101ST GENERAL ASSEMBLY
State of Illinois
2019 and 2020
SB3807

 

Introduced 2/14/2020, by Sen. Robert F. Martwick

 

SYNOPSIS AS INTRODUCED:
 
40 ILCS 5/7-168  from Ch. 108 1/2, par. 7-168
40 ILCS 5/7-173  from Ch. 108 1/2, par. 7-173
30 ILCS 805/8.44 new

    Amends the Illinois Municipal Retirement Fund (IMRF) Article of the Illinois Pension Code. Provides that the amount of the separation benefit shall include interest credited to the end of the preceding calendar year for contributions made under provisions authorizing employees to make additional contributions for retirement annuity purposes, to the extent permitted by the Internal Revenue Code of 1986. Provides that employees who first participate in the Fund on or after 6 months after the effective date of the amendatory Act shall automatically contribute 3% of each payment of earnings as additional contributions for retirement annuity purposes beginning immediately upon enrollment in the Fund as a participating employee. Provides that employees may change such contributions to an amount not to exceed 10% of each payment of earnings at any time by written notice to the Board. Provides that the Board may limit the number of withdrawals of those additional contributions to an amount not less than once per calendar year and to charge an administrative fee to cover the costs of processing such withdrawals. Amends the State Mandates Act to require implementation without reimbursement. Effective January 1, 2021.


LRB101 19678 RPS 69169 b

FISCAL NOTE ACT MAY APPLY
PENSION IMPACT NOTE ACT MAY APPLY
STATE MANDATES ACT MAY REQUIRE REIMBURSEMENT

 

 

A BILL FOR

 

SB3807LRB101 19678 RPS 69169 b

1    AN ACT concerning public employee benefits.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Illinois Pension Code is amended by changing
5Sections 7-168 and 7-173 as follows:
 
6    (40 ILCS 5/7-168)  (from Ch. 108 1/2, par. 7-168)
7    Sec. 7-168. Separation benefits - Amount. The amount of the
8separation benefits shall be the sum of the employee's
9accumulated normal, survivor and additional contributions,
10plus interest credited to the end of the preceding calendar
11year for contributions made under paragraph (2) of subsection
12(a) of Section 7-173, to the extent permitted by the federal
13Internal Revenue Code of 1986, as now or hereafter amended.
14(Source: P.A. 87-740.)
 
15    (40 ILCS 5/7-173)  (from Ch. 108 1/2, par. 7-173)
16    Sec. 7-173. Contributions by employees.
17    (a) Each participating employee shall make contributions
18to the fund as follows:
19        1. For retirement annuity purposes, normal
20    contributions of 3 3/4% of earnings.
21        2. Additional contributions of such percentages of
22    each payment of earnings, as shall be elected by the

 

 

SB3807- 2 -LRB101 19678 RPS 69169 b

1    employee for retirement annuity purposes, but not in excess
2    of 10%. The selected rate shall be applicable to all
3    earnings paid following receipt by the Board of written
4    notice of election to make such contributions. Additional
5    contributions at the selected rate shall be made
6    concurrently with normal contributions.
7        Employees who first participate in the Fund on or after
8    6 months after the effective date of this amendatory Act of
9    the 101st General Assembly shall automatically contribute
10    3% of each payment of earnings as additional contributions
11    for retirement annuity purposes beginning immediately upon
12    enrollment in the Fund as a participating employee.
13    Employees may change such contributions to an amount not to
14    exceed 10% of each payment of earnings at any time by
15    written notice to the Board.
16        3. Survivor contributions, by each participating
17    employee, of 3/4% of each payment of earnings.
18    (b) (Blank).
19    (c) Contributions shall be deducted from each
20corresponding payment of earnings paid to each employee and
21shall be remitted to the board by the participating
22municipality or participating instrumentality making such
23payment. The remittance, together with a report of the earnings
24and contributions shall be made as directed by the board. For
25township treasurers and employees of township treasurers
26qualifying as employees hereunder, the contributions herein

 

 

SB3807- 3 -LRB101 19678 RPS 69169 b

1required as deductions from salary shall be withheld by the
2school township trustees from funds available for the payment
3of the compensation of such treasurers and employees as
4provided in the School Code and remitted to the board.
5    (d) An employee who has made additional contributions under
6paragraph (a)2 of this Section may upon retirement or at any
7time prior thereto, elect to withdraw the total of such
8additional contributions including interest credited thereon
9to the end of the preceding calendar year, to the extent
10permitted by the federal Internal Revenue Code of 1986, as now
11or hereafter amended. The Board has the ability to limit the
12number of such withdrawals permitted to an amount not less than
13once per calendar year and to charge an administrative fee to
14cover the costs of processing such withdrawals.
15    (e) Failure to make the deductions for employee
16contributions provided in paragraph (c) of this Section shall
17not relieve the employee from liability for such contributions.
18The amount of such liability may be deducted, with interest
19charged under Section 7-209, from any annuities or benefits
20payable hereunder to the employee or any other person receiving
21an annuity or benefit by reason of such employee's
22participation.
23    (f) A participating employee who has at least 40 years of
24creditable service in the Fund may elect to cease making the
25contributions required under this Section. The status of the
26employee under this Article shall be unaffected by this

 

 

SB3807- 4 -LRB101 19678 RPS 69169 b

1election, except that the employee shall not receive any
2additional creditable service for the periods of employment
3following the election. An election under this subsection
4relieves the employer from making additional employer
5contributions in relation to that employee.
6(Source: P.A. 97-333, eff. 8-12-11; 97-933, eff. 8-10-12;
798-218, eff. 8-9-13.)
 
8    Section 90. The State Mandates Act is amended by adding
9Section 8.44 as follows:
 
10    (30 ILCS 805/8.44 new)
11    Sec. 8.44. Exempt mandate. Notwithstanding Sections 6 and 8
12of this Act, no reimbursement by the State is required for the
13implementation of any mandate created by this amendatory Act of
14the 101st General Assembly.
 
15    Section 99. Effective date. This Act takes effect January
161, 2021.