Sen. Ira I. Silverstein

Filed: 5/11/2004

 

 


 

 


 
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1
AMENDMENT TO HOUSE BILL 587

2     AMENDMENT NO. ______. Amend House Bill 587 by replacing
3 everything after the enacting clause with the following:
 
4     "Section 5. The Illinois Pension Code is amended by
5 changing Sections 7-137 and 7-139 as follows:
 
6     (40 ILCS 5/7-137)  (from Ch. 108 1/2, par. 7-137)
7     Sec. 7-137. Participating and covered employees.
8     (a) The persons described in this paragraph (a) shall be
9 included within and be subject to this Article and eligible to
10 benefits from this fund, beginning upon the dates hereinafter
11 specified:
12         1. Except as to the employees specifically excluded
13     under the provisions of this Article, all persons who are
14     employees of any municipality (or instrumentality thereof)
15     or participating instrumentality on the effective date of
16     participation of the municipality or participating
17     instrumentality beginning upon such effective date.
18         2. Except as to the employees specifically excluded
19     under the provisions of this Article, all persons, who
20     became employees of any participating municipality (or
21     instrumentality thereof) or participating instrumentality
22     after the effective date of participation of such
23     municipality or participating instrumentality, beginning
24     upon the date such person becomes an employee.

 

 

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1         3. All persons who file notice with the board as
2     provided in paragraph (b) 2 and 3 of this Section,
3     beginning upon the date of filing such notice.
4     (b) The following described persons shall not be considered
5 participating employees eligible for benefits from this fund,
6 but shall be included within and be subject to this Article
7 (each of the descriptions is not exclusive but is cumulative):
8         1. Any person who occupies an office or is employed in
9     a position normally requiring performance of duty during
10     less than 600 hours a year for a municipality (including
11     all instrumentalities thereof) or a participating
12     instrumentality. If a school treasurer performs services
13     for more than one school district, the total number of
14     hours of service normally required for the several school
15     districts shall be considered to determine whether he
16     qualifies under this paragraph;
17         2. Any person who holds elective office unless he has
18     elected while in that office in a written notice on file
19     with the board to become a participating employee;
20         3. Any person working for a city hospital unless any
21     such person, while in active employment, has elected in a
22     written notice on file with the board to become a
23     participating employee and notification thereof is
24     received by the board;
25         4. Any person who becomes an employee after June 30,
26     1979 as a public service employment program participant
27     under the federal Comprehensive Employment and Training
28     Act and whose wages or fringe benefits are paid in whole or
29     in part by funds provided under such Act; .
30         5. Any person who is actively employed by a
31     municipality on its effective date of participation in the
32     Fund if that municipality (i) has at least 35 employees on
33     its effective date of participation; (ii) is located in a
34     county with at least 2,000,000 inhabitants; and (iii)

 

 

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1     maintains an independent defined benefit pension plan for
2     the benefit of its eligible employees, unless the person
3     files with the board within 90 days after the
4     municipality's effective date of participation an
5     irrevocable election to participate.
6     (c) Any person electing to be a participating employee,
7 pursuant to paragraph (b) of this Section may not change such
8 election, except as provided in Section 7-137.1.
9     (d) Any employee who occupied the position of school nurse
10 in any participating municipality on August 8, 1961 and
11 continuously thereafter until the effective date of the
12 exercise of the option authorized by this subparagraph, who on
13 August 7, 1961 was a member of the Teachers' Retirement System
14 of Illinois, by virtue of certification by the Department of
15 Registration and Education as a public health nurse, may elect
16 to terminate participation in this Fund in order to
17 re-establish membership in such System. The election may be
18 exercised by filing written notice thereof with the Board or
19 with the Board of Trustees of said Teachers' Retirement System,
20 not later than September 30, 1963, and shall be effective on
21 the first day of the calendar month next following the month in
22 which the notice was filed. If the written notice is filed with
23 such Teachers' Retirement System, that System shall
24 immediately notify this Fund, but neither failure nor delay in
25 notification shall affect the validity of the employee's
26 election. If the option is exercised, the Fund shall notify
27 such Teachers' Retirement System of such fact and transfer to
28 that system the amounts contributed by the employee to this
29 Fund, including interest at 3% per annum, but excluding
30 contributions applicable to social security coverage during
31 the period beginning August 8, 1961 to the effective date of
32 the employee's election. Participation in this Fund as to any
33 credits on or after August 8, 1961 and up to the effective date
34 of the employee's election shall terminate on such effective

 

 

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1 date.
2     (e) Any participating municipality or participating
3 instrumentality, other than a school district or special
4 education joint agreement created under Section 10-22.31 of the
5 School Code, may, by a resolution or ordinance duly adopted by
6 its governing body, elect to exclude from participation and
7 eligibility for benefits all persons who are employed after the
8 effective date of such resolution or ordinance and who occupy
9 an office or are employed in a position normally requiring
10 performance of duty for less than 1000 hours per year for the
11 participating municipality (including all instrumentalities
12 thereof) or participating instrumentality except for persons
13 employed in a position normally requiring performance of duty
14 for 600 hours or more per year (i) by such participating
15 municipality or participating instrumentality prior to the
16 effective date of the resolution or ordinance, (ii) by any
17 participating municipality or participating instrumentality
18 prior to January 1, 1982 and (iii) by a participating
19 municipality or participating instrumentality, which had not
20 adopted such a resolution when the person was employed, and the
21 function served by the employee's position is assumed by
22 another participating municipality or participating
23 instrumentality. A participating municipality or participating
24 instrumentality included in and subject to this Article after
25 January 1, 1982 may adopt such resolution or ordinance only
26 prior to the date it becomes included in and subject to this
27 Article. Notwithstanding the foregoing, a participating
28 municipality or participating instrumentality which is formed
29 solely to succeed to the functions of a participating
30 municipality or participating instrumentality shall be
31 considered to have adopted any such resolution or ordinance
32 which may have been applicable to the employees performing such
33 functions. The election made by the resolution or ordinance
34 shall take effect at the time specified in the resolution or

 

 

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1 ordinance, and once effective shall be irrevocable.
2 (Source: P.A. 86-272; 87-740; 87-850.)
 
3     (40 ILCS 5/7-139)  (from Ch. 108 1/2, par. 7-139)
4     Sec. 7-139. Credits and creditable service to employees.
5     (a) Each participating employee shall be granted credits
6 and creditable service, for purposes of determining the amount
7 of any annuity or benefit to which he or a beneficiary is
8 entitled, as follows:
9         1. For prior service: Each participating employee who
10     is an employee of a participating municipality or
11     participating instrumentality on the effective date shall
12     be granted creditable service, but no credits under
13     paragraph 2 of this subsection (a), for periods of prior
14     service for which credit has not been received under any
15     other pension fund or retirement system established under
16     this Code, as follows:
17         If the effective date of participation for the
18     participating municipality or participating
19     instrumentality is on or before January 1, 1998, creditable
20     service shall be granted for the entire period of prior
21     service with that employer without any employee
22     contribution.
23         If the effective date of participation for the
24     participating municipality or participating
25     instrumentality is after January 1, 1998, creditable
26     service shall be granted for the last 20% of the period of
27     prior service with that employer, but no more than 5 years,
28     without any employee contribution. A participating
29     employee may establish creditable service for the
30     remainder of the period of prior service with that employer
31     by making an application in writing, accompanied by payment
32     of an employee contribution in an amount determined by the
33     Fund, based on the employee contribution rates in effect at

 

 

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1     the time of application for the creditable service and the
2     employee's salary rate on the effective date of
3     participation for that employer, plus interest at the
4     effective rate from the date of the prior service to the
5     date of payment. Application for this creditable service
6     may be made at any time while the employee is still in
7     service.
8         A municipality that (i) has at least 35 employees; (ii)
9     is located in a county with at least 2,000,000 inhabitants;
10     and (iii) maintains an independent defined benefit pension
11     plan for the benefit of its eligible employees may restrict
12     creditable service in whole or in part for periods of prior
13     service with the employer if the governing body of the
14     municipality adopts an irrevocable resolution to restrict
15     that creditable service and files the resolution with the
16     board before the municipality's effective date of
17     participation.
18         Any person who has withdrawn from the service of a
19     participating municipality or participating
20     instrumentality prior to the effective date, who reenters
21     the service of the same municipality or participating
22     instrumentality after the effective date and becomes a
23     participating employee is entitled to creditable service
24     for prior service as otherwise provided in this subdivision
25     (a)(1) only if he or she renders 2 years of service as a
26     participating employee after the effective date.
27     Application for such service must be made while in a
28     participating status. The salary rate to be used in the
29     calculation of the required employee contribution, if any,
30     shall be the employee's salary rate at the time of first
31     reentering service with the employer after the employer's
32     effective date of participation.
33         2. For current service, each participating employee
34     shall be credited with:

 

 

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1             a. Additional credits of amounts equal to each
2         payment of additional contributions received from him
3         under Section 7-173, as of the date the corresponding
4         payment of earnings is payable to him.
5             b. Normal credits of amounts equal to each payment
6         of normal contributions received from him, as of the
7         date the corresponding payment of earnings is payable
8         to him, and normal contributions made for the purpose
9         of establishing out-of-state service credits as
10         permitted under the conditions set forth in paragraph 6
11         of this subsection (a).
12             c. Municipality credits in an amount equal to 1.4
13         times the normal credits, except those established by
14         out-of-state service credits, as of the date of
15         computation of any benefit if these credits would
16         increase the benefit.
17             d. Survivor credits equal to each payment of
18         survivor contributions received from the participating
19         employee as of the date the corresponding payment of
20         earnings is payable, and survivor contributions made
21         for the purpose of establishing out-of-state service
22         credits.
23         3. For periods of temporary and total and permanent
24     disability benefits, each employee receiving disability
25     benefits shall be granted creditable service for the period
26     during which disability benefits are payable. Normal and
27     survivor credits, based upon the rate of earnings applied
28     for disability benefits, shall also be granted if such
29     credits would result in a higher benefit to any such
30     employee or his beneficiary.
31         4. For authorized leave of absence without pay: A
32     participating employee shall be granted credits and
33     creditable service for periods of authorized leave of
34     absence without pay under the following conditions:

 

 

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1             a. An application for credits and creditable
2         service is submitted to the board while the employee is
3         in a status of active employment, and within 2 years
4         after termination of the leave of absence period for
5         which credits and creditable service are sought.
6             b. Not more than 12 complete months of creditable
7         service for authorized leave of absence without pay
8         shall be counted for purposes of determining any
9         benefits payable under this Article.
10             c. Credits and creditable service shall be granted
11         for leave of absence only if such leave is approved by
12         the governing body of the municipality, including
13         approval of the estimated cost thereof to the
14         municipality as determined by the fund, and employee
15         contributions, plus interest at the effective rate
16         applicable for each year from the end of the period of
17         leave to date of payment, have been paid to the fund in
18         accordance with Section 7-173. The contributions shall
19         be computed upon the assumption earnings continued
20         during the period of leave at the rate in effect when
21         the leave began.
22             d. Benefits under the provisions of Sections
23         7-141, 7-146, 7-150 and 7-163 shall become payable to
24         employees on authorized leave of absence, or their
25         designated beneficiary, only if such leave of absence
26         is creditable hereunder, and if the employee has at
27         least one year of creditable service other than the
28         service granted for leave of absence. Any employee
29         contributions due may be deducted from any benefits
30         payable.
31             e. No credits or creditable service shall be
32         allowed for leave of absence without pay during any
33         period of prior service.
34         5. For military service: The governing body of a

 

 

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1     municipality or participating instrumentality may elect to
2     allow creditable service to participating employees who
3     leave their employment to serve in the armed forces of the
4     United States for all periods of such service, provided
5     that the person returns to active employment within 90 days
6     after completion of full time active duty, but no
7     creditable service shall be allowed such person for any
8     period that can be used in the computation of a pension or
9     any other pay or benefit, other than pay for active duty,
10     for service in any branch of the armed forces of the United
11     States. If necessary to the computation of any benefit, the
12     board shall establish municipality credits for
13     participating employees under this paragraph on the
14     assumption that the employee received earnings at the rate
15     received at the time he left the employment to enter the
16     armed forces. A participating employee in the armed forces
17     shall not be considered an employee during such period of
18     service and no additional death and no disability benefits
19     are payable for death or disability during such period.
20         Any participating employee who left his employment
21     with a municipality or participating instrumentality to
22     serve in the armed forces of the United States and who
23     again became a participating employee within 90 days after
24     completion of full time active duty by entering the service
25     of a different municipality or participating
26     instrumentality, which has elected to allow creditable
27     service for periods of military service under the preceding
28     paragraph, shall also be allowed creditable service for his
29     period of military service on the same terms that would
30     apply if he had been employed, before entering military
31     service, by the municipality or instrumentality which
32     employed him after he left the military service and the
33     employer costs arising in relation to such grant of
34     creditable service shall be charged to and paid by that

 

 

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1     municipality or instrumentality.
2         Notwithstanding the foregoing, any participating
3     employee shall be entitled to creditable service as
4     required by any federal law relating to re-employment
5     rights of persons who served in the United States Armed
6     Services. Such creditable service shall be granted upon
7     payment by the member of an amount equal to the employee
8     contributions which would have been required had the
9     employee continued in service at the same rate of earnings
10     during the military leave period, plus interest at the
11     effective rate.
12         5.1. In addition to any creditable service established
13     under paragraph 5 of this subsection (a), creditable
14     service may be granted for up to 24 months of service in
15     the armed forces of the United States.
16         In order to receive creditable service for military
17     service under this paragraph 5.1, a participating employee
18     must (1) apply to the Fund in writing and provide evidence
19     of the military service that is satisfactory to the Board;
20     (2) obtain the written approval of the current employer;
21     and (3) make contributions to the Fund equal to (i) the
22     employee contributions that would have been required had
23     the service been rendered as a member, plus (ii) an amount
24     determined by the board to be equal to the employer's
25     normal cost of the benefits accrued for that military
26     service, plus (iii) interest on items (i) and (ii) from the
27     date of first membership in the Fund to the date of
28     payment. If payment is made during the 6-month period that
29     begins 3 months after the effective date of this amendatory
30     Act of 1997, the required interest shall be at the rate of
31     2.5% per year, compounded annually; otherwise, the
32     required interest shall be calculated at the regular
33     interest rate.
34         6. For out-of-state service: Creditable service shall

 

 

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1     be granted for service rendered to an out-of-state local
2     governmental body under the following conditions: The
3     employee had participated and has irrevocably forfeited
4     all rights to benefits in the out-of-state public employees
5     pension system; the governing body of his participating
6     municipality or instrumentality authorizes the employee to
7     establish such service; the employee has 2 years current
8     service with this municipality or participating
9     instrumentality; the employee makes a payment of
10     contributions, which shall be computed at 8% (normal) plus
11     2% (survivor) times length of service purchased times the
12     average rate of earnings for the first 2 years of service
13     with the municipality or participating instrumentality
14     whose governing body authorizes the service established
15     plus interest at the effective rate on the date such
16     credits are established, payable from the date the employee
17     completes the required 2 years of current service to date
18     of payment. In no case shall more than 120 months of
19     creditable service be granted under this provision.
20         7. For retroactive service: Any employee who could have
21     but did not elect to become a participating employee, or
22     who should have been a participant in the Municipal Public
23     Utilities Annuity and Benefit Fund before that fund was
24     superseded, may receive creditable service for the period
25     of service not to exceed 50 months; however, a current or
26     former elected or appointed official of a participating
27     municipality may establish credit under this paragraph 7
28     for more than 50 months of service as an official of that
29     municipality, if the excess over 50 months is approved by
30     resolution of the governing body of the affected
31     municipality filed with the Fund before January 1, 2002.
32         Any employee who is a participating employee on or
33     after September 24, 1981 and who was excluded from
34     participation by the age restrictions removed by Public Act

 

 

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1     82-596 may receive creditable service for the period, on or
2     after January 1, 1979, excluded by the age restriction and,
3     in addition, if the governing body of the participating
4     municipality or participating instrumentality elects to
5     allow creditable service for all employees excluded by the
6     age restriction prior to January 1, 1979, for service
7     during the period prior to that date excluded by the age
8     restriction. Any employee who was excluded from
9     participation by the age restriction removed by Public Act
10     82-596 and who is not a participating employee on or after
11     September 24, 1981 may receive creditable service for
12     service after January 1, 1979. Creditable service under
13     this paragraph shall be granted upon payment of the
14     employee contributions which would have been required had
15     he participated, with interest at the effective rate for
16     each year from the end of the period of service established
17     to date of payment.
18         8. For accumulated unused sick leave: A participating
19     employee who is applying for a retirement annuity shall be
20     entitled to creditable service for that portion of the
21     employee's accumulated unused sick leave for which payment
22     is not received, as follows:
23             a. Sick leave days shall be limited to those
24         accumulated under a sick leave plan established by a
25         participating municipality or participating
26         instrumentality which is available to all employees or
27         a class of employees.
28             b. Only sick leave days accumulated with a
29         participating municipality or participating
30         instrumentality with which the employee was in service
31         within 60 days of the effective date of his retirement
32         annuity shall be credited; If the employee was in
33         service with more than one employer during this period
34         only the sick leave days with the employer with which

 

 

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1         the employee has the greatest number of unpaid sick
2         leave days shall be considered.
3             c. The creditable service granted shall be
4         considered solely for the purpose of computing the
5         amount of the retirement annuity and shall not be used
6         to establish any minimum service period required by any
7         provision of the Illinois Pension Code, the effective
8         date of the retirement annuity, or the final rate of
9         earnings.
10             d. The creditable service shall be at the rate of
11         1/20 of a month for each full sick day, provided that
12         no more than 12 months may be credited under this
13         subdivision 8.
14             e. Employee contributions shall not be required
15         for creditable service under this subdivision 8.
16             f. Each participating municipality and
17         participating instrumentality with which an employee
18         has service within 60 days of the effective date of his
19         retirement annuity shall certify to the board the
20         number of accumulated unpaid sick leave days credited
21         to the employee at the time of termination of service.
22         9. For service transferred from another system:
23     Credits and creditable service shall be granted for service
24     under Article 3, 4, 5, 14 or 16 of this Act, to any active
25     member of this Fund, and to any inactive member who has
26     been a county sheriff, upon transfer of such credits
27     pursuant to Section 3-110.3, 4-108.3, 5-235, 14-105.6 or
28     16-131.4, and payment by the member of the amount by which
29     (1) the employer and employee contributions that would have
30     been required if he had participated in this Fund as a
31     sheriff's law enforcement employee during the period for
32     which credit is being transferred, plus interest thereon at
33     the effective rate for each year, compounded annually, from
34     the date of termination of the service for which credit is

 

 

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1     being transferred to the date of payment, exceeds (2) the
2     amount actually transferred to the Fund. Such transferred
3     service shall be deemed to be service as a sheriff's law
4     enforcement employee for the purposes of Section 7-142.1.
5     (b) Creditable service - amount:
6         1. One month of creditable service shall be allowed for
7     each month for which a participating employee made
8     contributions as required under Section 7-173, or for which
9     creditable service is otherwise granted hereunder. Not
10     more than 1 month of service shall be credited and counted
11     for 1 calendar month, and not more than 1 year of service
12     shall be credited and counted for any calendar year. A
13     calendar month means a nominal month beginning on the first
14     day thereof, and a calendar year means a year beginning
15     January 1 and ending December 31.
16         2. A seasonal employee shall be given 12 months of
17     creditable service if he renders the number of months of
18     service normally required by the position in a 12-month
19     period and he remains in service for the entire 12-month
20     period. Otherwise a fractional year of service in the
21     number of months of service rendered shall be credited.
22         3. An intermittent employee shall be given creditable
23     service for only those months in which a contribution is
24     made under Section 7-173.
25     (c) No application for correction of credits or creditable
26 service shall be considered unless the board receives an
27 application for correction while (1) the applicant is a
28 participating employee and in active employment with a
29 participating municipality or instrumentality, or (2) while
30 the applicant is actively participating in a pension fund or
31 retirement system which is a participating system under the
32 Retirement Systems Reciprocal Act. A participating employee or
33 other applicant shall not be entitled to credits or creditable
34 service unless the required employee contributions are made in

 

 

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1 a lump sum or in installments made in accordance with board
2 rule.
3     (d) Upon the granting of a retirement, surviving spouse or
4 child annuity, a death benefit or a separation benefit, on
5 account of any employee, all individual accumulated credits
6 shall thereupon terminate. Upon the withdrawal of additional
7 contributions, the credits applicable thereto shall thereupon
8 terminate. Terminated credits shall not be applied to increase
9 the benefits any remaining employee would otherwise receive
10 under this Article.
11 (Source: P.A. 91-887, eff. 7-6-00; 92-424, eff. 8-17-01.)
 
12     Section 99. Effective date. This Act takes effect upon
13 becoming law.".