HB4996 EngrossedLRB097 14805 JDS 59833 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 15-113, 15-135, 15-136, 15-136.4, 15-139, 15-153.2,
6and 15-186 and by adding Sections 15-139.5 and 15-168.2 as
7follows:
 
8    (40 ILCS 5/15-113)  (from Ch. 108 1/2, par. 15-113)
9    Sec. 15-113. Service. "Service": The periods defined in
10Sections 15-113.1 through 15-113.9 and Section 15-113.11.
11(Source: P.A. 84-1472.)
 
12    (40 ILCS 5/15-135)  (from Ch. 108 1/2, par. 15-135)
13    Sec. 15-135. Retirement annuities - Conditions.
14    (a) A participant who retires in one of the following
15specified years with the specified amount of service is
16entitled to a retirement annuity at any age under the
17retirement program applicable to the participant:
18        35 years if retirement is in 1997 or before;
19        34 years if retirement is in 1998;
20        33 years if retirement is in 1999;
21        32 years if retirement is in 2000;
22        31 years if retirement is in 2001;

 

 

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1        30 years if retirement is in 2002 or later.
2    A participant with 8 or more years of service after
3September 1, 1941, is entitled to a retirement annuity on or
4after attainment of age 55.
5    A participant with at least 5 but less than 8 years of
6service after September 1, 1941, is entitled to a retirement
7annuity on or after attainment of age 62.
8    A participant who has at least 25 years of service in this
9system as a police officer or firefighter is entitled to a
10retirement annuity on or after the attainment of age 50, if
11Rule 4 of Section 15-136 is applicable to the participant.
12    (b) The annuity payment period shall begin on the date
13specified by the participant or the recipient of a disability
14retirement annuity submitting a written application, which
15date shall not be prior to termination of employment or more
16than one year before the application is received by the board;
17however, if the participant is not an employee of an employer
18participating in this System or in a participating system as
19defined in Article 20 of this Code on April 1 of the calendar
20year next following the calendar year in which the participant
21attains age 70 1/2, the annuity payment period shall begin on
22that date regardless of whether an application has been filed.
23    (c) An annuity is not payable if the amount provided under
24Section 15-136 is less than $10 per month.
25(Source: P.A. 92-749, eff. 8-2-02.)
 

 

 

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1    (40 ILCS 5/15-136)  (from Ch. 108 1/2, par. 15-136)
2    Sec. 15-136. Retirement annuities - Amount. The provisions
3of this Section 15-136 apply only to those participants who are
4participating in the traditional benefit package or the
5portable benefit package and do not apply to participants who
6are participating in the self-managed plan.
7    (a) The amount of a participant's retirement annuity,
8expressed in the form of a single-life annuity, shall be
9determined by whichever of the following rules is applicable
10and provides the largest annuity:
11    Rule 1: The retirement annuity shall be 1.67% of final rate
12of earnings for each of the first 10 years of service, 1.90%
13for each of the next 10 years of service, 2.10% for each year
14of service in excess of 20 but not exceeding 30, and 2.30% for
15each year in excess of 30; or for persons who retire on or
16after January 1, 1998, 2.2% of the final rate of earnings for
17each year of service.
18    Rule 2: The retirement annuity shall be the sum of the
19following, determined from amounts credited to the participant
20in accordance with the actuarial tables and the effective
21prescribed rate of interest in effect at the time the
22retirement annuity begins:
23        (i) the normal annuity which can be provided on an
24    actuarially equivalent basis, by the accumulated normal
25    contributions as of the date the annuity begins;
26        (ii) an annuity from employer contributions of an

 

 

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1    amount equal to that which can be provided on an
2    actuarially equivalent basis from the accumulated normal
3    contributions made by the participant under Section
4    15-113.6 and Section 15-113.7 plus 1.4 times all other
5    accumulated normal contributions made by the participant;
6    and
7        (iii) the annuity that can be provided on an
8    actuarially equivalent basis from the entire contribution
9    made by the participant under Section 15-113.3.
10    With respect to a police officer or firefighter who retires
11on or after August 14, 1998, the accumulated normal
12contributions taken into account under clauses (i) and (ii) of
13this Rule 2 shall include the additional normal contributions
14made by the police officer or firefighter under Section
1515-157(a).
16    The amount of a retirement annuity calculated under this
17Rule 2 shall be computed solely on the basis of the
18participant's accumulated normal contributions, as specified
19in this Rule and defined in Section 15-116. Neither an employee
20or employer contribution for early retirement under Section
2115-136.2 nor any other employer contribution shall be used in
22the calculation of the amount of a retirement annuity under
23this Rule 2.
24    This amendatory Act of the 91st General Assembly is a
25clarification of existing law and applies to every participant
26and annuitant without regard to whether status as an employee

 

 

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1terminates before the effective date of this amendatory Act.
2    This Rule 2 does not apply to a person who first becomes an
3employee under this Article on or after July 1, 2005.
4    Rule 3: The retirement annuity of a participant who is
5employed at least one-half time during the period on which his
6or her final rate of earnings is based, shall be equal to the
7participant's years of service not to exceed 30, multiplied by
8(1) $96 if the participant's final rate of earnings is less
9than $3,500, (2) $108 if the final rate of earnings is at least
10$3,500 but less than $4,500, (3) $120 if the final rate of
11earnings is at least $4,500 but less than $5,500, (4) $132 if
12the final rate of earnings is at least $5,500 but less than
13$6,500, (5) $144 if the final rate of earnings is at least
14$6,500 but less than $7,500, (6) $156 if the final rate of
15earnings is at least $7,500 but less than $8,500, (7) $168 if
16the final rate of earnings is at least $8,500 but less than
17$9,500, and (8) $180 if the final rate of earnings is $9,500 or
18more, except that the annuity for those persons having made an
19election under Section 15-154(a-1) shall be calculated and
20payable under the portable retirement benefit program pursuant
21to the provisions of Section 15-136.4.
22    Rule 4: A participant who is at least age 50 and has 25 or
23more years of service as a police officer or firefighter, and a
24participant who is age 55 or over and has at least 20 but less
25than 25 years of service as a police officer or firefighter,
26shall be entitled to a retirement annuity of 2 1/4% of the

 

 

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1final rate of earnings for each of the first 10 years of
2service as a police officer or firefighter, 2 1/2% for each of
3the next 10 years of service as a police officer or
4firefighter, and 2 3/4% for each year of service as a police
5officer or firefighter in excess of 20. The retirement annuity
6for all other service shall be computed under Rule 1.
7    For purposes of this Rule 4, a participant's service as a
8firefighter shall also include the following:
9        (i) service that is performed while the person is an
10    employee under subsection (h) of Section 15-107; and
11        (ii) in the case of an individual who was a
12    participating employee employed in the fire department of
13    the University of Illinois's Champaign-Urbana campus
14    immediately prior to the elimination of that fire
15    department and who immediately after the elimination of
16    that fire department transferred to another job with the
17    University of Illinois, service performed as an employee of
18    the University of Illinois in a position other than police
19    officer or firefighter, from the date of that transfer
20    until the employee's next termination of service with the
21    University of Illinois.
22    Rule 5: The retirement annuity of a participant who elected
23early retirement under the provisions of Section 15-136.2 and
24who, on or before February 16, 1995, brought administrative
25proceedings pursuant to the administrative rules adopted by the
26System to challenge the calculation of his or her retirement

 

 

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1annuity shall be the sum of the following, determined from
2amounts credited to the participant in accordance with the
3actuarial tables and the prescribed rate of interest in effect
4at the time the retirement annuity begins:
5        (i) the normal annuity which can be provided on an
6    actuarially equivalent basis, by the accumulated normal
7    contributions as of the date the annuity begins; and
8        (ii) an annuity from employer contributions of an
9    amount equal to that which can be provided on an
10    actuarially equivalent basis from the accumulated normal
11    contributions made by the participant under Section
12    15-113.6 and Section 15-113.7 plus 1.4 times all other
13    accumulated normal contributions made by the participant;
14    and
15        (iii) an annuity which can be provided on an
16    actuarially equivalent basis from the employee
17    contribution for early retirement under Section 15-136.2,
18    and an annuity from employer contributions of an amount
19    equal to that which can be provided on an actuarially
20    equivalent basis from the employee contribution for early
21    retirement under Section 15-136.2.
22    In no event shall a retirement annuity under this Rule 5 be
23lower than the amount obtained by adding (1) the monthly amount
24obtained by dividing the combined employee and employer
25contributions made under Section 15-136.2 by the System's
26annuity factor for the age of the participant at the beginning

 

 

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1of the annuity payment period and (2) the amount equal to the
2participant's annuity if calculated under Rule 1, reduced under
3Section 15-136(b) as if no contributions had been made under
4Section 15-136.2.
5    With respect to a participant who is qualified for a
6retirement annuity under this Rule 5 whose retirement annuity
7began before the effective date of this amendatory Act of the
891st General Assembly, and for whom an employee contribution
9was made under Section 15-136.2, the System shall recalculate
10the retirement annuity under this Rule 5 and shall pay any
11additional amounts due in the manner provided in Section
1215-186.1 for benefits mistakenly set too low.
13    The amount of a retirement annuity calculated under this
14Rule 5 shall be computed solely on the basis of those
15contributions specifically set forth in this Rule 5. Except as
16provided in clause (iii) of this Rule 5, neither an employee
17nor 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 5.
21    The General Assembly has adopted the changes set forth in
22Section 25 of this amendatory Act of the 91st General Assembly
23in recognition that the decision of the Appellate Court for the
24Fourth District in Mattis v. State Universities Retirement
25System et al. might be deemed to give some right to the
26plaintiff in that case. The changes made by Section 25 of this

 

 

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1amendatory Act of the 91st General Assembly are a legislative
2implementation of the decision of the Appellate Court for the
3Fourth District in Mattis v. State Universities Retirement
4System et al. with respect to that plaintiff.
5    The changes made by Section 25 of this amendatory Act of
6the 91st General Assembly apply without regard to whether the
7person is in service as an employee on or after its effective
8date.
9    (b) The retirement annuity provided under Rules 1 and 3
10above shall be reduced by 1/2 of 1% for each month the
11participant is under age 60 at the time of retirement. However,
12this reduction shall not apply in the following cases:
13        (1) For a disabled participant whose disability
14    benefits have been discontinued because he or she has
15    exhausted eligibility for disability benefits under clause
16    (6) of Section 15-152;
17        (2) For a participant who has at least the number of
18    years of service required to retire at any age under
19    subsection (a) of Section 15-135; or
20        (3) For that portion of a retirement annuity which has
21    been provided on account of service of the participant
22    during periods when he or she performed the duties of a
23    police officer or firefighter, if these duties were
24    performed for at least 5 years immediately preceding the
25    date the retirement annuity is to begin.
26    (c) The maximum retirement annuity provided under Rules 1,

 

 

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12, 4, and 5 shall be the lesser of (1) the annual limit of
2benefits as specified in Section 415 of the Internal Revenue
3Code of 1986, as such Section may be amended from time to time
4and as such benefit limits shall be adjusted by the
5Commissioner of Internal Revenue, and (2) 80% of final rate of
6earnings.
7    (d) An annuitant whose status as an employee terminates
8after August 14, 1969 shall receive automatic increases in his
9or her retirement annuity as follows:
10    Effective January 1 immediately following the date the
11retirement annuity begins, the annuitant shall receive an
12increase in his or her monthly retirement annuity of 0.125% of
13the monthly retirement annuity provided under Rule 1, Rule 2,
14Rule 3, Rule 4, or Rule 5, contained in this Section,
15multiplied by the number of full months which elapsed from the
16date the retirement annuity payments began to January 1, 1972,
17plus 0.1667% of such annuity, multiplied by the number of full
18months which elapsed from January 1, 1972, or the date the
19retirement annuity payments began, whichever is later, to
20January 1, 1978, plus 0.25% of such annuity multiplied by the
21number of full months which elapsed from January 1, 1978, or
22the date the retirement annuity payments began, whichever is
23later, to the effective date of the increase.
24    The annuitant shall receive an increase in his or her
25monthly retirement annuity on each January 1 thereafter during
26the annuitant's life of 3% of the monthly annuity provided

 

 

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1under Rule 1, Rule 2, Rule 3, Rule 4, or Rule 5 contained in
2this Section. The change made under this subsection by P.A.
381-970 is effective January 1, 1980 and applies to each
4annuitant whose status as an employee terminates before or
5after that date.
6    Beginning January 1, 1990, all automatic annual increases
7payable under this Section shall be calculated as a percentage
8of the total annuity payable at the time of the increase,
9including all increases previously granted under this Article.
10    The change made in this subsection by P.A. 85-1008 is
11effective January 26, 1988, and is applicable without regard to
12whether status as an employee terminated before that date.
13    (e) If, on January 1, 1987, or the date the retirement
14annuity payment period begins, whichever is later, the sum of
15the retirement annuity provided under Rule 1 or Rule 2 of this
16Section and the automatic annual increases provided under the
17preceding subsection or Section 15-136.1, amounts to less than
18the retirement annuity which would be provided by Rule 3, the
19retirement annuity shall be increased as of January 1, 1987, or
20the date the retirement annuity payment period begins,
21whichever is later, to the amount which would be provided by
22Rule 3 of this Section. Such increased amount shall be
23considered as the retirement annuity in determining benefits
24provided under other Sections of this Article. This paragraph
25applies without regard to whether status as an employee
26terminated before the effective date of this amendatory Act of

 

 

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11987, provided that the annuitant was employed at least
2one-half time during the period on which the final rate of
3earnings was based.
4    (f) A participant is entitled to such additional annuity as
5may be provided on an actuarially equivalent basis, by any
6accumulated additional contributions to his or her credit.
7However, the additional contributions made by the participant
8toward the automatic increases in annuity provided under this
9Section shall not be taken into account in determining the
10amount of such additional annuity.
11    (g) If, (1) by law, a function of a governmental unit, as
12defined by Section 20-107 of this Code, is transferred in whole
13or in part to an employer, and (2) a participant transfers
14employment from such governmental unit to such employer within
156 months after the transfer of the function, and (3) the sum of
16(A) the annuity payable to the participant under Rule 1, 2, or
173 of this Section (B) all proportional annuities payable to the
18participant by all other retirement systems covered by Article
1920, and (C) the initial primary insurance amount to which the
20participant is entitled under the Social Security Act, is less
21than the retirement annuity which would have been payable if
22all of the participant's pension credits validated under
23Section 20-109 had been validated under this system, a
24supplemental annuity equal to the difference in such amounts
25shall be payable to the participant.
26    (h) On January 1, 1981, an annuitant who was receiving a

 

 

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1retirement annuity on or before January 1, 1971 shall have his
2or her retirement annuity then being paid increased $1 per
3month for each year of creditable service. On January 1, 1982,
4an annuitant whose retirement annuity began on or before
5January 1, 1977, shall have his or her retirement annuity then
6being paid increased $1 per month for each year of creditable
7service.
8    (i) On January 1, 1987, any annuitant whose retirement
9annuity began on or before January 1, 1977, shall have the
10monthly retirement annuity increased by an amount equal to 8
11per year of creditable service times the number of years that
12have elapsed since the annuity began.
13(Source: P.A. 93-347, eff. 7-24-03; 94-4, eff. 6-1-05.)
 
14    (40 ILCS 5/15-136.4)
15    Sec. 15-136.4. Retirement and Survivor Benefits Under
16Portable Benefit Package.
17    (a) This Section 15-136.4 describes the form of annuity and
18survivor benefits available to a participant who has elected
19the portable benefit package and has completed the one-year
20waiting period required under subsection (e) of Section
2115-134.5. For purposes of this Section, the term "eligible
22spouse" means the husband or wife of a participant to whom the
23participant is married on the date the participant's annuity
24payment period begins, provided however, that if the
25participant should die prior to the commencement of retirement

 

 

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1annuity benefits, then "eligible spouse" means the husband or
2wife, if any, to whom the participant was married throughout
3the one-year period preceding the date of his or her death.
4    (b) This subsection (b) describes the normal form of
5annuity payable to a participant subject to this Section
615-136.4. If the participant is unmarried on the date his or
7her annuity payment period begins, then the annuity payments
8shall be made in the form of a single-life annuity as described
9in Section 15-118. If the participant is married on the date
10his or her annuity payments commence, then the annuity payments
11shall be paid in the form of a qualified joint and survivor
12annuity that is the actuarial equivalent of the single-life
13annuity. Under the "qualified joint and survivor annuity", a
14reduced amount shall be paid to the participant for his or her
15lifetime and his or her eligible spouse, if surviving at the
16participant's death, shall be entitled to receive thereafter a
17lifetime survivorship annuity in a monthly amount equal to 50%
18of the reduced monthly amount that was payable to the
19participant. The last payment of a qualified joint and survivor
20annuity shall be made as of the first day of the month in which
21the death of the survivor occurs.
22    (c) Instead of the normal form of annuity that would be
23paid under subsection (b), a participant may elect in writing
24within the 180-day 90-day period prior to the date his or her
25annuity payments commence to waive the normal form of annuity
26payment and receive an optional form of payment as described in

 

 

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1subsection (h). If the participant is married and elects an
2optional form of payment under subsection (h) other than a
3joint and survivor annuity with the eligible spouse designated
4as the contingent annuitant, then such election shall require
5the consent of his or her eligible spouse in the manner
6described in subsection (d). At any time during the 180-day
790-day period preceding the date the participant's payment
8period begins, the participant may revoke the optional form of
9payment elected under this subsection (c) and reinstate
10coverage under the qualified joint and survivor annuity without
11the spouse's consent, but an election to revoke the optional
12form elected and elect a new optional form of payment or
13designate a different contingent annuitant shall not be
14effective without the eligible spouse's consent.
15    (d) The eligible spouse's consent to any election made
16pursuant to this Section that requires the eligible spouse's
17consent shall be in writing and shall acknowledge the effect of
18the consent. In addition, the eligible spouse's signature on
19the written consent must be witnessed by a notary public. The
20eligible spouse's consent need not be obtained if the system is
21satisfied that there is no eligible spouse, that the eligible
22spouse cannot be located, or because of any other relevant
23circumstances. An eligible spouse's consent under this Section
24is valid only with respect to the specified optional form of
25payment and, if applicable, contingent annuitant designated by
26the participant. If the optional form of payment or the

 

 

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1contingent annuitant is subsequently changed (other than by a
2revocation of the optional form of payment and reinstatement of
3the qualified joint and survivor annuity), a new consent by the
4eligible spouse is required. The eligible spouse's consent to
5an election made by a participant pursuant to this Section,
6once made, may not be revoked by the eligible spouse.
7    (e) Within a reasonable period of time preceding the date a
8participant's annuity commences, a participant shall be
9supplied with a written explanation of (1) the terms and
10conditions of the normal form single-life annuity and qualified
11joint and survivor annuity, (2) the participant's right to
12elect a single-life annuity or an optional form of payment
13under subsection (h) subject to his or her eligible spouse's
14consent, if applicable, and (3) the participant's right to
15reinstate coverage under the qualified joint and survivor
16annuity prior to his or her annuity commencement date by
17revoking an election of an optional form of payment under
18subsection (h).
19    (f) If a married participant with at least 1.5 years of
20service dies prior to commencing retirement annuity payments
21and prior to taking a refund under Section 15-154, his or her
22eligible spouse is entitled to receive a pre-retirement
23survivor annuity, if there is not then in effect a waiver of
24the pre-retirement survivor annuity. The pre-retirement
25survivor annuity payable under this subsection shall be a
26monthly annuity payable for the eligible spouse's life,

 

 

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1commencing as of the beginning of the month next following the
2later of the date of the participant's death or the date the
3participant would have first met the eligibility requirements
4for retirement, and continuing through the beginning of the
5month in which the death of the eligible spouse occurs. The
6monthly amount payable to the spouse under the pre-retirement
7survivor annuity shall be equal to the monthly amount that
8would be payable as a survivor annuity under the qualified
9joint and survivor annuity described in subsection (b) if: (1)
10in the case of a participant who dies on or after the date on
11which the participant has met the eligibility requirements for
12retirement, the participant had retired with an immediate
13qualified joint and survivor annuity on the day before the
14participant's date of death; or (2) in the case of a
15participant who dies before the earliest date on which the
16participant would have met the eligibility requirements for
17retirement age, the participant had separated from service on
18the date of death, survived to the earliest retirement age
19based on service prior to his or her death, retired with an
20immediate qualified joint and survivor annuity at the earliest
21retirement age, and died on the day after the day on which the
22participant would have attained the earliest retirement age.
23    (g) A married participant who has not retired may elect at
24any time to waive the pre-retirement survivor annuity described
25in subsection (f). Any such election shall require the consent
26of the participant's eligible spouse in the manner described in

 

 

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1subsection (d). A waiver of the pre-retirement survivor annuity
2shall increase the lump sum death benefit payable under
3subsection (b) of Section 15-141. Prior to electing any waiver
4of the pre-retirement survivor annuity, the participant shall
5be provided with a written explanation of (1) the terms and
6conditions of the pre-retirement survivor annuity and the death
7benefits payable from the system both with and without the
8pre-retirement survivor annuity, (2) the participant's right
9to elect a waiver of the pre-retirement survivor annuity
10coverage subject to his or her spouse's consent, and (3) the
11participant's right to reinstate pre-retirement survivor
12annuity coverage at any time by revoking a prior waiver of such
13coverage.
14    (h) By filing a timely election with the system, a
15participant who will be eligible to receive a retirement
16annuity under this Section may waive the normal form of annuity
17payment described in subsection (b), subject to obtaining the
18consent of his or her eligible spouse, if applicable, and elect
19to receive any one of the following optional forms of payment:
20        (1) Joint and Survivor Annuity Options: The
21    participant may elect to receive a reduced annuity payable
22    for his or her life and to have a lifetime survivorship
23    annuity in a monthly amount equal to 50%, 75%, or 100% (as
24    elected by the participant) of that reduced monthly amount,
25    to be paid after the participant's death to his or her
26    contingent annuitant, if the contingent annuitant is alive

 

 

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1    at the time of the participant's death.
2        (2) Single-Life Annuity Option (optional for married
3    participants). The participant may elect to receive a
4    single-life annuity payable for his or her life only.
5        (3) Lump sum retirement benefit. The participant may
6    elect to receive a lump sum retirement benefit that is
7    equal to the amount of a refund payable under Section
8    15-154(a-2).
9All joint and survivor annuity forms shall be in an amount that
10is the actuarial equivalent of the single-life annuity.
11    For the purposes of this Section, the term "contingent
12annuitant" means the beneficiary who is designated by a
13participant at the time the participant elects a joint and
14survivor annuity to receive the lifetime survivorship annuity
15in the event the beneficiary survives the participant at the
16participant's death.
17    (i) Under no circumstances may an option be elected,
18changed, or revoked after the date the participant's retirement
19annuity commences.
20    (j) An election made pursuant to subsection (h) shall
21become inoperative if the participant or the contingent
22annuitant dies before the date the participant's annuity
23payments commence, or if the eligible spouse's consent is
24required and not given.
25    (k) (Blank).
26    (l) The automatic annual increases described in subsection

 

 

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1(d) of Section 15-136 shall apply to retirement benefits under
2the portable benefit package and the automatic annual increases
3described in subsection (j) of Section 15-145 shall apply to
4survivor benefits under the portable benefit package.
5(Source: P.A. 96-586, eff. 8-18-09.)
 
6    (40 ILCS 5/15-139)  (from Ch. 108 1/2, par. 15-139)
7    Sec. 15-139. Retirement annuities; cancellation; suspended
8during employment.
9    (a) If an annuitant returns to employment for an employer
10within 60 days after the beginning of the retirement annuity
11payment period, the retirement annuity shall be cancelled, and
12the annuitant shall refund to the System the total amount of
13the retirement annuity payments which he or she received. If
14the retirement annuity is cancelled, the participant shall
15continue to participate in the System.
16    (b) If an annuitant retires prior to age 60 and receives or
17becomes entitled to receive during any month compensation in
18excess of the monthly retirement annuity (including any
19automatic annual increases) for services performed after the
20date of retirement for any employer under this System, that
21portion of the monthly retirement annuity provided by employer
22contributions shall not be payable.
23    If an annuitant retires at age 60 or over and receives or
24becomes entitled to receive during any academic year
25compensation in excess of the difference between his or her

 

 

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1highest annual earnings prior to retirement and his or her
2annual retirement annuity computed under Rule 1, Rule 2, Rule
33, Rule 4, or Rule 5 of Section 15-136, or under Section
415-136.4, for services performed after the date of retirement
5for any employer under this System, that portion of the monthly
6retirement annuity provided by employer contributions shall be
7reduced by an amount equal to the compensation that exceeds
8such difference.
9    However, any remuneration received for serving as a member
10of the Illinois Educational Labor Relations Board shall be
11excluded from "compensation" for the purposes of this
12subsection (b), and serving as a member of the Illinois
13Educational Labor Relations Board shall not be deemed to be a
14return to employment for the purposes of this Section. This
15provision applies without regard to whether service was
16terminated prior to the effective date of this amendatory Act
17of 1991.
18    (c) If an employer certifies that an annuitant has been
19reemployed on a permanent and continuous basis or in a position
20in which the annuitant is expected to serve for at least 9
21months, the annuitant shall resume his or her status as a
22participating employee and shall be entitled to all rights
23applicable to participating employees upon filing with the
24board an election to forgo forego all annuity payments during
25the period of reemployment. Upon subsequent retirement, the
26retirement annuity shall consist of the annuity which was

 

 

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1terminated by the reemployment, plus the additional retirement
2annuity based upon service granted during the period of
3reemployment, but the combined retirement annuity shall not
4exceed the maximum annuity applicable on the date of the last
5retirement.
6    The total service and earnings credited before and after
7the initial date of retirement shall be considered in
8determining eligibility of the employee or the employee's
9beneficiary to benefits under this Article, and in calculating
10final rate of earnings.
11    In determining the death benefit payable to a beneficiary
12of an annuitant who again becomes a participating employee
13under this Section, accumulated normal and additional
14contributions shall be considered as the sum of the accumulated
15normal and additional contributions at the date of initial
16retirement and the accumulated normal and additional
17contributions credited after that date, less the sum of the
18annuity payments received by the annuitant.
19    The survivors insurance benefits provided under Section
2015-145 shall not be applicable to an annuitant who resumes his
21or her status as a participating employee, unless the
22annuitant, at the time of initial retirement, has a survivors
23insurance beneficiary who could qualify for such benefits.
24    If the participant's annuitant's employment is terminated
25because of circumstances other than death before 9 months from
26the date of reemployment, the provisions of this Section

 

 

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1regarding resumption of status as a participating employee
2shall not apply. The normal and survivors insurance
3contributions which are deducted during this period shall be
4refunded to the annuitant without interest, and subsequent
5benefits under this Article shall be the same as those which
6were applicable prior to the date the annuitant resumed
7employment.
8    The amendments made to this Section by this amendatory Act
9of the 91st General Assembly apply without regard to whether
10the annuitant was in service on or after the effective date of
11this amendatory Act.
12(Source: P.A. 91-887 (Sections 10 and 25), eff. 7-6-00; 92-16,
13eff. 6-28-01.)
 
14    (40 ILCS 5/15-139.5 new)
15    Sec. 15-139.5. Return to work by affected annuitant; notice
16and contribution by employer.
17    (a) An employer who employs or re-employs a person
18receiving a retirement annuity from the System in an academic
19year beginning on or after August 1, 2012 must notify the
20System of that employment within 60 days after employing the
21annuitant. The notice must include a copy of the contract of
22employment; if no written contract of employment exists, then
23the notice must specify the rate of compensation and the
24anticipated length of employment of that annuitant. The notice
25must specify whether the annuitant will be compensated from

 

 

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1federal, foundation, or trust funds. The notice must include
2the employer's determination of whether or not the annuitant is
3an "affected annuitant" as defined in subsection (b).
4    The employer must also record, document, and certify to the
5System (i) the number of paid days and paid weeks worked by the
6annuitant in the academic year, (ii) the amount of compensation
7paid to the annuitant for employment during the academic year,
8and (iii) the amount of that compensation, if any, that comes
9from federal, foundation, or trust funds.
10    As used in this Section, "paid day" means a day on which a
11person performs personal services for an employer and for which
12the person is compensated by the employer; and "paid week"
13means a calendar week in which a person has at least one paid
14day.
15    For the purposes of this Section, an annuitant whose
16employment by an employer extends over more than one academic
17year shall be deemed to be re-employed by that employer in each
18of those academic years.
19    The System may specify the time, form, and manner of
20providing the determinations, notifications, certifications,
21and documentation required under this Section.
22    (b) A person receiving a retirement annuity from the System
23becomes an "affected annuitant" on the first day of the
24academic year following the academic year in which the
25annuitant first meets both of the following conditions:
26        (1) While receiving a retirement annuity under this

 

 

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1    Article, the annuitant has been employed on or after August
2    1, 2012 by one or more employers under this Article for a
3    total of more than 18 paid weeks (which need not have been
4    with the same employer or in the same academic year);
5    except that any periods of employment for which the
6    annuitant was compensated solely from federal, foundation,
7    or trust funds are excluded.
8        (2) While receiving a retirement annuity under this
9    Article, the annuitant was employed on or after August 1,
10    2012 by one or more employers under this Article and
11    received or became entitled to receive during an academic
12    year compensation for that employment in excess of 40% of
13    his or her highest annual earnings prior to retirement;
14    except that compensation paid from federal, foundation, or
15    trust funds is excluded.
16    A person who becomes an affected annuitant remains an
17affected annuitant, except for any period during which the
18person returns to active service and does not receive a
19retirement annuity from the System.
20    (c) It is the obligation of the employer to determine
21whether an annuitant is an affected annuitant before employing
22the annuitant. For that purpose the employer may require the
23annuitant to disclose and document his or her relevant prior
24employment and earnings history. Failure of the employer to
25make this determination correctly and in a timely manner or to
26include this determination with the notification required

 

 

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1under subsection (a) does not excuse the employer from making
2the contribution required under subsection (e).
3    The System may assist the employer in determining whether a
4person is an affected annuitant. The System shall inform the
5employer if it discovers that the employer's determination is
6inconsistent with the employment and earnings information in
7the System's records.
8    (d) Upon the request of an annuitant, the System shall
9certify to the annuitant the following information as reported
10by the employers, as that information is indicated in the
11records of the System: (i) the annuitant's highest annual
12earnings prior to retirement, (ii) the number of paid weeks
13worked by the annuitant for an employer on or after August 1,
142012, (iii) the compensation paid for that employment in each
15academic year, and (iv) whether any of that employment or
16compensation has been certified to the System as being paid
17from federal, foundation, or trust funds. The System shall only
18be required to certify information that is received from the
19employers.
20    (e) In addition to the requirements of subsection (a), an
21employer who employs an affected annuitant must pay to the
22System an employer contribution in the amount and manner
23provided in this Section, unless the annuitant is compensated
24by that employer solely from federal, foundation, or trust
25funds.
26    The employer contribution required under this Section for

 

 

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1employment of an affected annuitant in an academic year shall
2be equal to 12 times the amount of the gross monthly retirement
3annuity payable to the annuitant for the month in which the
4first paid day of that employment in that academic year occurs,
5after any reduction in that annuity that may be imposed under
6subsection (b) of Section 15-139.
7    If an affected annuitant is employed by more than one
8employer in an academic year, the employer contribution
9required under this Section shall be divided among those
10employers in proportion to their respective portions of the
11total compensation paid to the affected annuitant for that
12employment during that academic year.
13    If the System determines that an employer, without
14reasonable justification, has failed to make the determination
15of affected annuitant status correctly and in a timely manner,
16or has failed to notify the system or to correctly document or
17certify to the System any of the information required by this
18Section, and that failure results in a delayed determination by
19the System that a contribution is payable under this Section,
20then the amount of that employer's contribution otherwise
21determined under this Section shall be doubled.
22    The System shall deem a failure to correctly determine the
23annuitant's status to be justified if the employer establishes
24to the System's satisfaction that the employer, after due
25diligence, made an erroneous determination that the annuitant
26was not an affected annuitant due to reasonable reliance on

 

 

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1false or misleading information provided by the annuitant or
2another employer, or an error in the annuitant's official
3employment or earnings records.
4    (f) Whenever the System determines that an employer is
5liable for a contribution under this Section, it shall so
6notify the employer and certify the amount of the contribution.
7The employer may pay the required contribution without interest
8at any time within one year after receipt of the certification.
9If the employer fails to pay within that year, then interest
10shall be charged at a rate equal to the System's prescribed
11rate of interest, compounded annually from the 366th day after
12receipt of the certification from the System. Payment must be
13concluded within 2 years after receipt of the certification by
14the employer. If the employer fails to make complete payment,
15including applicable interest, within 2 years, then the System
16may, after giving notice to the employer, certify the
17delinquent amount to the State Comptroller, and the Comptroller
18shall thereupon deduct the certified delinquent amount from
19State funds payable to the employer and pay them instead to the
20System.
21    (g) If an employer is required to make a contribution to
22the System as a result of employing an affected annuitant and
23the annuitant later elects to forgo his or her annuity in that
24same academic year pursuant to subsection (c) of Section
2515-139, then the required contribution by the employer shall be
26waived, and if the contribution has already been paid, it shall

 

 

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1be refunded to the employer without interest.
2    (h) Notwithstanding any other provision of this Article,
3the employer contribution required under this Section shall not
4be included in the determination of any benefit under this
5Article or any other Article of this Code, regardless of
6whether the annuitant returns to active service, and is in
7addition to any other State or employer contribution required
8under this Article.
 
9    (40 ILCS 5/15-153.2)  (from Ch. 108 1/2, par. 15-153.2)
10    Sec. 15-153.2. Disability retirement annuity. A
11participant whose disability benefits are discontinued under
12the provisions of clause (6) of Section 15-152 and who is not a
13participant in the optional retirement plan established under
14Section 15-158.2 is entitled to a disability retirement annuity
15of 35% of the basic compensation which was payable to the
16participant at the time that disability began, provided that
17the board determines that the participant has a medically
18determinable physical or mental impairment that prevents him or
19her from engaging in any substantial gainful activity, and
20which can be expected to result in death or which has lasted or
21can be expected to last for a continuous period of not less
22than 12 months.
23    The board's determination of whether a participant is
24disabled shall be based upon:
25        (i) a written certificate from one or more licensed and

 

 

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1    practicing physicians appointed by or acceptable to the
2    board, stating that the participant is unable to engage in
3    any substantial gainful activity; and
4        (ii) any other medical examinations, hospital records,
5    laboratory results, or other information necessary for
6    determining the employment capacity and condition of the
7    participant.
8    The terms "medically determinable physical or mental
9impairment" and "substantial gainful activity" shall have the
10meanings ascribed to them in the federal Social Security Act,
11as now or hereafter amended, and the regulations issued
12thereunder.
13    The disability retirement annuity payment period shall
14begin immediately following the expiration of the disability
15benefit payments under clause (6) of Section 15-152 and shall
16be discontinued for a recipient of a disability retirement
17annuity when (1) the physical or mental impairment no longer
18prevents the participant from engaging in any substantial
19gainful activity, (2) the participant dies or (3) the
20participant elects to receive a retirement annuity under
21Sections 15-135 and 15-136. If a person's disability retirement
22annuity is discontinued under clause (1), all rights and
23credits accrued in the system on the date that the disability
24retirement annuity began shall be restored, and the disability
25retirement annuity paid shall be considered as disability
26payments under clause (6) of Section 15-152.

 

 

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1(Source: P.A. 90-14, eff. 7-1-97; 90-65, eff. 7-7-97; 90-511,
2eff. 8-22-97; 90-766, eff. 8-14-98.)
 
3    (40 ILCS 5/15-168.2 new)
4    Sec. 15-168.2. Audit of employers. Beginning August 1,
52012, the System may audit the employment records and payroll
6records of all employers. When the System audits an employer,
7it shall specify the exact information it requires, which may
8include but need not be limited to the names, titles, and
9earnings history of every individual receiving compensation
10from the employer. If an employer is audited by the System,
11then the employer must provide to the System all necessary
12documents and records within 60 calendar days after receiving
13notification from the System. When the System audits an
14employer, it shall send related correspondence by certified
15mail.
 
16    (40 ILCS 5/15-186)  (from Ch. 108 1/2, par. 15-186)
17    Sec. 15-186. Fraud.
18    Any person who knowingly makes any false statement, or
19falsifies or permits to be falsified any record or records of
20this system, in any attempt to defraud the system or to mislead
21or defraud an employer with respect to employment of an
22annuitant under Section 15-139.5, is guilty of a Class A
23misdemeanor.
24(Source: P.A. 77-2830.)
 

 

 

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1    Section 99. Effective date. This Act takes effect July 1,
22012.