Illinois General Assembly - Full Text of HB0418
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Full Text of HB0418  100th General Assembly




HB0418 EnrolledLRB100 04239 RPS 14245 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 3-109.1, 3-124.1, and 7-109 and by adding Section
63-109.4 as follows:
7    (40 ILCS 5/3-109.1)  (from Ch. 108 1/2, par. 3-109.1)
8    Sec. 3-109.1. Chief of police.
9    (a) Except as provided in subsection (a-5), beginning
10Beginning January 1, 1990, any person who is employed as the
11chief of police of a "participating municipality" as defined in
12Section 7-106 of this Code, may elect to participate in the
13Illinois Municipal Retirement Fund rather than in a fund
14created under this Article 3. Except as provided in subsection
15(b), this election shall be irrevocable, and shall be filed in
16writing with the Board of the Illinois Municipal Retirement
18    (a-5) On or after January 1, 2019, a person may not elect
19to participate in the Illinois Municipal Retirement Fund with
20respect to his or her employment as the chief of police of a
21participating municipality, unless that person became a
22participating employee in the Illinois Municipal Retirement
23Fund before January 1, 2019.



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1    (b) Until January 1, 1999, a chief of police who has
2elected under this Section to participate in IMRF rather than a
3fund created under this Article may elect to rescind that
4election and transfer his or her participation to the police
5pension fund established under this Article by the employing
6municipality. The chief must notify the boards of trustees of
7both funds in writing of his or her decision to rescind the
8election and transfer participation. A chief of police who
9transfers participation under this subsection (b) shall not be
10deemed ineligible to participate in the police pension fund by
11reason of having failed to apply within the 3-month period
12specified in Section 3-106.
13(Source: P.A. 90-460, eff. 8-17-97.)
14    (40 ILCS 5/3-109.4 new)
15    Sec. 3-109.4. Defined contribution plan for certain police
17    (a) Each municipality shall establish a defined
18contribution plan that aggregates police officer and employer
19contributions in individual accounts used for retirement. The
20defined contribution plan, including both police officer and
21employer contributions, established by the municipality must,
22at a minimum: meet the safe harbor provisions of the Internal
23Revenue Code of 1986, as amended; be a qualified plan under the
24Internal Revenue Code of 1986, as amended; and comply with all
25other applicable laws, rules, and regulations. Contributions



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1shall vest immediately upon deposit in the police officer's
3    A police officer who participates in the defined
4contribution plan under this Section may not earn creditable
5service or otherwise participate in the defined benefit plan
6offered by his or her employing municipality, except as an
7annuitant in another fund or as a survivor, while he or she is
8a participant in the defined contribution plan. The defined
9contribution plan under this Section shall not be construed to
10be a pension, annuity, or other defined benefit under this
12    (b) If a police officer who has more than 10 years of
13creditable service in a fund enters active service with a
14different municipality, he or she may elect to participate in
15the defined contribution plan under this Section in lieu of the
16defined benefit plan.
17    A police officer who has elected under this subsection to
18participate in the defined contribution plan may, in writing,
19rescind that election in accordance with the rules of the
20board. Any employer contributions, and the earnings thereon,
21shall remain vested in the police officer's account. A police
22officer who rescinds the election may begin participating in
23the defined benefit plan on the first day of the month
24following the rescission.
25    (c) As used in this Section, "defined benefit plan" means
26the retirement plan available to police officers under this



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1Article who do not participate in the defined contribution plan
2under this Section.
3    (40 ILCS 5/3-124.1)  (from Ch. 108 1/2, par. 3-124.1)
4    Sec. 3-124.1. Re-entry into active service.
5    (a) If a police officer who is receiving pension payments
6other than as provided in Section 3-109.3 re-enters active
7service, pension payment shall be suspended while he or she is
8in service. When he or she again retires, pension payments
9shall be resumed. If the police officer remains in service
10after re-entry for a period of less than 5 years, the pension
11shall be the same as upon first retirement. If the officer's
12service after re-entry is at least 5 years and the officer
13makes the required contributions during the period of re-entry,
14his or her pension shall be recomputed by taking into account
15the additional period of service and salary.
16    (b) If a police officer who first becomes a member on or
17after January 1, 2019 is receiving pension payments (other than
18as provided in Section 3-109.3) and re-enters active service
19with any municipality that has established a pension fund under
20this Article, that police officer may continue to receive
21pension payments while he or she is in active service, but
22shall only participate in a defined contribution plan
23established by the municipality pursuant to Section 3-109.4 and
24may not establish creditable service in the pension fund
25established by that municipality or have his or her pension



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2(Source: P.A. 91-939, eff. 2-1-01.)
3    (40 ILCS 5/7-109)  (from Ch. 108 1/2, par. 7-109)
4    Sec. 7-109. Employee.
5    (1) "Employee" means any person who:
6        (a) 1. Receives earnings as payment for the performance
7    of personal services or official duties out of the general
8    fund of a municipality, or out of any special fund or funds
9    controlled by a municipality, or by an instrumentality
10    thereof, or a participating instrumentality, including, in
11    counties, the fees or earnings of any county fee office;
12    and
13        2. Under the usual common law rules applicable in
14    determining the employer-employee relationship, has the
15    status of an employee with a municipality, or any
16    instrumentality thereof, or a participating
17    instrumentality, including aldermen, county supervisors
18    and other persons (excepting those employed as independent
19    contractors) who are paid compensation, fees, allowances
20    or other emolument for official duties, and, in counties,
21    the several county fee offices.
22        (b) Serves as a township treasurer appointed under the
23    School Code, as heretofore or hereafter amended, and who
24    receives for such services regular compensation as
25    distinguished from per diem compensation, and any regular



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1    employee in the office of any township treasurer whether or
2    not his earnings are paid from the income of the permanent
3    township fund or from funds subject to distribution to the
4    several school districts and parts of school districts as
5    provided in the School Code, or from both such sources; or
6    is the chief executive officer, chief educational officer,
7    chief fiscal officer, or other employee of a Financial
8    Oversight Panel established pursuant to Article 1H of the
9    School Code, other than a superintendent or certified
10    school business official, except that such person shall not
11    be treated as an employee under this Section if that person
12    has negotiated with the Financial Oversight Panel, in
13    conjunction with the school district, a contractual
14    agreement for exclusion from this Section.
15        (c) Holds an elective office in a municipality,
16    instrumentality thereof or participating instrumentality.
17    (2) "Employee" does not include persons who:
18        (a) Are eligible for inclusion under any of the
19    following laws:
20            1. "An Act in relation to an Illinois State
21        Teachers' Pension and Retirement Fund", approved May
22        27, 1915, as amended;
23            2. Articles 15 and 16 of this Code.
24        However, such persons shall be included as employees to
25    the extent of earnings that are not eligible for inclusion
26    under the foregoing laws for services not of an



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1    instructional nature of any kind.
2        However, any member of the armed forces who is employed
3    as a teacher of subjects in the Reserve Officers Training
4    Corps of any school and who is not certified under the law
5    governing the certification of teachers shall be included
6    as an employee.
7        (b) Are designated by the governing body of a
8    municipality in which a pension fund is required by law to
9    be established for policemen or firemen, respectively, as
10    performing police or fire protection duties, except that
11    when such persons are the heads of the police or fire
12    department and are not eligible to be included within any
13    such pension fund, they shall be included within this
14    Article; provided, that such persons shall not be excluded
15    to the extent of concurrent service and earnings not
16    designated as being for police or fire protection duties.
17    However, (i) any head of a police department who was a
18    participant under this Article immediately before October
19    1, 1977 and did not elect, under Section 3-109 of this Act,
20    to participate in a police pension fund shall be an
21    "employee", and (ii) any chief of police who became a
22    participating employee under this Article before January
23    1, 2019 and who elects to participate in this Fund under
24    Section 3-109.1 of this Code, regardless of whether such
25    person continues to be employed as chief of police or is
26    employed in some other rank or capacity within the police



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1    department, shall be an employee under this Article for so
2    long as such person is employed to perform police duties by
3    a participating municipality and has not lawfully
4    rescinded that election.
5        (c) Are contributors to or eligible to contribute to a
6    Taft-Hartley pension plan to which the participating
7    municipality is required to contribute as the person's
8    employer based on earnings from the municipality. Nothing
9    in this paragraph shall affect service credit or creditable
10    service for any period of service prior to the effective
11    date of this amendatory Act of the 98th General Assembly,
12    and this paragraph shall not apply to individuals who are
13    participating in the Fund prior to the effective date of
14    this amendatory Act of the 98th General Assembly.
15        (d) Become an employee of any of the following
16    participating instrumentalities on or after the effective
17    date of this amendatory Act of the 99th General Assembly:
18    the Illinois Municipal League; the Illinois Association of
19    Park Districts; the Illinois Supervisors, County
20    Commissioners and Superintendents of Highways Association;
21    an association, or not-for-profit corporation, membership
22    in which is authorized under Section 85-15 of the Township
23    Code; the United Counties Council; or the Will County
24    Governmental League.
25    (3) All persons, including, without limitation, public
26defenders and probation officers, who receive earnings from



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1general or special funds of a county for performance of
2personal services or official duties within the territorial
3limits of the county, are employees of the county (unless
4excluded by subsection (2) of this Section) notwithstanding
5that they may be appointed by and are subject to the direction
6of a person or persons other than a county board or a county
7officer. It is hereby established that an employer-employee
8relationship under the usual common law rules exists between
9such employees and the county paying their salaries by reason
10of the fact that the county boards fix their rates of
11compensation, appropriate funds for payment of their earnings
12and otherwise exercise control over them. This finding and this
13amendatory Act shall apply to all such employees from the date
14of appointment whether such date is prior to or after the
15effective date of this amendatory Act and is intended to
16clarify existing law pertaining to their status as
17participating employees in the Fund.
18(Source: P.A. 98-712, eff. 7-16-14; 99-830, eff. 1-1-17.)
19    Section 90. The State Mandates Act is amended by adding
20Section 8.41 as follows:
21    (30 ILCS 805/8.41 new)
22    Sec. 8.41. Exempt mandate. Notwithstanding Sections 6 and 8
23of this Act, no reimbursement by the State is required for the
24implementation of any mandate created by this amendatory Act of



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1the 100th General Assembly.
2    Section 99. Effective date. This Act takes effect upon
3becoming law.