information from the
21System before making the required election. The information may
22consist of video materials, group presentations, individual
23consultation with a member or authorized representative of the
24System in person or by telephone or other electronic means, or
25any combination of those methods. The System shall not provide
26advice or counseling with respect to which election a Tier 1

 

 

10000SB0016sam001- 115 -LRB100 05169 RPS 22680 a

1employee should make or specific to the legal or tax
2circumstances of or consequences to the Tier 1 employee.
3    The System shall inform Tier 1 employees in the election
4packet required under this subsection that the Tier 1 employee
5may also wish to obtain information and counsel relating to the
6election required under this Section from any other available
7source, including, but not limited to, labor organizations and
8private counsel.
9    In no event shall the System, its staff, or the Board be
10held liable for any information given to a member regarding the
11elections under this Section. The System shall coordinate with
12the Illinois Department of Central Management Services and each
13other retirement system administering an election in
14accordance with this amendatory Act of the 100th General
15Assembly to provide information concerning the impact of the
16election set forth in this Section.
17    (e) Notwithstanding any other provision of law, a
18department under this Article is required to offer each future
19increase in income expressly and irrevocably on the condition
20of not constituting "compensation" under Section 14-103.10 to
21any Tier 1 employee who has made an election under paragraph
22(2) of subsection (a) of this Section. The offer shall also
23provide that the Tier 1 employee's acceptance of the offered
24future increase in income shall constitute his or her agreement
25to the condition set forth in this subsection.
26    For purposes of legislative intent, the condition set forth

 

 

10000SB0016sam001- 116 -LRB100 05169 RPS 22680 a

1in this subsection shall be construed in a manner that ensures
2that the condition is not violated or circumvented through any
3contrivance of any kind.
4    (f) A member's election under this Section is not a
5prohibited election under subdivision (j)(1) of Section 1-119
6of this Code.
7    (g) No provision of this Section shall be interpreted in a
8way that would cause the System to cease to be a qualified plan
9under Section 401(a) of the Internal Revenue Code of 1986. The
10provisions of this Section shall be subject to and implemented
11in a manner that complies with Section 21 of Article V of the
12Illinois Constitution.
13    (h) If an election created by this amendatory Act in any
14other Article of this Code or any change deriving from that
15election is determined to be unconstitutional or otherwise
16invalid by a final unappealable decision of an Illinois court
17or a court of competent jurisdiction, the invalidity of that
18provision shall not in any way affect the validity of this
19Section or the changes deriving from the election required
20under this Section.
 
21    (40 ILCS 5/14-114)  (from Ch. 108 1/2, par. 14-114)
22    (Text of Section WITHOUT the changes made by P.A. 98-599,
23which has been held unconstitutional)
24    Sec. 14-114. Automatic increase in retirement annuity.
25    (a) Subject to the provisions of subsections (a-1), any Any

 

 

10000SB0016sam001- 117 -LRB100 05169 RPS 22680 a

1person receiving a retirement annuity under this Article who
2retires having attained age 60, or who retires before age 60
3having at least 35 years of creditable service, or who retires
4on or after January 1, 2001 at an age which, when added to the
5number of years of his or her creditable service, equals at
6least 85, shall, on January 1 next following the first full
7year of retirement, have the amount of the then fixed and
8payable monthly retirement annuity increased 3%. Any person
9receiving a retirement annuity under this Article who retires
10before attainment of age 60 and with less than (i) 35 years of
11creditable service if retirement is before January 1, 2001, or
12(ii) the number of years of creditable service which, when
13added to the member's age, would equal 85, if retirement is on
14or after January 1, 2001, shall have the amount of the fixed
15and payable retirement annuity increased by 3% on the January 1
16occurring on or next following (1) attainment of age 60, or (2)
17the first anniversary of retirement, whichever occurs later.
18However, for persons who receive the alternative retirement
19annuity under Section 14-110, references in this subsection (a)
20to attainment of age 60 shall be deemed to refer to attainment
21of age 55. For a person receiving early retirement incentives
22under Section 14-108.3 whose retirement annuity began after
23January 1, 1992 pursuant to an extension granted under
24subsection (e) of that Section, the first anniversary of
25retirement shall be deemed to be January 1, 1993. For a person
26who retires on or after June 28, 2001 and on or before October

 

 

10000SB0016sam001- 118 -LRB100 05169 RPS 22680 a

11, 2001, and whose retirement annuity is calculated, in whole
2or in part, under Section 14-110 or subsection (g) or (h) of
3Section 14-108, the first anniversary of retirement shall be
4deemed to be January 1, 2002.
5    On each January 1 following the date of the initial
6increase under this subsection, the employee's monthly
7retirement annuity shall be increased by an additional 3%.
8    Beginning January 1, 1990, and except as provided in
9subsection (a-1), all automatic annual increases payable under
10this Section shall be calculated as a percentage of the total
11annuity payable at the time of the increase, including previous
12increases granted under this Article.
13    (a-1) Notwithstanding any other provision of this Article,
14for a Tier 1 employee who made the election under paragraph (1)
15of subsection (a) of Section 14-106.5:
16        (1) The initial increase in retirement annuity under
17    this Section shall occur on the January 1 occurring either
18    on or after the attainment of age 67 or the fifth
19    anniversary of the annuity start date, whichever is
20    earlier.
21        (2) The amount of each automatic annual increase in
22    retirement annuity or survivors or widow's annuity
23    occurring on or after the effective date of that election
24    shall be calculated as a percentage of the originally
25    granted retirement annuity or survivors or widow's
26    annuity, equal to 3% or one-half the annual unadjusted

 

 

10000SB0016sam001- 119 -LRB100 05169 RPS 22680 a

1    percentage increase (but not less than zero) in the
2    consumer price index-u for the 12 months ending with the
3    September preceding each November 1, whichever is less. If
4    the annual unadjusted percentage change in the consumer
5    price index-u for the 12 months ending with the September
6    preceding each November 1 is zero or there is a decrease,
7    then the annuity shall not be increased.
8    For the purposes of this Section, "consumer price index-u"
9means the index published by the Bureau of Labor Statistics of
10the United States Department of Labor that measures the average
11change in prices of goods and services purchased by all urban
12consumers, United States city average, all items, 1982-84 =
13100. The new amount resulting from each annual adjustment shall
14be determined by the Public Pension Division of the Department
15of Insurance and made available to the board of the retirement
16system by November 1 of each year.
17    (b) The provisions of subsection (a) of this Section shall
18be applicable to an employee only if the employee makes the
19additional contributions required after December 31, 1969 for
20the purpose of the automatic increases for not less than the
21equivalent of one full year. If an employee becomes an
22annuitant before his additional contributions equal one full
23year's contributions based on his salary at the date of
24retirement, the employee may pay the necessary balance of the
25contributions to the system, without interest, and be eligible
26for the increasing annuity authorized by this Section.

 

 

10000SB0016sam001- 120 -LRB100 05169 RPS 22680 a

1    (c) The provisions of subsection (a) of this Section shall
2not be applicable to any annuitant who is on retirement on
3December 31, 1969, and thereafter returns to State service,
4unless the member has established at least one year of
5additional creditable service following reentry into service.
6    (d) In addition to other increases which may be provided by
7this Section, on January 1, 1981 any annuitant who was
8receiving a retirement annuity on or before January 1, 1971
9shall have his retirement annuity then being paid increased $1
10per month for each year of creditable service. On January 1,
111982, any annuitant who began receiving a retirement annuity on
12or before January 1, 1977, shall have his retirement annuity
13then being paid increased $1 per month for each year of
14creditable service.
15    On January 1, 1987, any annuitant who began receiving a
16retirement annuity on or before January 1, 1977, shall have the
17monthly retirement annuity increased by an amount equal to 8
18per year of creditable service times the number of years that
19have elapsed since the annuity began.
20    (e) Every person who receives the alternative retirement
21annuity under Section 14-110 and who is eligible to receive the
223% increase under subsection (a) on January 1, 1986, shall also
23receive on that date a one-time increase in retirement annuity
24equal to the difference between (1) his actual retirement
25annuity on that date, including any increases received under
26subsection (a), and (2) the amount of retirement annuity he

 

 

10000SB0016sam001- 121 -LRB100 05169 RPS 22680 a

1would have received on that date if the amendments to
2subsection (a) made by Public Act 84-162 had been in effect
3since the date of his retirement.
4(Source: P.A. 91-927, eff. 12-14-00; 92-14, eff. 6-28-01;
592-651, eff. 7-11-02.)
 
6    (40 ILCS 5/14-131)
7    Sec. 14-131. Contributions by State.
8    (a) The State shall make contributions to the System by
9appropriations of amounts which, together with other employer
10contributions from trust, federal, and other funds, employee
11contributions, investment income, and other income, will be
12sufficient to meet the cost of maintaining and administering
13the System on a 90% funded basis in accordance with actuarial
14recommendations.
15    For the purposes of this Section and Section 14-135.08,
16references to State contributions refer only to employer
17contributions and do not include employee contributions that
18are picked up or otherwise paid by the State or a department on
19behalf of the employee.
20    (b) The Board shall determine the total amount of State
21contributions required for each fiscal year on the basis of the
22actuarial tables and other assumptions adopted by the Board,
23using the formula in subsection (e).
24    The Board shall also determine a State contribution rate
25for each fiscal year, expressed as a percentage of payroll,

 

 

10000SB0016sam001- 122 -LRB100 05169 RPS 22680 a

1based on the total required State contribution for that fiscal
2year (less the amount received by the System from
3appropriations under Section 8.12 of the State Finance Act and
4Section 1 of the State Pension Funds Continuing Appropriation
5Act, if any, for the fiscal year ending on the June 30
6immediately preceding the applicable November 15 certification
7deadline), the estimated payroll (including all forms of
8compensation) for personal services rendered by eligible
9employees, and the recommendations of the actuary.
10    For the purposes of this Section and Section 14.1 of the
11State Finance Act, the term "eligible employees" includes
12employees who participate in the System, persons who may elect
13to participate in the System but have not so elected, persons
14who are serving a qualifying period that is required for
15participation, and annuitants employed by a department as
16described in subdivision (a)(1) or (a)(2) of Section 14-111.
17    (c) Contributions shall be made by the several departments
18for each pay period by warrants drawn by the State Comptroller
19against their respective funds or appropriations based upon
20vouchers stating the amount to be so contributed. These amounts
21shall be based on the full rate certified by the Board under
22Section 14-135.08 for that fiscal year. From the effective date
23of this amendatory Act of the 93rd General Assembly through the
24payment of the final payroll from fiscal year 2004
25appropriations, the several departments shall not make
26contributions for the remainder of fiscal year 2004 but shall

 

 

10000SB0016sam001- 123 -LRB100 05169 RPS 22680 a

1instead make payments as required under subsection (a-1) of
2Section 14.1 of the State Finance Act. The several departments
3shall resume those contributions at the commencement of fiscal
4year 2005.
5    (c-1) Notwithstanding subsection (c) of this Section, for
6fiscal years 2010, 2012, 2013, 2014, 2015, 2016, and 2017 only,
7contributions by the several departments are not required to be
8made for General Revenue Funds payrolls processed by the
9Comptroller. Payrolls paid by the several departments from all
10other State funds must continue to be processed pursuant to
11subsection (c) of this Section.
12    (c-2) For State fiscal years 2010, 2012, 2013, 2014, 2015,
132016, and 2017 only, on or as soon as possible after the 15th
14day of each month, the Board shall submit vouchers for payment
15of State contributions to the System, in a total monthly amount
16of one-twelfth of the fiscal year General Revenue Fund
17contribution as certified by the System pursuant to Section
1814-135.08 of the Illinois Pension Code.
19    (d) If an employee is paid from trust funds or federal
20funds, the department or other employer shall pay employer
21contributions from those funds to the System at the certified
22rate, unless the terms of the trust or the federal-State
23agreement preclude the use of the funds for that purpose, in
24which case the required employer contributions shall be paid by
25the State. From the effective date of this amendatory Act of
26the 93rd General Assembly through the payment of the final

 

 

10000SB0016sam001- 124 -LRB100 05169 RPS 22680 a

1payroll from fiscal year 2004 appropriations, the department or
2other employer shall not pay contributions for the remainder of
3fiscal year 2004 but shall instead make payments as required
4under subsection (a-1) of Section 14.1 of the State Finance
5Act. The department or other employer shall resume payment of
6contributions at the commencement of fiscal year 2005.
7    (e) For State fiscal years 2018 through 2045 (except as
8otherwise provided for fiscal year 2020), the minimum
9contribution to the System to be made by the State for each
10fiscal year shall be an amount determined by the System to be
11sufficient to bring the total assets of the System up to 90% of
12the total actuarial liabilities of the System by the end of
13State fiscal year 2045. In making these determinations, the
14required State contribution shall be calculated each year as a
15level percentage of total payroll, including payroll that is
16not deemed pensionable, over the years remaining to and
17including fiscal year 2045 and shall be determined under the
18projected unit credit actuarial cost method.
19    For State fiscal year 2020:
20        (1) The initial calculation and certification shall be
21    based on the amount determined above.
22        (2) For purposes of the recertification due on or
23    before May 1, 2019, the recalculation of the required State
24    contribution for fiscal year 2020 shall take into account
25    the effect on the System's liabilities of the elections
26    made under Section 14-106.5.

 

 

10000SB0016sam001- 125 -LRB100 05169 RPS 22680 a

1        (3) For purposes of the recertification due on or
2    before October 1, 2019, the total required State
3    contribution for fiscal year 2020 shall be reduced by the
4    amount of the consideration payments made to Tier 1
5    employees who made the election under paragraph (1) of
6    subsection (a) of Section 14-106.5.
7    Beginning in State fiscal year 2018, any increase or
8decrease in State contribution over the prior fiscal year due
9exclusively to changes in actuarial or investment assumptions
10adopted by the Board shall be included in the State
11contribution to the System, as a percentage of the applicable
12employee payroll, and shall be increased in equal annual
13increments so that by the State fiscal year occurring 5 years
14after the adoption of the actuarial or investment assumptions,
15the State is contributing at the rate otherwise required under
16this Section.
17    For State fiscal years 2012 through 2017 2045, the minimum
18contribution to the System to be made by the State for each
19fiscal year shall be an amount determined by the System to be
20sufficient to bring the total assets of the System up to 90% of
21the total actuarial liabilities of the System by the end of
22State fiscal year 2045. In making these determinations, the
23required State contribution shall be calculated each year as a
24level percentage of payroll over the years remaining to and
25including fiscal year 2045 and shall be determined under the
26projected unit credit actuarial cost method.

 

 

10000SB0016sam001- 126 -LRB100 05169 RPS 22680 a

1    For State fiscal years 1996 through 2005, the State
2contribution to the System, as a percentage of the applicable
3employee payroll, shall be increased in equal annual increments
4so that by State fiscal year 2011, the State is contributing at
5the rate required under this Section; except that (i) for State
6fiscal year 1998, for all purposes of this Code and any other
7law of this State, the certified percentage of the applicable
8employee payroll shall be 5.052% for employees earning eligible
9creditable service under Section 14-110 and 6.500% for all
10other employees, notwithstanding any contrary certification
11made under Section 14-135.08 before the effective date of this
12amendatory Act of 1997, and (ii) in the following specified
13State fiscal years, the State contribution to the System shall
14not be less than the following indicated percentages of the
15applicable employee payroll, even if the indicated percentage
16will produce a State contribution in excess of the amount
17otherwise required under this subsection and subsection (a):
189.8% in FY 1999; 10.0% in FY 2000; 10.2% in FY 2001; 10.4% in FY
192002; 10.6% in FY 2003; and 10.8% in FY 2004.
20    Notwithstanding any other provision of this Article, the
21total required State contribution to the System for State
22fiscal year 2006 is $203,783,900.
23    Notwithstanding any other provision of this Article, the
24total required State contribution to the System for State
25fiscal year 2007 is $344,164,400.
26    For each of State fiscal years 2008 through 2009, the State

 

 

10000SB0016sam001- 127 -LRB100 05169 RPS 22680 a

1contribution to the System, as a percentage of the applicable
2employee payroll, shall be increased in equal annual increments
3from the required State contribution for State fiscal year
42007, so that by State fiscal year 2011, the State is
5contributing at the rate otherwise required under this Section.
6    Notwithstanding any other provision of this Article, the
7total required State General Revenue Fund contribution for
8State fiscal year 2010 is $723,703,100 and shall be made from
9the proceeds of bonds sold in fiscal year 2010 pursuant to
10Section 7.2 of the General Obligation Bond Act, less (i) the
11pro rata share of bond sale expenses determined by the System's
12share of total bond proceeds, (ii) any amounts received from
13the General Revenue Fund in fiscal year 2010, and (iii) any
14reduction in bond proceeds due to the issuance of discounted
15bonds, if applicable.
16    Notwithstanding any other provision of this Article, the
17total required State General Revenue Fund contribution for
18State fiscal year 2011 is the amount recertified by the System
19on or before April 1, 2011 pursuant to Section 14-135.08 and
20shall be made from the proceeds of bonds sold in fiscal year
212011 pursuant to Section 7.2 of the General Obligation Bond
22Act, less (i) the pro rata share of bond sale expenses
23determined by the System's share of total bond proceeds, (ii)
24any amounts received from the General Revenue Fund in fiscal
25year 2011, and (iii) any reduction in bond proceeds due to the
26issuance of discounted bonds, if applicable.

 

 

10000SB0016sam001- 128 -LRB100 05169 RPS 22680 a

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

 

 

10000SB0016sam001- 129 -LRB100 05169 RPS 22680 a

1issued in fiscal year 2003 for the purposes of that Section
27.2, as determined and certified by the Comptroller, that is
3the same as the System's portion of the total moneys
4distributed under subsection (d) of Section 7.2 of the General
5Obligation Bond Act. In determining this maximum for State
6fiscal years 2008 through 2010, however, the amount referred to
7in item (i) shall be increased, as a percentage of the
8applicable employee payroll, in equal increments calculated
9from the sum of the required State contribution for State
10fiscal year 2007 plus the applicable portion of the State's
11total debt service payments for fiscal year 2007 on the bonds
12issued in fiscal year 2003 for the purposes of Section 7.2 of
13the General Obligation Bond Act, so that, by State fiscal year
142011, the State is contributing at the rate otherwise required
15under this Section.
16    (f) After the submission of all payments for eligible
17employees from personal services line items in fiscal year 2004
18have been made, the Comptroller shall provide to the System a
19certification of the sum of all fiscal year 2004 expenditures
20for personal services that would have been covered by payments
21to the System under this Section if the provisions of this
22amendatory Act of the 93rd General Assembly had not been
23enacted. Upon receipt of the certification, the System shall
24determine the amount due to the System based on the full rate
25certified by the Board under Section 14-135.08 for fiscal year
262004 in order to meet the State's obligation under this

 

 

10000SB0016sam001- 130 -LRB100 05169 RPS 22680 a

1Section. The System shall compare this amount due to the amount
2received by the System in fiscal year 2004 through payments
3under this Section and under Section 6z-61 of the State Finance
4Act. If the amount due is more than the amount received, the
5difference shall be termed the "Fiscal Year 2004 Shortfall" for
6purposes of this Section, and the Fiscal Year 2004 Shortfall
7shall be satisfied under Section 1.2 of the State Pension Funds
8Continuing Appropriation Act. If the amount due is less than
9the amount received, the difference shall be termed the "Fiscal
10Year 2004 Overpayment" for purposes of this Section, and the
11Fiscal Year 2004 Overpayment shall be repaid by the System to
12the Pension Contribution Fund as soon as practicable after the
13certification.
14    (g) For purposes of determining the required State
15contribution to the System, the value of the System's assets
16shall be equal to the actuarial value of the System's assets,
17which shall be calculated as follows:
18    As of June 30, 2008, the actuarial value of the System's
19assets shall be equal to the market value of the assets as of
20that date. In determining the actuarial value of the System's
21assets for fiscal years after June 30, 2008, any actuarial
22gains or losses from investment return incurred in a fiscal
23year shall be recognized in equal annual amounts over the
245-year period following that fiscal year.
25    (h) For purposes of determining the required State
26contribution to the System for a particular year, the actuarial

 

 

10000SB0016sam001- 131 -LRB100 05169 RPS 22680 a

1value of assets shall be assumed to earn a rate of return equal
2to the System's actuarially assumed rate of return.
3    (i) After the submission of all payments for eligible
4employees from personal services line items paid from the
5General Revenue Fund in fiscal year 2010 have been made, the
6Comptroller shall provide to the System a certification of the
7sum of all fiscal year 2010 expenditures for personal services
8that would have been covered by payments to the System under
9this Section if the provisions of this amendatory Act of the
1096th General Assembly had not been enacted. Upon receipt of the
11certification, the System shall determine the amount due to the
12System based on the full rate certified by the Board under
13Section 14-135.08 for fiscal year 2010 in order to meet the
14State's obligation under this Section. The System shall compare
15this amount due to the amount received by the System in fiscal
16year 2010 through payments under this Section. If the amount
17due is more than the amount received, the difference shall be
18termed the "Fiscal Year 2010 Shortfall" for purposes of this
19Section, and the Fiscal Year 2010 Shortfall shall be satisfied
20under Section 1.2 of the State Pension Funds Continuing
21Appropriation Act. If the amount due is less than the amount
22received, the difference shall be termed the "Fiscal Year 2010
23Overpayment" for purposes of this Section, and the Fiscal Year
242010 Overpayment shall be repaid by the System to the General
25Revenue Fund as soon as practicable after the certification.
26    (j) After the submission of all payments for eligible

 

 

10000SB0016sam001- 132 -LRB100 05169 RPS 22680 a

1employees from personal services line items paid from the
2General Revenue Fund in fiscal year 2011 have been made, the
3Comptroller shall provide to the System a certification of the
4sum of all fiscal year 2011 expenditures for personal services
5that would have been covered by payments to the System under
6this Section if the provisions of this amendatory Act of the
796th General Assembly had not been enacted. Upon receipt of the
8certification, the System shall determine the amount due to the
9System based on the full rate certified by the Board under
10Section 14-135.08 for fiscal year 2011 in order to meet the
11State's obligation under this Section. The System shall compare
12this amount due to the amount received by the System in fiscal
13year 2011 through payments under this Section. If the amount
14due is more than the amount received, the difference shall be
15termed the "Fiscal Year 2011 Shortfall" for purposes of this
16Section, and the Fiscal Year 2011 Shortfall shall be satisfied
17under Section 1.2 of the State Pension Funds Continuing
18Appropriation Act. If the amount due is less than the amount
19received, the difference shall be termed the "Fiscal Year 2011
20Overpayment" for purposes of this Section, and the Fiscal Year
212011 Overpayment shall be repaid by the System to the General
22Revenue Fund as soon as practicable after the certification.
23    (k) For fiscal years 2012 through 2017 only, after the
24submission of all payments for eligible employees from personal
25services line items paid from the General Revenue Fund in the
26fiscal year have been made, the Comptroller shall provide to

 

 

10000SB0016sam001- 133 -LRB100 05169 RPS 22680 a

1the System a certification of the sum of all expenditures in
2the fiscal year for personal services. Upon receipt of the
3certification, the System shall determine the amount due to the
4System based on the full rate certified by the Board under
5Section 14-135.08 for the fiscal year in order to meet the
6State's obligation under this Section. The System shall compare
7this amount due to the amount received by the System for the
8fiscal year. If the amount due is more than the amount
9received, the difference shall be termed the "Prior Fiscal Year
10Shortfall" for purposes of this Section, and the Prior Fiscal
11Year Shortfall shall be satisfied under Section 1.2 of the
12State Pension Funds Continuing Appropriation Act. If the amount
13due is less than the amount received, the difference shall be
14termed the "Prior Fiscal Year Overpayment" for purposes of this
15Section, and the Prior Fiscal Year Overpayment shall be repaid
16by the System to the General Revenue Fund as soon as
17practicable after the certification.
18(Source: P.A. 98-24, eff. 6-19-13; 98-674, eff. 6-30-14; 99-8,
19eff. 7-9-15; 99-523, eff. 6-30-16.)
 
20    (40 ILCS 5/14-133)  (from Ch. 108 1/2, par. 14-133)
21    (Text of Section WITHOUT the changes made by P.A. 98-599,
22which has been held unconstitutional)
23    Sec. 14-133. Contributions on behalf of members.
24    (a) Except as provided in subsection (a-5), each Each
25participating employee shall make contributions to the System,

 

 

10000SB0016sam001- 134 -LRB100 05169 RPS 22680 a

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

 

 

10000SB0016sam001- 135 -LRB100 05169 RPS 22680 a

1    Corrections or of the Department of Human Services who is
2    not a covered employee, 1% for a widow or survivors annuity
3    plus the following amount for retirement annuity: 8.5%
4    through December 31, 2001; 9.5% in 2002; 10.5% in 2003; and
5    11.5% in 2004 and thereafter.
6    (a-5) Beginning July 1, 2019 or the effective date of the
7Tier 1 employee's election under paragraph (1) of subsection
8(a) of Section 14-106.5, whichever is later, in lieu of the
9contributions otherwise required under subsection (a), each
10Tier 1 employee who made the election under paragraph (1) of
11subsection (a) of Section 14-106.5 who is a participating
12employee shall make contributions to the System, based on his
13or her compensation, as follows:
14        (1) Covered employees, except as indicated below,
15    3.15% for retirement annuity, and 0.45% for a widow or
16    survivors annuity;
17        (2) Noncovered employees, except as indicated below,
18    6.3% for retirement annuity and 0.9% for a widow or
19    survivors annuity;
20        (3) Noncovered employees serving in a position in which
21    "eligible creditable service" as defined in Section 14-110
22    may be earned, 10.35% for retirement annuity and 0.9% for a
23    widow or survivors annuity;
24        (4) Covered employees serving in a position in which
25    "eligible creditable service" as defined in Section 14-110
26    may be earned, 7.2% for retirement annuity and 0.45% for a

 

 

10000SB0016sam001- 136 -LRB100 05169 RPS 22680 a

1    widow or survivors annuity;
2        (5) Each security employee of the Department of
3    Corrections or of the Department of Human Services who is a
4    covered employee, 10.8% for retirement annuity and 0.45%
5    for a widow or survivors annuity;
6        (6) Each security employee of the Department of
7    Corrections or of the Department of Human Services who is
8    not a covered employee, 10.35% for retirement annuity and
9    0.9% for a widow or survivors annuity.
10    (b) Contributions shall be in the form of a deduction from
11compensation and shall be made notwithstanding that the
12compensation paid in cash to the employee shall be reduced
13thereby below the minimum prescribed by law or regulation. Each
14member is deemed to consent and agree to the deductions from
15compensation provided for in this Article, and shall receipt in
16full for salary or compensation.
17(Source: P.A. 92-14, eff. 6-28-01.)
 
18    (40 ILCS 5/14-135.08)  (from Ch. 108 1/2, par. 14-135.08)
19    (Text of Section WITHOUT the changes made by P.A. 98-599,
20which has been held unconstitutional)
21    Sec. 14-135.08. To certify required State contributions.
22    (a) To certify to the Governor and to each department, on
23or before November 15 of each year until November 15, 2011, the
24required rate for State contributions to the System for the
25next State fiscal year, as determined under subsection (b) of

 

 

10000SB0016sam001- 137 -LRB100 05169 RPS 22680 a

1Section 14-131. The certification to the Governor under this
2subsection (a) shall include a copy of the actuarial
3recommendations upon which the rate is based and shall
4specifically identify the System's projected State normal cost
5for that fiscal year.
6    (a-5) On or before November 1 of each year, beginning
7November 1, 2012, the Board shall submit to the State Actuary,
8the Governor, and the General Assembly a proposed certification
9of the amount of the required State contribution to the System
10for the next fiscal year, along with all of the actuarial
11assumptions, calculations, and data upon which that proposed
12certification is based. On or before January 1 of each year
13beginning January 1, 2013, the State Actuary shall issue a
14preliminary report concerning the proposed certification and
15identifying, if necessary, recommended changes in actuarial
16assumptions that the Board must consider before finalizing its
17certification of the required State contributions. On or before
18January 15, 2013 and each January 15 thereafter, the Board
19shall certify to the Governor and the General Assembly the
20amount of the required State contribution for the next fiscal
21year. The Board's certification must note any deviations from
22the State Actuary's recommended changes, the reason or reasons
23for not following the State Actuary's recommended changes, and
24the fiscal impact of not following the State Actuary's
25recommended changes on the required State contribution.
26    (a-10) For purposes of subsection (c-5) of Section 20 of

 

 

10000SB0016sam001- 138 -LRB100 05169 RPS 22680 a

1the Budget Stabilization Act, on or before November 1 of each
2year beginning November 1, 2019, the Board shall determine the
3amount of the State contribution to the System that would have
4been required for the next fiscal year if Section 1-161,
5Section 14-155.2, and the changes made to Section 1-160 by this
6amendatory Act of the 100th General Assembly had not taken
7effect, using the best and most recent available data but based
8on the law in effect on May 31, 2019. The Board shall submit to
9the State Actuary, the Governor, and the General Assembly a
10proposed certification, along with the relevant law, actuarial
11assumptions, calculations, and data upon which that
12certification is based. On or before January 1, 2020 and every
13January 1 thereafter, the State Actuary shall issue a
14preliminary report concerning the proposed certification and
15identifying, if necessary, recommended changes in actuarial
16assumptions that the Board must consider before finalizing its
17certification. On or before January 15, 2020 and every January
181 thereafter, the Board shall certify to the Governor and the
19General Assembly the amount of the State contribution to the
20System that would have been required for the next fiscal year
21if Section 1-161, Section 14-155.2, and the changes made to
22Section 1-160 by this amendatory Act of the 100th General
23Assembly had not taken effect, using the best and most recent
24available data but based on the law in effect on May 31, 2019.
25The Board's certification must note any deviations from the
26State Actuary's recommended changes, the reason or reasons for

 

 

10000SB0016sam001- 139 -LRB100 05169 RPS 22680 a

1not following the State Actuary's recommended changes, and the
2impact of not following the State Actuary's recommended
3changes.
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

 

 

10000SB0016sam001- 140 -LRB100 05169 RPS 22680 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 Board shall
18recalculate and recertify to the State Actuary, 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. The State Actuary
23shall review the assumptions and valuations underlying the
24Board's revised certification and issue a preliminary report
25concerning the proposed recertification and identifying, if
26necessary, recommended changes in actuarial assumptions that

 

 

10000SB0016sam001- 141 -LRB100 05169 RPS 22680 a

1the Board must consider before finalizing its certification of
2the required State contributions. The Board's final
3certification must note any deviations from the State Actuary's
4recommended changes, the reason or reasons for not following
5the State Actuary's recommended changes, and the fiscal impact
6of not following the State Actuary's recommended changes on the
7required State contribution.
8    On or before May 1, 2019, 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 2020, taking into account the effect on the
12System's liabilities of the elections made under Section
1314-106.5.
14    On or before October 1, 2019, 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 2020, taking into account the reduction
18specified under item (3) of subsection (e) of Section 14-131.
19(Source: P.A. 96-1497, eff. 1-14-11; 96-1511, eff. 1-27-11;
2097-694, eff. 6-18-12.)
 
21    (40 ILCS 5/14-147.5 new)
22    Sec. 14-147.5. Accelerated pension benefit payment.
23    (a) As used in this Section:
24    "Eligible person" means a person who:
25        (1) has terminated service;

 

 

10000SB0016sam001- 142 -LRB100 05169 RPS 22680 a

1        (2) has accrued sufficient service credit to be
2    eligible to receive a retirement annuity under this
3    Article;
4        (3) has not received any retirement annuity under this
5    Article; and
6        (4) does not have a QILDRO in effect against him or her
7    under this Article.
8    "Pension benefit" means the benefits under this Article, or
9Article 1 as it relates to those benefits, including any
10anticipated annual increases, that an eligible person is
11entitled to upon attainment of the applicable retirement age.
12"Pension benefit" also includes applicable survivor's or
13disability benefits.
14    (b) Before January 1, 2019, and annually thereafter, the
15System shall calculate, using actuarial tables and other
16assumptions adopted by the Board, the net present value of
17pension benefits for each eligible person and shall offer each
18eligible person the opportunity to irrevocably elect to receive
19an amount determined by the System to be equal to 70% of the
20net present value of his or her pension benefits in lieu of
21receiving any pension benefit. The offer shall specify the
22dollar amount that the eligible person will receive if he or
23she so elects and shall expire when a subsequent offer is made
24to an eligible person or when the System determines that 10% of
25eligible persons in that year have made the election under this
26subsection, whichever occurs first. The System shall make a

 

 

10000SB0016sam001- 143 -LRB100 05169 RPS 22680 a

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

 

 

10000SB0016sam001- 144 -LRB100 05169 RPS 22680 a

1    that return to active service shall be based solely on the
2    person's credits and creditable service arising from the
3    return to active service.
4        (2) The accelerated pension benefit payment may not be
5    repaid to the System, and the terminated credits and
6    creditable service may not under any circumstances be
7    reinstated.
8    (e) As a condition of receiving an accelerated pension
9benefit payment, an eligible person must have another
10retirement plan or account qualified under the Internal Revenue
11Code of 1986, as amended, for the accelerated pension benefit
12payment to be rolled into. The accelerated pension benefit
13payment under this Section may be subject to withholding or
14payment of applicable taxes, but to the extent permitted by
15federal law, a person who receives an accelerated pension
16benefit payment under this Section must direct the System to
17pay all of that payment as a rollover into another retirement
18plan or account qualified under the Internal Revenue Code of
191986, as amended.
20    (f) Before January 1, 2020 and every January 1 thereafter,
21the Board shall certify to the Illinois Finance Authority and
22the General Assembly the amount by which the total amount of
23accelerated pension benefit payments made under this Section
24exceed the amount appropriated to the System for the purpose of
25making those payments.
26    (g) The Board shall adopt any rules necessary to implement

 

 

10000SB0016sam001- 145 -LRB100 05169 RPS 22680 a

1this Section.
2    (h) No provision of this Section shall be interpreted in a
3way that would cause the applicable System to cease to be a
4qualified plan under the Internal Revenue Code of 1986.
5    (i) Notwithstanding any other provision of this Section, in
6no case shall the total amount of accelerated pension benefit
7payments paid under this Section, Section 15-185.5, and Section
816-190.5 cause the Illinois Finance Authority to issue more
9than the $250,000,000 of State Pension Obligation Acceleration
10Bonds authorized in subsection (c-5) of Section 801-40 of the
11Illinois Finance Authority Act.
 
12    (40 ILCS 5/14-152.1)
13    (Text of Section WITHOUT the changes made by P.A. 98-599,
14which has been held unconstitutional)
15    Sec. 14-152.1. Application and expiration of new benefit
16increases.
17    (a) As used in this Section, "new benefit increase" means
18an increase in the amount of any benefit provided under this
19Article, or an expansion of the conditions of eligibility for
20any benefit under this Article, that results from an amendment
21to this Code that takes effect after June 1, 2005 (the
22effective date of Public Act 94-4). "New benefit increase",
23however, does not include any benefit increase resulting from
24the changes made to this Article by Public Act 96-37 or by this
25amendatory Act of the 100th General Assembly this amendatory

 

 

10000SB0016sam001- 146 -LRB100 05169 RPS 22680 a

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

 

 

10000SB0016sam001- 147 -LRB100 05169 RPS 22680 a

1    (d) Every new benefit increase shall expire 5 years after
2its effective date or on such earlier date as may be specified
3in the language enacting the new benefit increase or provided
4under subsection (c). This does not prevent the General
5Assembly from extending or re-creating a new benefit increase
6by law.
7    (e) Except as otherwise provided in the language creating
8the new benefit increase, a new benefit increase that expires
9under this Section continues to apply to persons who applied
10and qualified for the affected benefit while the new benefit
11increase was in effect and to the affected beneficiaries and
12alternate payees of such persons, but does not apply to any
13other person, including without limitation a person who
14continues in service after the expiration date and did not
15apply and qualify for the affected benefit while the new
16benefit increase was in effect.
17(Source: P.A. 96-37, eff. 7-13-09.)
 
18    (40 ILCS 5/14-155.1 new)
19    Sec. 14-155.1. Defined contribution plan.
20    (a) By July 1, 2019, the System shall prepare and implement
21a voluntary defined contribution plan for up to 5% of eligible
22active Tier 1 employees. The System shall determine the 5% cap
23by the number of active Tier 1 employees on the effective date
24of this Section. The defined contribution plan developed under
25this Section shall be a plan that aggregates employer and

 

 

10000SB0016sam001- 148 -LRB100 05169 RPS 22680 a

1employee contributions in individual participant accounts
2which, after meeting any other requirements, are used for
3payouts after retirement in accordance with this Section and
4any other applicable laws.
5    As used in this Section, "defined benefit plan" means the
6retirement plan available under this Article to Tier 1
7employees who have not made the election authorized under this
8Section.
9        (1) Under the defined contribution plan, an active Tier
10    1 employee of this System could elect to cease accruing
11    benefits in the defined benefit plan under this Article and
12    begin accruing benefits for future service in the defined
13    contribution plan. Service credit under the defined
14    contribution plan may be used for determining retirement
15    eligibility under the defined benefit plan.
16        (2) Participants in the defined contribution plan
17    shall pay employee contributions at the same rate as Tier 1
18    employees in this System who do not participate in the
19    defined contribution plan.
20        (3) State contributions shall be paid into the accounts
21    of all participants in the defined contribution plan at a
22    uniform rate, expressed as a percentage of compensation and
23    determined for each year. This rate shall be no higher than
24    the employer's normal cost for Tier 1 employees in the
25    defined benefit plan for that year, as determined by the
26    System and expressed as a percentage of compensation, and

 

 

10000SB0016sam001- 149 -LRB100 05169 RPS 22680 a

1    shall be no lower than 3% of compensation. The State shall
2    adjust this rate annually.
3        (4) The defined contribution plan shall require 5 years
4    of participation in the defined contribution plan before
5    vesting in State contributions. If the participant fails to
6    vest in them, the State contributions, and the earnings
7    thereon, shall be forfeited.
8        (5) The defined contribution plan may provide for
9    participants in the plan to be eligible for the defined
10    disability benefits available to other participants under
11    this Article. If it does, the System shall reduce the
12    employee contributions credited to the member's defined
13    contribution plan account by an amount determined by the
14    System to cover the cost of offering such benefits.
15        (6) The defined contribution plan shall provide a
16    variety of options for investments. These options shall
17    include investments handled by the Illinois State Board of
18    Investment as well as private sector investment options.
19        (7) The defined contribution plan shall provide a
20    variety of options for payouts to retirees and their
21    survivors.
22        (8) To the extent authorized under federal law and as
23    authorized by the System, the plan shall allow former
24    participants in the plan to transfer or roll over employee
25    and vested State contributions, and the earnings thereon,
26    into other qualified retirement plans.

 

 

10000SB0016sam001- 150 -LRB100 05169 RPS 22680 a

1        (9) The System shall reduce the employee contributions
2    credited to the member's defined contribution plan account
3    by an amount determined by the System to cover the cost of
4    offering these benefits and any applicable administrative
5    fees.
6    (b) Only persons who are active Tier 1 employees of the
7System on the effective date of this Section are eligible to
8participate in the defined contribution plan. Participation in
9the defined contribution plan shall be limited to the first 5%
10of eligible persons who elect to participate. The election to
11participate in the defined contribution plan is voluntary and
12irrevocable.
13    (c) An eligible Tier 1 employee may irrevocably elect to
14participate in the defined contribution plan by filing with the
15System a written application to participate that is received by
16the System prior to its determination that 5% of eligible
17persons have elected to participate in the defined contribution
18plan.
19    When the System first determines that 5% of eligible
20persons have elected to participate in the defined contribution
21plan, the System shall provide notice to previously eligible
22employees that the plan is no longer available and shall cease
23accepting applications to participate.
24    (d) The System shall make a good faith effort to contact
25each active Tier 1 employee who is eligible to participate in
26the defined contribution plan. The System shall mail

 

 

10000SB0016sam001- 151 -LRB100 05169 RPS 22680 a

1information describing the option to join the defined
2contribution plan to each of these employees to his or her last
3known address on file with the System. If the employee is not
4responsive to other means of contact, it is sufficient for the
5System to publish the details of the option on its website.
6    Upon request for further information describing the
7option, the System shall provide employees with information
8from the System before exercising the option to join the plan,
9including information on the impact to their vested benefits or
10non-vested service. The individual consultation shall include
11projections of the member's defined benefits at retirement or
12earlier termination of service and the value of the member's
13account at retirement or earlier termination of service. The
14System shall not provide advice or counseling with respect to
15whether the employee should exercise the option. The System
16shall inform Tier 1 employees who are eligible to participate
17in the defined contribution plan that they may also wish to
18obtain information and counsel relating to their option from
19any other available source, including, but not limited to,
20labor organizations, private counsel, and financial advisors.
21    (e) In no event shall the System, its staff, its authorized
22representatives, or the Board be liable for any information
23given to an employee under this Section. The System may
24coordinate with the Illinois Department of Central Management
25Services and other retirement systems administering a defined
26contribution plan in accordance with this amendatory Act of the

 

 

10000SB0016sam001- 152 -LRB100 05169 RPS 22680 a

1100th General Assembly to provide information concerning the
2impact of the option set forth in this Section.
3    (f) Notwithstanding any other provision of this Section, no
4person shall begin participating in the defined contribution
5plan until it has attained qualified plan status and received
6all necessary approvals from the U.S. Internal Revenue Service.
7    (g) The System shall report on its progress under this
8Section, including the available details of the defined
9contribution plan and the System's plans for informing eligible
10Tier 1 employees about the plan, to the Governor and the
11General Assembly on or before January 15, 2019.
12    (h) The Illinois State Board of Investment shall be the
13plan sponsor for the defined contribution plan established
14under this Section.
15    (i) The intent of this amendatory Act of the 100th General
16Assembly is to ensure that the State's normal cost of
17participation in the defined contribution plan is similar, and
18if possible equal, to the State's normal cost of participation
19in the defined benefit plan, unless a lower State's normal cost
20is necessary to ensure cost neutrality.
21    (j) If Section 14-106.5 is determined to be
22unconstitutional or otherwise invalid by a final unappealable
23decision of an Illinois court or a court of competent
24jurisdiction, then this Section shall not take effect and is
25repealed by operation of law.
 

 

 

10000SB0016sam001- 153 -LRB100 05169 RPS 22680 a

1    (40 ILCS 5/14-155.2 new)
2    Sec. 14-155.2. Defined contribution plan for certain
3covered employees.
4    (a) As used in this Section:
5    "Defined benefit plan" means the retirement plan available
6under this Article and Section 1-160 to eligible covered
7employees who do not make the election authorized under this
8Section.
9    "Eligible covered employee" means a covered employee who
10first becomes a participant under this Article on or after 6
11months after the effective date of this amendatory Act of the
12100th General Assembly.
13    (b) In lieu of the defined benefit plan, an eligible
14covered employee may irrevocably elect to participate in the
15defined contribution plan under this Section. The election to
16participate in the defined contribution plan must be made
17within 30 days after becoming an eligible covered employee. The
18election to participate in the defined contribution plan under
19this Section is voluntary and irrevocable.
20    (c) No later than 5 months after the effective date of this
21amendatory Act of the 100th General Assembly, the System shall
22prepare and implement a voluntary defined contribution plan for
23eligible covered employees. The defined contribution plan
24developed under this Section shall be a plan that aggregates
25employer and employee contributions in individual participant
26accounts which, after meeting any other requirements, are used

 

 

10000SB0016sam001- 154 -LRB100 05169 RPS 22680 a

1for payouts after retirement in accordance with this Section
2and any other applicable laws.
3        (1) A participant in the defined contribution plan
4    shall contribute a minimum of 3% of his or her compensation
5    to the defined contribution plan.
6        (2) For persons who participate in the defined
7    contribution plan for at least one year, employer
8    contributions shall be paid into the accounts of those
9    participants at a rate of 3% of compensation.
10        (3) Employer contributions shall vest when those
11    contributions are paid into a participant's account.
12        (4) The defined contribution plan shall provide a
13    variety of options for investments. These options shall
14    include investments handled by the Illinois State Board of
15    Investment as well as private sector investment options.
16        (5) The defined contribution plan shall provide a
17    variety of options for payouts to retirees and their
18    survivors.
19        (6) To the extent authorized under federal law and as
20    authorized by the affected pension fund, the defined
21    contribution plan shall allow former participants in the
22    plan to transfer or roll over employee and employer
23    contributions, and the earnings thereon, into other
24    qualified retirement plans.
25        (7) The System shall reduce the employee contributions
26    credited to the participant's defined contribution plan

 

 

10000SB0016sam001- 155 -LRB100 05169 RPS 22680 a

1    account by an amount determined by the System to cover the
2    cost of offering the benefits under this Section and any
3    applicable administrative fees.
 
4    (40 ILCS 5/14-156.1 new)
5    Sec. 14-156.1. Defined contribution plan; termination. If
6the defined contribution plan under Section 14-155.1 is
7terminated or becomes inoperative pursuant to law, then each
8participant in the plan shall automatically be deemed to have
9been a contributing Tier 1 employee in the System's defined
10benefit plan during the time in which he or she participated in
11the defined contribution plan, and for that purpose the System
12shall be entitled to recover the amounts in the participant's
13defined contribution accounts.
 
14    (40 ILCS 5/15-108.1)
15    Sec. 15-108.1. Tier 1 member; Tier 1 employee.
16    "Tier 1 member": A participant or an annuitant of a
17retirement annuity under this Article, other than a participant
18in the self-managed plan under Section 15-158.2, who first
19became a participant or member before January 1, 2011 under any
20reciprocal retirement system or pension fund established under
21this Code, other than a retirement system or pension fund
22established under Articles 2, 3, 4, 5, 6, or 18 of this Code.
23"Tier 1 member" includes a person who first became a
24participant under this System before January 1, 2011 and who

 

 

10000SB0016sam001- 156 -LRB100 05169 RPS 22680 a

1accepts a refund and is subsequently reemployed by an employer
2on or after January 1, 2011.
3    "Tier 1 employee": A Tier 1 member who is a participating
4employee, unless he or she is a disability benefit recipient
5under Section 15-150. However, for the purposes of the election
6under Section 15-132.9, "Tier 1 employee" does not include an
7individual who has made an irrevocable election on or before
8June 1, 2017 to retire from service pursuant to the terms of an
9employment contract or a collective bargaining agreement in
10effect on June 1, 2017, excluding any extension, amendment, or
11renewal of that agreement on or after that date, and has
12notified the System of that election.
13(Source: P.A. 98-92, eff. 7-16-13.)
 
14    (40 ILCS 5/15-108.2)
15    Sec. 15-108.2. Tier 2 member. "Tier 2 member": A person who
16first becomes a participant under this Article on or after
17January 1, 2011 and before 6 months after the effective date of
18this amendatory Act of the 100th General Assembly, other than a
19person in the self-managed plan established under Section
2015-158.2 or a person who makes the election under subsection
21(c) of Section 1-161, unless the person is otherwise a Tier 1
22member. The changes made to this Section by this amendatory Act
23of the 98th General Assembly are a correction of existing law
24and are intended to be retroactive to the effective date of
25Public Act 96-889, notwithstanding the provisions of Section

 

 

10000SB0016sam001- 157 -LRB100 05169 RPS 22680 a

11-103.1 of this Code.
2(Source: P.A. 98-92, eff. 7-16-13; 98-596, eff. 11-19-13.)
 
3    (40 ILCS 5/15-111)  (from Ch. 108 1/2, par. 15-111)
4    Sec. 15-111. Earnings.
5    (a) "Earnings": Subject to Section 15-111.5, an amount paid
6for personal services equal to the sum of the basic
7compensation plus extra compensation for summer teaching,
8overtime or other extra service. For periods for which an
9employee receives service credit under subsection (c) of
10Section 15-113.1 or Section 15-113.2, earnings are equal to the
11basic compensation on which contributions are paid by the
12employee during such periods. Compensation for employment
13which is irregular, intermittent and temporary shall not be
14considered earnings, unless the participant is also receiving
15earnings from the employer as an employee under Section 15-107.
16    With respect to transition pay paid by the University of
17Illinois to a person who was a participating employee employed
18in the fire department of the University of Illinois's
19Champaign-Urbana campus immediately prior to the elimination
20of that fire department:
21        (1) "Earnings" includes transition pay paid to the
22    employee on or after the effective date of this amendatory
23    Act of the 91st General Assembly.
24        (2) "Earnings" includes transition pay paid to the
25    employee before the effective date of this amendatory Act

 

 

10000SB0016sam001- 158 -LRB100 05169 RPS 22680 a

1    of the 91st General Assembly only if (i) employee
2    contributions under Section 15-157 have been withheld from
3    that transition pay or (ii) the employee pays to the System
4    before January 1, 2001 an amount representing employee
5    contributions under Section 15-157 on that transition pay.
6    Employee contributions under item (ii) may be paid in a
7    lump sum, by withholding from additional transition pay
8    accruing before January 1, 2001, or in any other manner
9    approved by the System. Upon payment of the employee
10    contributions on transition pay, the corresponding
11    employer contributions become an obligation of the State.
12    (a-5) Notwithstanding any other provision of this Section,
13"earnings" does not include any future increase in income that
14is offered for service by an employer to a Tier 1 employee
15under this Article pursuant to the condition set forth in
16subsection (c) of Section 15-132.9 and accepted under that
17condition by a Tier 1 employee who has made the election under
18paragraph (2) of subsection (a) of Section 15-132.9.
19    (a-10) Notwithstanding any other provision of this
20Section, "earnings" does not include any consideration payment
21made to a Tier 1 employee.
22    (b) For a Tier 2 member, the annual earnings shall not
23exceed $106,800; however, that amount shall annually
24thereafter be increased by the lesser of (i) 3% of that amount,
25including all previous adjustments, or (ii) one half the annual
26unadjusted percentage increase (but not less than zero) in the

 

 

10000SB0016sam001- 159 -LRB100 05169 RPS 22680 a

1consumer price index-u for the 12 months ending with the
2September preceding each November 1, including all previous
3adjustments.
4    For the purposes of this Section, "consumer price index u"
5means the index published by the Bureau of Labor Statistics of
6the United States Department of Labor that measures the average
7change in prices of goods and services purchased by all urban
8consumers, United States city average, all items, 1982-84 =
9100. The new amount resulting from each annual adjustment shall
10be determined by the Public Pension Division of the Department
11of Insurance and made available to the boards of the retirement
12systems and pension funds by November 1 of each year.
13    (c) With each submission of payroll information in the
14manner prescribed by the System, the employer shall certify
15that the payroll information is correct and complies with all
16applicable State and federal laws.
17(Source: P.A. 98-92, eff. 7-16-13; 99-897, eff. 1-1-17.)
 
18    (40 ILCS 5/15-112.1 new)
19    Sec. 15-112.1. Future increase in income. "Future increase
20in income" means an increase to a Tier 1 employee's base pay
21that is offered by an employer to the Tier 1 employee for
22service under this Article after June 30, 2018 that qualifies
23as "earnings", as defined in Section 15-111, or would qualify
24as "earnings" but for the fact that it was offered to and
25accepted by the Tier 1 employee under the condition set forth

 

 

10000SB0016sam001- 160 -LRB100 05169 RPS 22680 a

1in subsection (c) of Section 15-132.9. The term "future
2increase in income" includes an increase to a Tier 1 employee's
3base pay that is paid to the Tier 1 employee pursuant to an
4extension, amendment, or renewal of any such employment
5contract or collective bargaining agreement after the
6effective date of this Section.
 
7    (40 ILCS 5/15-112.2 new)
8    Sec. 15-112.2. Base pay. As used in Section 15-112.1 of
9this Code, "base pay" means the greater of either (i) the Tier
101 employee's annualized rate of earnings as of June 30, 2018,
11or (ii) the Tier 1 employee's annualized rate of earnings
12immediately preceding the expiration, renewal, or amendment of
13an employment contract or collective bargaining agreement in
14effect on the effective date of this Section. For a person
15returning to participating employee status as a Tier 1 employee
16after June 30, 2018, however, "base pay" means the employee's
17annualized rate of earnings as of the employee's last date of
18service prior to July 1, 2018. The System shall calculate the
19base pay of each Tier 1 employee pursuant to this Section.
 
20    (40 ILCS 5/15-132.9 new)
21    Sec. 15-132.9. Election by Tier 1 employees.
22    (a) Each Tier 1 employee shall make an irrevocable election
23either:
24        (1) to agree to delay his or her eligibility for

 

 

10000SB0016sam001- 161 -LRB100 05169 RPS 22680 a

1    automatic annual increases in retirement annuity as
2    provided in subsection (d-1) of Section 15-136 and to have
3    the amount of the automatic annual increases in his or her
4    retirement annuity and survivor annuity that are otherwise
5    provided for in this Article calculated, instead, as
6    provided in subsection (d-1) of Section 15-136; or
7        (2) to not agree to the provisions of paragraph (1) of
8    this subsection.
9    The election required under this subsection (a) shall be
10made by each Tier 1 employee no earlier than January 1, 2018
11and no later than March 31, 2018, except that:
12        (i) a person who becomes a Tier 1 employee under this
13    Article on or after January 1, 2018 must make the election
14    under this subsection (a) within 60 days after becoming a
15    Tier 1 employee;
16        (ii) a person who returns to participating employee
17    status as a Tier 1 employee under this Article on or after
18    January 1, 2018 and has not yet made an election under this
19    Section must make the election under this subsection (a)
20    within 60 days after returning to participating employee
21    status as a Tier 1 employee; and
22        (iii) a person who returns to participating employee
23    status as a Tier 1 employee under this Article but who has
24    not made an election under Section 15-134.5 must make the
25    election under this subsection (a) at the same time as the
26    election under Section 15-134.5 and within the timeframes

 

 

10000SB0016sam001- 162 -LRB100 05169 RPS 22680 a

1    required by that Section.
2    If a Tier 1 employee fails for any reason to make a
3required election under this subsection within the time
4specified, then the employee shall be deemed to have made the
5election under paragraph (2) of this subsection.
6    (a-5) If this Section is enjoined or stayed by an Illinois
7court or a court of competent jurisdiction pending the entry of
8a final and unappealable decision, and this Section is
9determined to be constitutional or otherwise valid by a final
10unappealable decision of an Illinois court or a court of
11competent jurisdiction, then the election procedure set forth
12in subsection (a) of this Section shall commence on the 180th
13calendar day after the date of the issuance of the final
14unappealable decision and shall conclude at the end of the
15270th calendar day after that date.
16    (a-10) All elections under subsection (a) that are made or
17deemed to be made before July 1, 2018 shall take effect on July
181, 2018. Elections that are made or deemed to be made on or
19after July 1, 2018 shall take effect on the first day of the
20month following the month in which the election is made or
21deemed to be made.
22    (b) 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,
25the employer shall be expressly and irrevocably prohibited from
26offering any future increases in income to a Tier 1 employee

 

 

10000SB0016sam001- 163 -LRB100 05169 RPS 22680 a

1who has made an election under paragraph (1) of subsection (a)
2of this Section on the condition of not constituting earnings
3under Section 15-111.
4    As adequate and legal consideration provided under this
5amendatory Act of the 100th General Assembly for making an
6election under paragraph (1) of subsection (a) of this Section,
7each Tier 1 employee who has made an election under paragraph
8(1) of subsection (a) of this Section shall receive a
9consideration payment equal to 10% of the contributions made by
10or on behalf of the employee under Section 15-157 before the
11effective date of that election. The State Comptroller shall
12pay the consideration payment to the Tier 1 employee out of
13funds appropriated for that purpose under Section 1.9 of the
14State Pension Funds Continuing Appropriation Act. The System
15shall calculate the amount of each consideration payment and,
16by July 1, 2018, shall certify to the State Comptroller the
17amount of the consideration payment, together with the name,
18address, and any other available payment information of the
19Tier 1 employee as found in the records of the System. The
20System shall make additional calculations and certifications
21of consideration payments to the State Comptroller as the
22System deems necessary.
23    (c) A Tier 1 employee who makes the election under
24paragraph (2) of subsection (a) of this Section shall not be
25subject to paragraph (1) of subsection (a) of this Section.
26However, each future increase in income offered by an employer

 

 

10000SB0016sam001- 164 -LRB100 05169 RPS 22680 a

1under this Article to a Tier 1 employee who has made the
2election under paragraph (2) of subsection (a) of this Section
3shall be offered by the employer expressly and irrevocably on
4the condition of not constituting earnings under Section 15-111
5and that the Tier 1 employee's acceptance of the offered future
6increase in income shall constitute his or her agreement to
7that condition.
8    (d) The System shall make a good faith effort to contact
9each Tier 1 employee subject to this Section. The System shall
10mail information describing the required election to each Tier
111 employee by United States Postal Service mail to his or her
12last known address on file with the System. If the Tier 1
13employee is not responsive to other means of contact, it is
14sufficient for the System to publish the details of any
15required elections on its website or to publish those details
16in a regularly published newsletter or other existing public
17forum.
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 System shall offer
22Tier 1 employees an opportunity to receive information from the
23System before making the required election. The information may
24consist of video materials, benefit estimators, group
25presentations, individual consultation with a member or
26authorized representative of the System in person or by

 

 

10000SB0016sam001- 165 -LRB100 05169 RPS 22680 a

1telephone or other electronic means, or any combination of
2these methods. The System shall not provide advice or
3counseling with respect to which election a Tier 1 employee
4should make or specific to the legal or tax circumstances of or
5consequences to the Tier 1 employee.
6    The System shall inform Tier 1 employees in the election
7packet required under this subsection that the Tier 1 employee
8may also wish to obtain information and counsel relating to the
9election required under this Section from any other available
10source, including, but not limited to, labor organizations and
11private counsel.
12    In no event shall the System, its staff, or the Board be
13held liable for any information given to a member regarding the
14elections under this Section. The System shall coordinate with
15the Illinois Department of Central Management Services and each
16other retirement system administering an election in
17accordance with this amendatory Act of the 100th General
18Assembly to provide information concerning the impact of the
19election set forth in this Section.
20    (e) Notwithstanding any other provision of law, an employer
21under this Article is required to offer each future increase in
22income expressly and irrevocably on the condition of not
23constituting "earnings" under Section 15-111 to any Tier 1
24employee who has made an election under paragraph (2) of
25subsection (a) of this Section. The offer shall also provide
26that the Tier 1 employee's acceptance of the offered future

 

 

10000SB0016sam001- 166 -LRB100 05169 RPS 22680 a

1increase in income shall constitute his or her agreement to the
2condition set forth in this subsection.
3    For purposes of legislative intent, the condition set forth
4in this subsection shall be construed in a manner that ensures
5that the condition is not violated or circumvented through any
6contrivance of any kind.
7    (f) A member's election under this Section is not a
8prohibited election under subdivision (j)(1) of Section 1-119
9of this Code.
10    (g) No provision of this Section shall be interpreted in a
11way that would cause the System to cease to be a qualified plan
12under Section 401(a) of the Internal Revenue Code of 1986.
13    (h) If an election created by this amendatory Act in any
14other Article of this Code or any change deriving from that
15election is determined to be unconstitutional or otherwise
16invalid by a final unappealable decision of an Illinois court
17or a court of competent jurisdiction, the invalidity of that
18provision shall not in any way affect the validity of this
19Section or the changes deriving from the election required
20under this Section.
 
21    (40 ILCS 5/15-136)  (from Ch. 108 1/2, par. 15-136)
22    (Text of Section WITHOUT the changes made by P.A. 98-599,
23which has been held unconstitutional)
24    Sec. 15-136. Retirement annuities - Amount. The provisions
25of this Section 15-136 apply only to those participants who are

 

 

10000SB0016sam001- 167 -LRB100 05169 RPS 22680 a

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

 

 

10000SB0016sam001- 168 -LRB100 05169 RPS 22680 a

1    15-113.6 and Section 15-113.7 plus 1.4 times all other
2    accumulated normal contributions made by the participant;
3    and
4        (iii) the annuity that can be provided on an
5    actuarially equivalent basis from the entire contribution
6    made by the participant under Section 15-113.3.
7    With respect to a police officer or firefighter who retires
8on or after August 14, 1998, the accumulated normal
9contributions taken into account under clauses (i) and (ii) of
10this Rule 2 shall include the additional normal contributions
11made by the police officer or firefighter under Section
1215-157(a).
13    The amount of a retirement annuity calculated under this
14Rule 2 shall be computed solely on the basis of the
15participant's accumulated normal contributions, as specified
16in this Rule and defined in Section 15-116. Neither an employee
17or employer contribution for early retirement under Section
1815-136.2 nor any other employer contribution shall be used in
19the calculation of the amount of a retirement annuity under
20this Rule 2.
21    This amendatory Act of the 91st General Assembly is a
22clarification of existing law and applies to every participant
23and annuitant without regard to whether status as an employee
24terminates before the effective date of this amendatory Act.
25    This Rule 2 does not apply to a person who first becomes an
26employee under this Article on or after July 1, 2005.

 

 

10000SB0016sam001- 169 -LRB100 05169 RPS 22680 a

1    Rule 3: The retirement annuity of a participant who is
2employed at least one-half time during the period on which his
3or her final rate of earnings is based, shall be equal to the
4participant's years of service not to exceed 30, multiplied by
5(1) $96 if the participant's final rate of earnings is less
6than $3,500, (2) $108 if the final rate of earnings is at least
7$3,500 but less than $4,500, (3) $120 if the final rate of
8earnings is at least $4,500 but less than $5,500, (4) $132 if
9the final rate of earnings is at least $5,500 but less than
10$6,500, (5) $144 if the final rate of earnings is at least
11$6,500 but less than $7,500, (6) $156 if the final rate of
12earnings is at least $7,500 but less than $8,500, (7) $168 if
13the final rate of earnings is at least $8,500 but less than
14$9,500, and (8) $180 if the final rate of earnings is $9,500 or
15more, except that the annuity for those persons having made an
16election under Section 15-154(a-1) shall be calculated and
17payable under the portable retirement benefit program pursuant
18to the provisions of Section 15-136.4.
19    Rule 4: A participant who is at least age 50 and has 25 or
20more years of service as a police officer or firefighter, and a
21participant who is age 55 or over and has at least 20 but less
22than 25 years of service as a police officer or firefighter,
23shall be entitled to a retirement annuity of 2 1/4% of the
24final rate of earnings for each of the first 10 years of
25service as a police officer or firefighter, 2 1/2% for each of
26the next 10 years of service as a police officer or

 

 

10000SB0016sam001- 170 -LRB100 05169 RPS 22680 a

1firefighter, and 2 3/4% for each year of service as a police
2officer or firefighter in excess of 20. The retirement annuity
3for all other service shall be computed under Rule 1. A Tier 2
4member is eligible for a retirement annuity calculated under
5Rule 4 only if that Tier 2 member meets the service
6requirements for that benefit calculation as prescribed under
7this Rule 4 in addition to the applicable age requirement under
8subsection (a-5) of Section 15-135.
9    For purposes of this Rule 4, a participant's service as a
10firefighter shall also include the following:
11        (i) service that is performed while the person is an
12    employee under subsection (h) of Section 15-107; and
13        (ii) in the case of an individual who was a
14    participating employee employed in the fire department of
15    the University of Illinois's Champaign-Urbana campus
16    immediately prior to the elimination of that fire
17    department and who immediately after the elimination of
18    that fire department transferred to another job with the
19    University of Illinois, service performed as an employee of
20    the University of Illinois in a position other than police
21    officer or firefighter, from the date of that transfer
22    until the employee's next termination of service with the
23    University of Illinois.
24    (b) For a Tier 1 member, the retirement annuity provided
25under Rules 1 and 3 above shall be reduced by 1/2 of 1% for each
26month the participant is under age 60 at the time of

 

 

10000SB0016sam001- 171 -LRB100 05169 RPS 22680 a

1retirement. However, this reduction shall not apply in the
2following cases:
3        (1) For a disabled participant whose disability
4    benefits have been discontinued because he or she has
5    exhausted eligibility for disability benefits under clause
6    (6) of Section 15-152;
7        (2) For a participant who has at least the number of
8    years of service required to retire at any age under
9    subsection (a) of Section 15-135; or
10        (3) For that portion of a retirement annuity which has
11    been provided on account of service of the participant
12    during periods when he or she performed the duties of a
13    police officer or firefighter, if these duties were
14    performed for at least 5 years immediately preceding the
15    date the retirement annuity is to begin.
16    (b-5) The retirement annuity of a Tier 2 member who is
17retiring after attaining age 62 with at least 10 years of
18service credit shall be reduced by 1/2 of 1% for each full
19month that the member's age is under age 67.
20    (c) The maximum retirement annuity provided under Rules 1,
212, 4, and 5 shall be the lesser of (1) the annual limit of
22benefits as specified in Section 415 of the Internal Revenue
23Code of 1986, as such Section may be amended from time to time
24and as such benefit limits shall be adjusted by the
25Commissioner of Internal Revenue, and (2) 80% of final rate of
26earnings.

 

 

10000SB0016sam001- 172 -LRB100 05169 RPS 22680 a

1    (d) Subject to the provisions of subsection (d-1), a A Tier
21 member whose status as an employee terminates after August
314, 1969 shall receive automatic increases in his or her
4retirement annuity as follows:
5    Effective January 1 immediately following the date the
6retirement annuity begins, the annuitant shall receive an
7increase in his or her monthly retirement annuity of 0.125% of
8the monthly retirement annuity provided under Rule 1, Rule 2,
9Rule 3, or Rule 4 contained in this Section, multiplied by the
10number of full months which elapsed from the date the
11retirement annuity payments began to January 1, 1972, plus
120.1667% of such annuity, multiplied by the number of full
13months which elapsed from January 1, 1972, or the date the
14retirement annuity payments began, whichever is later, to
15January 1, 1978, plus 0.25% of such annuity multiplied by the
16number of full months which elapsed from January 1, 1978, or
17the date the retirement annuity payments began, whichever is
18later, to the effective date of the increase.
19    The annuitant shall receive an increase in his or her
20monthly retirement annuity on each January 1 thereafter during
21the annuitant's life of 3% of the monthly annuity provided
22under Rule 1, Rule 2, Rule 3, or Rule 4 contained in this
23Section. The change made under this subsection by P.A. 81-970
24is effective January 1, 1980 and applies to each annuitant
25whose status as an employee terminates before or after that
26date.

 

 

10000SB0016sam001- 173 -LRB100 05169 RPS 22680 a

1    Beginning January 1, 1990, and except as provided in
2subsection (d-1), all automatic annual increases payable under
3this Section shall be calculated as a percentage of the total
4annuity payable at the time of the increase, including all
5increases previously granted under this Article.
6    The change made in this subsection by P.A. 85-1008 is
7effective January 26, 1988, and is applicable without regard to
8whether status as an employee terminated before that date.
9    (d-1) Notwithstanding any other provision of this Article,
10for a Tier 1 employee who made the election under paragraph (1)
11of subsection (a) of Section 15-132.9:
12        (1) The initial increase in retirement annuity under
13    this Section shall occur on the January 1 occurring either
14    on or after the attainment of age 67 or the fifth
15    anniversary of the annuity start date, whichever is
16    earlier.
17        (2) The amount of each automatic annual increase in
18    retirement annuity or survivor annuity occurring on or
19    after the effective date of that election shall be
20    calculated as a percentage of the originally granted
21    retirement annuity or survivor annuity, equal to 3% or
22    one-half the annual unadjusted percentage increase (but
23    not less than zero) in the consumer price index-u for the
24    12 months ending with the September preceding each November
25    1, whichever is less. If the annual unadjusted percentage
26    change in the consumer price index-u for the 12 months

 

 

10000SB0016sam001- 174 -LRB100 05169 RPS 22680 a

1    ending with the September preceding each November 1 is zero
2    or there is a decrease, then the annuity shall not be
3    increased.
4    For the purposes of this Section, "consumer price index-u"
5means the index published by the Bureau of Labor Statistics of
6the United States Department of Labor that measures the average
7change in prices of goods and services purchased by all urban
8consumers, United States city average, all items, 1982-84 =
9100. The new amount resulting from each annual adjustment shall
10be determined by the Public Pension Division of the Department
11of Insurance and made available to the board of the retirement
12system by November 1 of each year.
13    (d-5) A retirement annuity of a Tier 2 member shall receive
14annual increases on the January 1 occurring either on or after
15the attainment of age 67 or the first anniversary of the
16annuity start date, whichever is later. Each annual increase
17shall be calculated at 3% or one half the annual unadjusted
18percentage increase (but not less than zero) in the consumer
19price index-u for the 12 months ending with the September
20preceding each November 1, whichever is less, of the originally
21granted retirement annuity. If the annual unadjusted
22percentage change in the consumer price index-u for the 12
23months ending with the September preceding each November 1 is
24zero or there is a decrease, then the annuity shall not be
25increased.
26    (e) If, on January 1, 1987, or the date the retirement

 

 

10000SB0016sam001- 175 -LRB100 05169 RPS 22680 a

1annuity payment period begins, whichever is later, the sum of
2the retirement annuity provided under Rule 1 or Rule 2 of this
3Section and the automatic annual increases provided under the
4preceding subsection or Section 15-136.1, amounts to less than
5the retirement annuity which would be provided by Rule 3, the
6retirement annuity shall be increased as of January 1, 1987, or
7the date the retirement annuity payment period begins,
8whichever is later, to the amount which would be provided by
9Rule 3 of this Section. Such increased amount shall be
10considered as the retirement annuity in determining benefits
11provided under other Sections of this Article. This paragraph
12applies without regard to whether status as an employee
13terminated before the effective date of this amendatory Act of
141987, provided that the annuitant was employed at least
15one-half time during the period on which the final rate of
16earnings was based.
17    (f) A participant is entitled to such additional annuity as
18may be provided on an actuarially equivalent basis, by any
19accumulated additional contributions to his or her credit.
20However, the additional contributions made by the participant
21toward the automatic increases in annuity provided under this
22Section shall not be taken into account in determining the
23amount of such additional annuity.
24    (g) If, (1) by law, a function of a governmental unit, as
25defined by Section 20-107 of this Code, is transferred in whole
26or in part to an employer, and (2) a participant transfers

 

 

10000SB0016sam001- 176 -LRB100 05169 RPS 22680 a

1employment from such governmental unit to such employer within
26 months after the transfer of the function, and (3) the sum of
3(A) the annuity payable to the participant under Rule 1, 2, or
43 of this Section (B) all proportional annuities payable to the
5participant by all other retirement systems covered by Article
620, and (C) the initial primary insurance amount to which the
7participant is entitled under the Social Security Act, is less
8than the retirement annuity which would have been payable if
9all of the participant's pension credits validated under
10Section 20-109 had been validated under this system, a
11supplemental annuity equal to the difference in such amounts
12shall be payable to the participant.
13    (h) On January 1, 1981, an annuitant who was receiving a
14retirement annuity on or before January 1, 1971 shall have his
15or her retirement annuity then being paid increased $1 per
16month for each year of creditable service. On January 1, 1982,
17an annuitant whose retirement annuity began on or before
18January 1, 1977, shall have his or her retirement annuity then
19being paid increased $1 per month for each year of creditable
20service.
21    (i) On January 1, 1987, any annuitant whose retirement
22annuity began on or before January 1, 1977, shall have the
23monthly retirement annuity increased by an amount equal to 8
24per year of creditable service times the number of years that
25have elapsed since the annuity began.
26(Source: P.A. 97-933, eff. 8-10-12; 97-968, eff. 8-16-12;

 

 

10000SB0016sam001- 177 -LRB100 05169 RPS 22680 a

198-92, eff. 7-16-13.)
 
2    (40 ILCS 5/15-155)  (from Ch. 108 1/2, par. 15-155)
3    Sec. 15-155. Employer contributions.
4    (a) The State of Illinois shall make contributions by
5appropriations of amounts which, together with the other
6employer contributions from trust, federal, and other funds,
7employee contributions, income from investments, and other
8income of this System, will be sufficient to meet the cost of
9maintaining and administering the System on a 90% funded basis
10in accordance with actuarial recommendations.
11    The Board shall determine the amount of State contributions
12required for each fiscal year on the basis of the actuarial
13tables and other assumptions adopted by the Board and the
14recommendations of the actuary, using the formula in subsection
15(a-1).
16    (a-1) For State fiscal years 2018 through 2045 (except as
17otherwise provided for fiscal year 2019), the minimum
18contribution to the System to be made by the State for each
19fiscal year shall be an amount determined by the System to be
20sufficient to bring the total assets of the System up to 90% of
21the total actuarial liabilities of the System by the end of
22State fiscal year 2045. In making these determinations, the
23required State contribution shall be calculated each year as a
24level percentage of total payroll, including payroll that is
25not deemed pensionable, but excluding payroll attributable to

 

 

10000SB0016sam001- 178 -LRB100 05169 RPS 22680 a

1participants in the defined contribution plan under Section
215-200.1, over the years remaining to and including fiscal year
32045 and shall be determined under the projected unit credit
4actuarial cost method.
5    For State fiscal year 2019:
6        (1) The initial calculation and certification shall be
7    based on the amount determined above.
8        (2) For purposes of the recertification due on or
9    before May 1, 2018, the recalculation of the required State
10    contribution for fiscal year 2019 shall take into account
11    the effect on the System's liabilities of the elections
12    made under Section 15-132.9.
13        (3) For purposes of the recertification due on or
14    before October 1, 2018, the total required State
15    contribution for fiscal year 2019 shall be reduced by the
16    amount of the consideration payments made to Tier 1
17    employees who made the election under paragraph (1) of
18    subsection (a) of Section 15-132.9.
19    Beginning in State fiscal year 2018, any increase or
20decrease in State contribution over the prior fiscal year due
21exclusively to changes in actuarial or investment assumptions
22adopted by the Board shall be included in the State
23contribution to the System, as a percentage of the applicable
24employee payroll, and shall be increased in equal annual
25increments so that by the State fiscal year occurring 5 years
26after the adoption of the actuarial or investment assumptions,

 

 

10000SB0016sam001- 179 -LRB100 05169 RPS 22680 a

1the State is contributing at the rate otherwise required under
2this Section.
3    For State fiscal years 2012 through 2017 2045, the minimum
4contribution to the System to be made by the State for each
5fiscal year shall be an amount determined by the System to be
6sufficient to bring the total assets of the System up to 90% of
7the total actuarial liabilities of the System by the end of
8State fiscal year 2045. In making these determinations, the
9required State contribution shall be calculated each year as a
10level percentage of payroll over the years remaining to and
11including fiscal year 2045 and shall be determined under the
12projected unit credit actuarial cost method.
13    For State fiscal years 1996 through 2005, the State
14contribution to the System, as a percentage of the applicable
15employee payroll, shall be increased in equal annual increments
16so that by State fiscal year 2011, the State is contributing at
17the rate required under this Section.
18    Notwithstanding any other provision of this Article, the
19total required State contribution for State fiscal year 2006 is
20$166,641,900.
21    Notwithstanding any other provision of this Article, the
22total required State contribution for State fiscal year 2007 is
23$252,064,100.
24    For each of State fiscal years 2008 through 2009, the State
25contribution to the System, as a percentage of the applicable
26employee payroll, shall be increased in equal annual increments

 

 

10000SB0016sam001- 180 -LRB100 05169 RPS 22680 a

1from the required State contribution for State fiscal year
22007, so that by State fiscal year 2011, the State is
3contributing at the rate otherwise required under this Section.
4    Notwithstanding any other provision of this Article, the
5total required State contribution for State fiscal year 2010 is
6$702,514,000 and shall be made from the State Pensions Fund and
7proceeds of bonds sold in fiscal year 2010 pursuant to Section
87.2 of the General Obligation Bond Act, less (i) the pro rata
9share of bond sale expenses determined by the System's share of
10total bond proceeds, (ii) any amounts received from the General
11Revenue Fund in fiscal year 2010, (iii) any reduction in bond
12proceeds due to the issuance of discounted bonds, if
13applicable.
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 Section 15-165 and shall be made from the State
18Pensions Fund and proceeds of bonds sold in fiscal year 2011
19pursuant to Section 7.2 of the General Obligation Bond Act,
20less (i) the pro rata share of bond sale expenses determined by
21the System's share of total bond proceeds, (ii) any amounts
22received from the General Revenue Fund in fiscal year 2011, and
23(iii) any reduction in bond proceeds due to the issuance of
24discounted bonds, if applicable.
25    Beginning in State fiscal year 2046, the minimum State
26contribution for each fiscal year shall be the amount needed to

 

 

10000SB0016sam001- 181 -LRB100 05169 RPS 22680 a

1maintain the total assets of the System at 90% of the total
2actuarial liabilities of the System.
3    Amounts received by the System pursuant to Section 25 of
4the Budget Stabilization Act or Section 8.12 of the State
5Finance Act in any fiscal year do not reduce and do not
6constitute payment of any portion of the minimum State
7contribution required under this Article in that fiscal year.
8Such amounts shall not reduce, and shall not be included in the
9calculation of, the required State contributions under this
10Article in any future year until the System has reached a
11funding ratio of at least 90%. A reference in this Article to
12the "required State contribution" or any substantially similar
13term does not include or apply to any amounts payable to the
14System under Section 25 of the Budget Stabilization Act.
15    Notwithstanding any other provision of this Section, the
16required State contribution for State fiscal year 2005 and for
17fiscal year 2008 and each fiscal year thereafter, as calculated
18under this Section and certified under Section 15-165, shall
19not exceed an amount equal to (i) the amount of the required
20State contribution that would have been calculated under this
21Section for that fiscal year if the System had not received any
22payments under subsection (d) of Section 7.2 of the General
23Obligation Bond Act, minus (ii) the portion of the State's
24total debt service payments for that fiscal year on the bonds
25issued in fiscal year 2003 for the purposes of that Section
267.2, as determined and certified by the Comptroller, that is

 

 

10000SB0016sam001- 182 -LRB100 05169 RPS 22680 a

1the same as the System's portion of the total moneys
2distributed under subsection (d) of Section 7.2 of the General
3Obligation Bond Act. In determining this maximum for State
4fiscal years 2008 through 2010, however, the amount referred to
5in item (i) shall be increased, as a percentage of the
6applicable employee payroll, in equal increments calculated
7from the sum of the required State contribution for State
8fiscal year 2007 plus the applicable portion of the State's
9total debt service payments for fiscal year 2007 on the bonds
10issued in fiscal year 2003 for the purposes of Section 7.2 of
11the General Obligation Bond Act, so that, by State fiscal year
122011, the State is contributing at the rate otherwise required
13under this Section.
14     (a-2) For employees first hired on or after 6 months after
15the effective date of this amendatory Act of the 100th General
16Assembly who have elected the benefits under Section 1-161 of
17this Code, the employer shall annually contribute an amount,
18expressed as a percentage of payroll, equal to the defined
19benefit normal cost of the defined benefit plan, less the
20employee contribution, plus 2%. On an annual basis, the System
21shall certify to each employer the amount of unfunded liability
22accrued in the employer's account to be paid by the employer so
23that the System is 90% funded by the end of State fiscal year
242045. The contributions shall be divided equally over a
2512-month period and made monthly. The employer shall also
26contribute an amount equal to the employer defined

 

 

10000SB0016sam001- 183 -LRB100 05169 RPS 22680 a

1contribution, as set on an individual employee basis, under
2paragraph (2) of subsection (k) of Section 1-161 during each
3pay period. The System shall have the authority to adopt rules
4regarding implementation of employer contributions.
5    (b) If an employee is paid from trust or federal funds, the
6employer shall pay to the Board contributions from those funds
7which are sufficient to cover the accruing normal costs on
8behalf of the employee. However, universities having employees
9who are compensated out of local auxiliary funds, income funds,
10or service enterprise funds are not required to pay such
11contributions on behalf of those employees. The local auxiliary
12funds, income funds, and service enterprise funds of
13universities shall not be considered trust funds for the
14purpose of this Article, but funds of alumni associations,
15foundations, and athletic associations which are affiliated
16with the universities included as employers under this Article
17and other employers which do not receive State appropriations
18are considered to be trust funds for the purpose of this
19Article.
20    (b-1) The City of Urbana and the City of Champaign shall
21each make employer contributions to this System for their
22respective firefighter employees who participate in this
23System pursuant to subsection (h) of Section 15-107. The rate
24of contributions to be made by those municipalities shall be
25determined annually by the Board on the basis of the actuarial
26assumptions adopted by the Board and the recommendations of the

 

 

10000SB0016sam001- 184 -LRB100 05169 RPS 22680 a

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

 

 

10000SB0016sam001- 185 -LRB100 05169 RPS 22680 a

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

 

 

10000SB0016sam001- 186 -LRB100 05169 RPS 22680 a

1under this subsection (g), the System shall calculate the
2amount of the payment and bill the employer for that amount.
3The bill shall specify the calculations used to determine the
4amount due. If the employer disputes the amount of the bill, it
5may, within 30 days after receipt of the bill, apply to the
6System in writing for a recalculation. The application must
7specify in detail the grounds of the dispute and, if the
8employer asserts that the calculation is subject to subsection
9(h) or (i) of this Section, must include an affidavit setting
10forth and attesting to all facts within the employer's
11knowledge that are pertinent to the applicability of subsection
12(h) or (i). Upon receiving a timely application for
13recalculation, the System shall review the application and, if
14appropriate, recalculate the amount due.
15    The employer contributions required under this subsection
16(g) may be paid in the form of a lump sum within 90 days after
17receipt of the bill. If the employer contributions are not paid
18within 90 days after receipt of the bill, then interest will be
19charged at a rate equal to the System's annual actuarially
20assumed rate of return on investment compounded annually from
21the 91st day after receipt of the bill. Payments must be
22concluded within 3 years after the employer's receipt of the
23bill.
24    When assessing payment for any amount due under this
25subsection (g), the System shall include earnings, to the
26extent not established by a participant under Section 15-113.11

 

 

10000SB0016sam001- 187 -LRB100 05169 RPS 22680 a

1or 15-113.12, that would have been paid to the participant had
2the participant not taken (i) periods of voluntary or
3involuntary furlough occurring on or after July 1, 2015 and on
4or before June 30, 2017 or (ii) periods of voluntary pay
5reduction in lieu of furlough occurring on or after July 1,
62015 and on or before June 30, 2017. Determining earnings that
7would have been paid to a participant had the participant not
8taken periods of voluntary or involuntary furlough or periods
9of voluntary pay reduction shall be the responsibility of the
10employer, and shall be reported in a manner prescribed by the
11System.
12    (g-1) For academic years beginning on or after July 1,
132018, if the amount of a participant's earnings for any
14academic year used to determine the final rate of earnings,
15determined on a full-time equivalent basis, exceeds the amount
16of his or her earnings with the same employer for the previous
17academic year, determined on a full-time equivalent basis, by
18more than the unadjusted percentage increase in the consumer
19price index-u for the calendar year immediately preceding the
20beginning of the academic year, published by the Public Pension
21Division of the Department of Insurance by November 1 of each
22year, then the participant's employer shall pay to the System,
23in addition to all other payments required under this Section
24and in accordance with guidelines established by the System,
25the present value of the increase in benefits resulting from
26the portion of the increase in earnings that is in excess of

 

 

10000SB0016sam001- 188 -LRB100 05169 RPS 22680 a

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

 

 

10000SB0016sam001- 189 -LRB100 05169 RPS 22680 a

1be charged at a rate equal to the System's annual actuarially
2assumed rate of return on investment compounded annually from
3the 91st day after receipt of the bill. Payments must be
4concluded within 3 years after the employer's receipt of the
5bill.
6    For the purposes of this Section, "consumer price index-u"
7means the index published by the Bureau of Labor Statistics of
8the United States Department of Labor that measures the average
9change in prices of goods and services purchased by all urban
10consumers, United States city average, all items, 1982-84 =
11100. The new amount resulting from each annual adjustment shall
12be determined by the Public Pension Division of the Department
13of Insurance and made available to the boards of the retirement
14systems and pension funds by November 1 of each year.
15    (h) This subsection (h) applies only to payments made or
16salary increases given on or after June 1, 2005 but before July
171, 2011. The changes made by Public Act 94-1057 shall not
18require the System to refund any payments received before July
1931, 2006 (the effective date of Public Act 94-1057).
20    When assessing payment for any amount due under subsection
21(g), the System shall exclude earnings increases paid to
22participants under contracts or collective bargaining
23agreements entered into, amended, or renewed before June 1,
242005.
25    When assessing payment for any amount due under subsection
26(g), the System shall exclude earnings increases paid to a

 

 

10000SB0016sam001- 190 -LRB100 05169 RPS 22680 a

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

 

 

10000SB0016sam001- 191 -LRB100 05169 RPS 22680 a

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

 

 

10000SB0016sam001- 192 -LRB100 05169 RPS 22680 a

1        (2) The dollar amount by which each employer's
2    contribution to the System was changed due to
3    recalculations required by Public Act 94-1057.
4        (3) The total amount the System received from each
5    employer as a result of the changes made to this Section by
6    Public Act 94-4.
7        (4) The increase in the required State contribution
8    resulting from the changes made to this Section by Public
9    Act 94-1057.
10    (j-5) For academic years beginning on or after July 1,
112018, if the amount of a participant's earnings for any
12academic year, determined on a full-time equivalent basis,
13exceeds $140,000, the participant's employer shall pay to the
14System, in addition to all other payments required under this
15Section and in accordance with guidelines established by the
16System, the amount of the earnings that exceed $140,000
17multiplied by the level percentage of payroll used in that
18fiscal year, as determined by the System, to be sufficient to
19bring the total assets of the System up to 90% of the total
20actuarial liabilities of the System by the end of State fiscal
21year 2045. This amount shall be computed by the System on the
22basis of the actuarial assumptions and tables used in the most
23recent actuarial valuation of the System that is available at
24the time of the computation. The System may require the
25employer to provide any pertinent information or
26documentation.

 

 

10000SB0016sam001- 193 -LRB100 05169 RPS 22680 a

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

 

 

10000SB0016sam001- 194 -LRB100 05169 RPS 22680 a

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

 

 

10000SB0016sam001- 195 -LRB100 05169 RPS 22680 a

1jurisdiction, then the changes made to this Section by this
2amendatory Act of the 100th General Assembly shall not take
3effect and are repealed by operation of law.
4(Source: P.A. 98-92, eff. 7-16-13; 98-463, eff. 8-16-13;
599-897, eff. 1-1-17.)
 
6    (40 ILCS 5/15-157)  (from Ch. 108 1/2, par. 15-157)
7    Sec. 15-157. Employee Contributions.
8    (a) Each participating employee shall make contributions
9towards the retirement benefits payable under the retirement
10program applicable to the employee from each payment of
11earnings applicable to employment under this system on and
12after the date of becoming a participant as follows: Prior to
13September 1, 1949, 3 1/2% of earnings; from September 1, 1949
14to August 31, 1955, 5%; from September 1, 1955 to August 31,
151969, 6%; from September 1, 1969, 6 1/2%. These contributions
16are to be considered as normal contributions for purposes of
17this Article.
18    Each participant who is a police officer or firefighter
19shall make normal contributions of 8% of each payment of
20earnings applicable to employment as a police officer or
21firefighter under this system on or after September 1, 1981,
22unless he or she files with the board within 60 days after the
23effective date of this amendatory Act of 1991 or 60 days after
24the board receives notice that he or she is employed as a
25police officer or firefighter, whichever is later, a written

 

 

10000SB0016sam001- 196 -LRB100 05169 RPS 22680 a

1notice waiving the retirement formula provided by Rule 4 of
2Section 15-136. This waiver shall be irrevocable. If a
3participant had met the conditions set forth in Section
415-132.1 prior to the effective date of this amendatory Act of
51991 but failed to make the additional normal contributions
6required by this paragraph, he or she may elect to pay the
7additional contributions plus compound interest at the
8effective rate. If such payment is received by the board, the
9service shall be considered as police officer service in
10calculating the retirement annuity under Rule 4 of Section
1115-136. While performing service described in clause (i) or
12(ii) of Rule 4 of Section 15-136, a participating employee
13shall be deemed to be employed as a firefighter for the purpose
14of determining the rate of employee contributions under this
15Section.
16    (b) Starting September 1, 1969, each participating
17employee shall make additional contributions of 1/2 of 1% of
18earnings to finance a portion of the cost of the annual
19increases in retirement annuity provided under Section 15-136,
20except that with respect to participants in the self-managed
21plan this additional contribution shall be used to finance the
22benefits obtained under that retirement program. Beginning
23July 1, 2018 or the effective date of the Tier 1 employee's
24election under paragraph (1) of subsection (a) of Section
2515-132.9, whichever is later, each Tier 1 employee who made the
26election under paragraph (1) of subsection (a) of Section

 

 

10000SB0016sam001- 197 -LRB100 05169 RPS 22680 a

115-132.9 is no longer required to make contributions under this
2subsection.
3    (c) Except as provided in subsection (c-5), in In addition
4to the amounts described in subsections (a) and (b) of this
5Section, each participating employee shall make contributions
6of 1% of earnings applicable under this system on and after
7August 1, 1959. The contributions made under this subsection
8(c) shall be considered as survivor's insurance contributions
9for purposes of this Article if the employee is covered under
10the traditional benefit package, and such contributions shall
11be considered as additional contributions for purposes of this
12Article if the employee is participating in the self-managed
13plan or has elected to participate in the portable benefit
14package and has completed the applicable one-year waiting
15period. Contributions in excess of $80 during any fiscal year
16beginning before August 31, 1969 and in excess of $120 during
17any fiscal year thereafter until September 1, 1971 shall be
18considered as additional contributions for purposes of this
19Article.
20    (c-5) Beginning July 1, 2018 or the effective date of the
21Tier 1 employee's election under paragraph (1) of subsection
22(a) of Section 15-132.9, whichever is later, in lieu of the
23contributions otherwise required under subsection (c), each
24Tier 1 employee who made the election under paragraph (1) of
25subsection (a) of Section 15-132.9 shall make contributions of
260.7% of earnings applicable under this System and each Tier 1

 

 

10000SB0016sam001- 198 -LRB100 05169 RPS 22680 a

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

 

 

10000SB0016sam001- 199 -LRB100 05169 RPS 22680 a

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

 

 

10000SB0016sam001- 200 -LRB100 05169 RPS 22680 a

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

 

 

10000SB0016sam001- 201 -LRB100 05169 RPS 22680 a

1assumptions, calculations, and data upon which that proposed
2certification is based. On or before January 1 of each year,
3beginning January 1, 2013, the State Actuary shall issue a
4preliminary report concerning the proposed certification and
5identifying, if necessary, recommended changes in actuarial
6assumptions that the Board must consider before finalizing its
7certification of the required State contributions. On or before
8January 15, 2013 and each January 15 thereafter, the Board
9shall certify to the Governor and the General Assembly the
10amount of the required State contribution for the next fiscal
11year. The Board's certification must note, in a written
12response to the State Actuary, any deviations from the State
13Actuary's recommended changes, the reason or reasons for not
14following the State Actuary's recommended changes, and the
15fiscal impact of not following the State Actuary's recommended
16changes on the required State contribution.
17    (a-10) For purposes of subsection (c-5) of Section 20 of
18the Budget Stabilization Act, on or before November 1 of each
19year beginning November 1, 2019, the Board shall determine the
20amount of the State contribution to the System that would have
21been required for the next fiscal year if Section 1-161,
22subsection (a-2) of Section 15-155, and the changes made to
23Section 1-160 by this amendatory Act of the 100th General
24Assembly had not taken effect, using the best and most recent
25available data but based on the law in effect on May 31, 2019.
26The Board shall submit to the State Actuary, the Governor, and

 

 

10000SB0016sam001- 202 -LRB100 05169 RPS 22680 a

1the General Assembly a proposed certification, along with the
2relevant law, actuarial assumptions, calculations, and data
3upon which that certification is based. On or before January 1,
42020 and every January 1 thereafter, the State Actuary shall
5issue a preliminary report concerning the proposed
6certification and identifying, if necessary, recommended
7changes in actuarial assumptions that the Board must consider
8before finalizing its certification. On or before January 15,
92020 and every January 1 thereafter, the Board shall certify to
10the Governor and the General Assembly the amount of the State
11contribution to the System that would have been required for
12the next fiscal year if Section 1-161, subsection (a-2) of
13Section 15-155, and the changes made to Section 1-160 by this
14amendatory Act of the 100th General Assembly had not taken
15effect, using the best and most recent available data but based
16on the law in effect on May 31, 2019. The Board's certification
17must note any deviations from the State Actuary's recommended
18changes, the reason or reasons for not following the State
19Actuary's recommended changes, and the impact of not following
20the State Actuary's recommended changes.
21    (a-15) As soon as practical after the effective date of
22this amendatory Act of the 100th General Assembly, the Board
23shall recalculate and recertify to the State Actuary, the
24Governor, and the General Assembly the amount of the State
25contribution to the System for State fiscal year 2018, taking
26into account the changes in required State contributions made

 

 

10000SB0016sam001- 203 -LRB100 05169 RPS 22680 a

1by this amendatory Act of the 100th General Assembly. The State
2Actuary shall review the assumptions and valuations underlying
3the Board's revised certification and issue a preliminary
4report concerning the proposed recertification and
5identifying, if necessary, recommended changes in actuarial
6assumptions that the Board must consider before finalizing its
7certification of the required State contributions. The Board's
8final certification must note any deviations from the State
9Actuary's recommended changes, the reason or reasons for not
10following the State Actuary's recommended changes, and the
11fiscal impact of not following the State Actuary's recommended
12changes on the required State contribution.
13    (a-20) On or before May 1, 2018, the Board shall
14recalculate and recertify to the Governor and the General
15Assembly the amount of the required State contribution to the
16System for State fiscal year 2019, taking into account the
17effect on the System's liabilities of the elections made under
18Section 15-132.9.
19    On or before October 1, 2018, the Board shall recalculate
20and recertify to the Governor and the General Assembly the
21amount of the required State contribution to the System for
22State fiscal year 2019, taking into account the reduction
23specified under item (3) of subsection (a-1) of Section 15-155.
24    (b) The Board shall certify to the State Comptroller or
25employer, as the case may be, from time to time, by its
26chairperson and secretary, with its seal attached, the amounts

 

 

10000SB0016sam001- 204 -LRB100 05169 RPS 22680 a

1payable to the System from the various funds.
2    (c) Beginning in State fiscal year 1996, on or as soon as
3possible after the 15th day of each month the Board shall
4submit vouchers for payment of State contributions to the
5System, in a total monthly amount of one-twelfth of the
6required annual State contribution certified under subsection
7(a). From the effective date of this amendatory Act of the 93rd
8General Assembly through June 30, 2004, the Board shall not
9submit vouchers for the remainder of fiscal year 2004 in excess
10of the fiscal year 2004 certified contribution amount
11determined under this Section after taking into consideration
12the transfer to the System under subsection (b) of Section
136z-61 of the State Finance Act. These vouchers shall be paid by
14the State Comptroller and Treasurer by warrants drawn on the
15funds appropriated to the System for that fiscal year.
16    If in any month the amount remaining unexpended from all
17other appropriations to the System for the applicable fiscal
18year (including the appropriations to the System under Section
198.12 of the State Finance Act and Section 1 of the State
20Pension Funds Continuing Appropriation Act) is less than the
21amount lawfully vouchered under this Section, the difference
22shall be paid from the General Revenue Fund under the
23continuing appropriation authority provided in Section 1.1 of
24the State Pension Funds Continuing Appropriation Act.
25    (d) So long as the payments received are the full amount
26lawfully vouchered under this Section, payments received by the

 

 

10000SB0016sam001- 205 -LRB100 05169 RPS 22680 a

1System under this Section shall be applied first toward the
2employer contribution to the self-managed plan established
3under Section 15-158.2. Payments shall be applied second toward
4the employer's portion of the normal costs of the System, as
5defined in subsection (f) of Section 15-155. The balance shall
6be applied toward the unfunded actuarial liabilities of the
7System.
8    (e) In the event that the System does not receive, as a
9result of legislative enactment or otherwise, payments
10sufficient to fully fund the employer contribution to the
11self-managed plan established under Section 15-158.2 and to
12fully fund that portion of the employer's portion of the normal
13costs of the System, as calculated in accordance with Section
1415-155(a-1), then any payments received shall be applied
15proportionately to the optional retirement program established
16under Section 15-158.2 and to the employer's portion of the
17normal costs of the System, as calculated in accordance with
18Section 15-155(a-1).
19(Source: P.A. 97-694, eff. 6-18-12; 98-92, eff. 7-16-13.)
 
20    (40 ILCS 5/15-185.5 new)
21    Sec. 15-185.5. Accelerated pension benefit payment.
22    (a) As used in this Section:
23    "Eligible person" means a person who:
24        (1) has terminated service;
25        (2) has accrued sufficient service credit to be

 

 

10000SB0016sam001- 206 -LRB100 05169 RPS 22680 a

1    eligible to receive a retirement annuity under this
2    Article;
3        (3) has not received any retirement annuity under this
4    Article;
5        (4) does not have a QILDRO in effect against him or her
6    under this Article; and
7        (5) is not a participant in the self-managed plan under
8    Section 15-158.2.
9    "Pension benefit" means the benefits under this Article, or
10Article 1 as it relates to those benefits, including any
11anticipated annual increases, that an eligible person is
12entitled to upon attainment of the applicable retirement age.
13"Pension benefit" also includes applicable survivor's or
14disability benefits.
15    (b) Before January 1, 2018, and annually thereafter, the
16System shall calculate, using actuarial tables and other
17assumptions adopted by the Board, the net present value of
18pension benefits for each eligible person and shall offer each
19eligible person the opportunity to irrevocably elect to receive
20an amount determined by the System to be equal to 70% of the
21net present value of his or her pension benefits in lieu of
22receiving any pension benefit. The offer shall specify the
23dollar amount that the eligible person will receive if he or
24she so elects and shall expire when a subsequent offer is made
25to an eligible person or when the System determines that 10% of
26eligible persons in that year have made the election under this

 

 

10000SB0016sam001- 207 -LRB100 05169 RPS 22680 a

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

 

 

10000SB0016sam001- 208 -LRB100 05169 RPS 22680 a

1        (1) Any benefits under the System earned as a result of
2    that return to participating employee status shall be based
3    solely on the person's credits and creditable service
4    arising from the return to participating employee status.
5        (2) The accelerated pension benefit payment may not be
6    repaid to the System, and the terminated credits and
7    creditable service may not under any circumstances be
8    reinstated.
9    (e) As a condition of receiving an accelerated pension
10benefit payment, an eligible person must have another
11retirement plan or account qualified under the Internal Revenue
12Code of 1986, as amended, for the accelerated pension benefit
13payment to be rolled into. The accelerated pension benefit
14payment under this Section may be subject to withholding or
15payment of applicable taxes, but to the extent permitted by
16federal law, a person who receives an accelerated pension
17benefit payment under this Section must direct the System to
18pay all of that payment as a rollover into another retirement
19plan or account qualified under the Internal Revenue Code of
201986, as amended.
21    (f) Before January 1, 2019 and every January 1 thereafter,
22the Board shall certify to the Illinois Finance Authority and
23the General Assembly the amount by which the total amount of
24accelerated pension benefit payments made under this Section
25exceed the amount appropriated to the System for the purpose of
26making those payments.

 

 

10000SB0016sam001- 209 -LRB100 05169 RPS 22680 a

1    (g) The Board shall adopt any rules necessary to implement
2this Section.
3    (h) No provision of this Section shall be interpreted in a
4way that would cause the applicable System to cease to be a
5qualified plan under the Internal Revenue Code of 1986.
6    (i) Notwithstanding any other provision of this Section, in
7no case shall the total amount of accelerated pension benefit
8payments paid under this Section, Section 14-147.5, and Section
916-190.5 cause the Illinois Finance Authority to issue more
10than the $250,000,000 of State Pension Obligation Acceleration
11Bonds authorized in subsection (c-5) of Section 801-40 of the
12Illinois Finance Authority Act.
 
13    (40 ILCS 5/15-198)
14    (Text of Section WITHOUT the changes made by P.A. 98-599,
15which has been held unconstitutional)
16    Sec. 15-198. Application and expiration of new benefit
17increases.
18    (a) As used in this Section, "new benefit increase" means
19an increase in the amount of any benefit provided under this
20Article, or an expansion of the conditions of eligibility for
21any benefit under this Article, that results from an amendment
22to this Code that takes effect after the effective date of this
23amendatory Act of the 94th General Assembly. "New benefit
24increase", however, does not include any benefit increase
25resulting from the changes made to this Article by this

 

 

10000SB0016sam001- 210 -LRB100 05169 RPS 22680 a

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

 

 

10000SB0016sam001- 211 -LRB100 05169 RPS 22680 a

1    (d) Every new benefit increase shall expire 5 years after
2its effective date or on such earlier date as may be specified
3in the language enacting the new benefit increase or provided
4under subsection (c). This does not prevent the General
5Assembly from extending or re-creating a new benefit increase
6by law.
7    (e) Except as otherwise provided in the language creating
8the new benefit increase, a new benefit increase that expires
9under this Section continues to apply to persons who applied
10and qualified for the affected benefit while the new benefit
11increase was in effect and to the affected beneficiaries and
12alternate payees of such persons, but does not apply to any
13other person, including without limitation a person who
14continues in service after the expiration date and did not
15apply and qualify for the affected benefit while the new
16benefit increase was in effect.
17(Source: P.A. 94-4, eff. 6-1-05.)
 
18    (40 ILCS 5/15-200.1 new)
19    Sec. 15-200.1. Defined contribution plan.
20    (a) By July 1, 2018, the System shall prepare and implement
21a voluntary defined contribution plan for up to 5% of eligible
22Tier 1 employees. The System shall determine the 5% cap by the
23number of Tier 1 employees on the effective date of this
24Section. The defined contribution plan developed under this
25Section shall be a plan that aggregates employer and employee

 

 

10000SB0016sam001- 212 -LRB100 05169 RPS 22680 a

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

 

 

10000SB0016sam001- 213 -LRB100 05169 RPS 22680 a

1        (3) State contributions shall be paid into the accounts
2    of all participants in the defined contribution plan at a
3    uniform rate, expressed as a percentage of earnings and
4    determined for each year. This rate shall be no higher than
5    the employer's normal cost for Tier 1 employees in the
6    defined benefit plan for that year, as determined by the
7    System and expressed as a percentage of earnings, and shall
8    be no lower than 3% of earnings. The State shall adjust
9    this rate annually.
10        (4) The defined contribution plan shall require 5 years
11    of participation in the defined contribution plan before
12    vesting in State contributions. If the participant fails to
13    vest in them, the State contributions, and the earnings
14    thereon, shall be forfeited.
15        (5) The defined contribution plan may provide for
16    participants in the plan to be eligible for the defined
17    disability benefits available to other participants under
18    this Article. If it does, the System shall reduce the
19    employee contributions credited to the member's defined
20    contribution plan account by an amount determined by the
21    System to cover the cost of offering such benefits.
22        (6) The defined contribution plan shall provide a
23    variety of options for investments. These options shall
24    include investments handled by the System as well as
25    private sector investment options.
26        (7) The defined contribution plan shall provide a

 

 

10000SB0016sam001- 214 -LRB100 05169 RPS 22680 a

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

 

 

10000SB0016sam001- 215 -LRB100 05169 RPS 22680 a

1plan, the System shall provide notice to previously eligible
2employees that the plan is no longer available and shall cease
3accepting applications to participate.
4    (d) The System shall make a good faith effort to contact
5each Tier 1 employee who is eligible to participate in the
6defined contribution plan. The System shall mail information
7describing the option to join the defined contribution plan to
8each of these employees to his or her last known address on
9file with the System. If the employee is not responsive to
10other means of contact, it is sufficient for the System to
11publish the details of the option on its website.
12    Upon request for further information describing the
13option, the System shall provide employees with information
14from the System before exercising the option to join the plan,
15including information on the impact to their vested benefits or
16non-vested service. The individual consultation shall include
17projections of the member's defined benefits at retirement or
18earlier termination of service and the value of the member's
19account at retirement or earlier termination of service. The
20System shall not provide advice or counseling with respect to
21whether the employee should exercise the option. The System
22shall inform Tier 1 employees who are eligible to participate
23in the defined contribution plan that they may also wish to
24obtain information and counsel relating to their option from
25any other available source, including but not limited to labor
26organizations, private counsel, and financial advisors.

 

 

10000SB0016sam001- 216 -LRB100 05169 RPS 22680 a

1    (e) In no event shall the System, its staff, its authorized
2representatives, or the Board be liable for any information
3given to an employee under this Section. The System may
4coordinate with the Illinois Department of Central Management
5Services and other retirement systems administering a defined
6contribution plan in accordance with this amendatory Act of the
7100th General Assembly to provide information concerning the
8impact of the option set forth in this Section.
9    (f) Notwithstanding any other provision of this Section, no
10person shall begin participating in the defined contribution
11plan until it has attained qualified plan status and received
12all necessary approvals from the U.S. Internal Revenue Service.
13    (g) The System shall report on its progress under this
14Section, including the available details of the defined
15contribution plan and the System's plans for informing eligible
16Tier 1 employees about the plan, to the Governor and the
17General Assembly on or before January 15, 2018.
18    (h) If a Tier 1 employee has not made an election under
19Section 15-134.5 of this Code, then the plan prescribed under
20this Section shall not apply to that Tier 1 employee and that
21Tier 1 employee shall remain eligible to make the election
22prescribed under Section 15-134.5.
23    (i) The intent of this amendatory Act of the 100th General
24Assembly is to ensure that the State's normal cost of
25participation in the defined contribution plan is similar, and
26if possible equal, to the State's normal cost of participation

 

 

10000SB0016sam001- 217 -LRB100 05169 RPS 22680 a

1in the defined benefit plan, unless a lower State's normal cost
2is necessary to ensure cost neutrality.
3    (j) If Section 15-132.9 is determined to be
4unconstitutional or otherwise invalid by a final unappealable
5decision of an Illinois court or a court of competent
6jurisdiction, then this Section shall not take effect and is
7repealed by operation of law.
 
8    (40 ILCS 5/15-201.1 new)
9    Sec. 15-201.1. Defined contribution plan; termination. If
10the defined contribution plan is terminated or becomes
11inoperative pursuant to law, then each participant in the plan
12shall automatically be deemed to have been a contributing Tier
131 employee participating in the System's defined benefit plan
14during the time in which he or she participated in the defined
15contribution plan, and for that purpose the System shall be
16entitled to recover the amounts in the participant's defined
17contribution accounts.
 
18    (40 ILCS 5/16-107.1 new)
19    Sec. 16-107.1. Tier 1 employee. "Tier 1 employee": A
20teacher under this Article who first became a member or
21participant before January 1, 2011 under any reciprocal
22retirement system or pension fund established under this Code
23other than a retirement system or pension fund established
24under Article 2, 3, 4, 5, 6, or 18 of this Code. However, for

 

 

10000SB0016sam001- 218 -LRB100 05169 RPS 22680 a

1the purposes of the election under Section 16-122.9, "Tier 1
2employee" does not include a teacher under this Article who
3would qualify as a Tier 1 employee but who has made an
4irrevocable election on or before June 1, 2017 to retire from
5service pursuant to the terms of an employment contract or a
6collective bargaining agreement in effect on June 1, 2017,
7excluding any extension, amendment, or renewal of that
8agreement after that date, and has notified the System of that
9election.
 
10    (40 ILCS 5/16-121)  (from Ch. 108 1/2, par. 16-121)
11    (Text of Section WITHOUT the changes made by P.A. 98-599,
12which has been held unconstitutional)
13    Sec. 16-121. Salary. "Salary": The actual compensation
14received by a teacher during any school year and recognized by
15the system in accordance with rules of the board. For purposes
16of this Section, "school year" includes the regular school term
17plus any additional period for which a teacher is compensated
18and such compensation is recognized by the rules of the board.
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 16-122.9 and accepted under that condition by a
24Tier 1 employee who has made the election under paragraph (2)
25of subsection (a) of Section 16-122.9.

 

 

10000SB0016sam001- 219 -LRB100 05169 RPS 22680 a

1    Notwithstanding any other provision of this Section,
2"salary" does not include any consideration payment made to a
3Tier 1 employee.
4(Source: P.A. 84-1028.)
 
5    (40 ILCS 5/16-121.1 new)
6    Sec. 16-121.1. Future increase in income. "Future increase
7in income" means an increase to a Tier 1 employee's base pay
8that is offered by an employer to the Tier 1 employee for
9service under this Article after June 30, 2018 that qualifies
10as "salary", as defined in Section 16-121, or would qualify as
11"salary" but for the fact that it was offered to and accepted
12by the Tier 1 employee under the condition set forth in
13subsection (c) of Section 16-122.9. The term "future increase
14in income" includes an increase to a Tier 1 employee's base pay
15that is paid to the Tier 1 employee pursuant to an extension,
16amendment, or renewal of any such employment contract or
17collective bargaining agreement after the effective date of
18this Section.
 
19    (40 ILCS 5/16-121.2 new)
20    Sec. 16-121.2. Base pay. As used in Section 16-121.1 of
21this Code, "base pay" means the greater of either (i) the Tier
221 employee's annualized rate of salary as of June 30, 2018, or
23(ii) the Tier 1 employee's annualized rate of salary
24immediately preceding the expiration, renewal, or amendment of

 

 

10000SB0016sam001- 220 -LRB100 05169 RPS 22680 a

1an employment contract or collective bargaining agreement in
2effect on the effective date of this Section. For a person
3returning to active service as a Tier 1 employee after June 30,
42018, however, "base pay" means the employee's annualized rate
5of salary as of the employee's last date of service prior to
6July 1, 2018. The System shall calculate the base pay of each
7Tier 1 employee pursuant to this Section.
 
8    (40 ILCS 5/16-122.9 new)
9    Sec. 16-122.9. Election by Tier 1 employees.
10    (a) Each active Tier 1 employee shall make an irrevocable
11election either:
12        (1) to agree to delay his or her eligibility for
13    automatic annual increases in retirement annuity as
14    provided in subsection (a-1) of Section 16-133.1 or
15    subsection (b-1) of Section 16-136.1, whichever is
16    applicable, and to have the amount of the automatic annual
17    increases in his or her retirement annuity and survivor
18    benefit that are otherwise provided for in this Article