HB3408eng 99TH GENERAL ASSEMBLY

HB3408 Engrossed LRB099 10200 EFG 30425 b

AN ACT concerning public employee benefits.

Be it enacted by the People of the State of Illinois, represented in the General Assembly:

Section 5. The Illinois Pension Code is amended by changing Sections 15-110 and 15-111 and by adding Section 15-111.5 as follows:

(40 ILCS 5/15-110) (from Ch. 108 1/2, par. 15-110)

Sec. 15-110. Basic compensation. "Basic compensation": Subject to Section 15-111.5, the The gross basic rate of salary or wages payable by an employer, including:

(1) the value of maintenance, board, living quarters, personal laundry or other allowances furnished in lieu of salary which are considered gross income under the federal Federal Internal Revenue Code of 1986, as amended; ,

(2) the employee contributions required under Section 15-157; , and

(3) the amount paid by any employer to a custodial account for investment in regulated investment company stocks for the benefit of the employee pursuant to the University Employees Custodial Accounts Act; "An Act in relation to payments to custodial accounts for the benefit of employees of public institutions of higher education", approved September 9, 1983, and

(4) the amount of the premium payable by any employer to an insurance company or companies on an annuity contract, pursuant to the employee's election to accept a reduction in earnings or forego an increase in earnings under Section 30c of the State Finance Act "An Act in relation to State Finance," approved June 10, 1919, as amended, or a tax-sheltered annuity plan approved by any employer; and

(5) the amount of any elective deferral to a deferred compensation plan established under Article 24 of this Code pursuant to Section 457(b) of the federal Internal Revenue Code of 1986, as amended.

Basic compensation does not include (1) salary or wages for overtime or other extra service; (2) prospective salary or wages under a summer teaching contract not yet entered upon; and (3) overseas differential allowances, quarters allowances, post allowances, educational allowances and transportation allowances paid by an employer under a contract with the federal government or its agencies for services rendered in other countries. If an employee elects to receive in lieu of cash salary or wages, fringe benefits which are not taxable under the federal Federal Internal Revenue Code of 1986, as amended, the amount of the cash salary or wages which is waived shall be included in determining basic compensation.

(Source: P.A. 84-1308.)

(40 ILCS 5/15-111) (from Ch. 108 1/2, par. 15-111)

(Text of Section WITHOUT the changes made by P.A. 98-599, which has been held unconstitutional)

Sec. 15-111. Earnings.

(a) "Earnings": Subject to Section 15-111.5, an An amount paid for personal services equal to the sum of the basic compensation plus extra compensation for summer teaching, overtime or other extra service. For periods for which an employee receives service credit under subsection (c) of Section 15-113.1 or Section 15-113.2, earnings are equal to the basic compensation on which contributions are paid by the employee during such periods. Compensation for employment which is irregular, intermittent and temporary shall not be considered earnings, unless the participant is also receiving earnings from the employer as an employee under Section 15-107.

With respect to transition pay paid by the University of Illinois to a person who was a participating employee employed in the fire department of the University of Illinois's Champaign-Urbana campus immediately prior to the elimination of that fire department:

(1) "Earnings" includes transition pay paid to the employee on or after the effective date of this amendatory Act of the 91st General Assembly.

(2) "Earnings" includes transition pay paid to the employee before the effective date of this amendatory Act of the 91st General Assembly only if (i) employee contributions under Section 15-157 have been withheld from that transition pay or (ii) the employee pays to the System before January 1, 2001 an amount representing employee contributions under Section 15-157 on that transition pay. Employee contributions under item (ii) may be paid in a lump sum, by withholding from additional transition pay accruing before January 1, 2001, or in any other manner approved by the System. Upon payment of the employee contributions on transition pay, the corresponding employer contributions become an obligation of the State.

(b) For a Tier 2 member, the annual earnings shall not exceed $106,800; however, that amount shall annually thereafter be increased by the lesser of (i) 3% of that amount, including all previous adjustments, or (ii) one half the annual unadjusted percentage increase (but not less than zero) in the consumer price index-u for the 12 months ending with the September preceding each November 1, including all previous adjustments.

For the purposes of this Section, "consumer price index u" means the index published by the Bureau of Labor Statistics of the United States Department of Labor that measures the average change in prices of goods and services purchased by all urban consumers, United States city average, all items, 1982-84 = 100. The new amount resulting from each annual adjustment shall be determined by the Public Pension Division of the Department of Insurance and made available to the boards of the retirement systems and pension funds by November 1 of each year.

(Source: P.A. 98-92, eff. 7-16-13.)

(40 ILCS 5/15-111.5 new)

Sec. 15-111.5. Basic compensation and earnings restrictions. For an employee who first becomes a participant on or after the effective date of this amendatory Act of the 99th General Assembly, basic compensation under Section 15-110 and earnings under Section 15-111 shall not include housing allowances, vehicle allowances, or club memberships dues.

Section 99. Effective date. This Act takes effect upon becoming law.