093_SB0309sam001











                                     LRB093 03841 LRD 12693 a

 1                    AMENDMENT TO SENATE BILL 309

 2        AMENDMENT NO.     .  Amend Senate Bill 309  by  replacing
 3    everything after the enacting clause with the following:

 4        "Section  5.   The  Illinois  Pension  Code is amended by
 5    changing Section 1-119 as follows:

 6        (40 ILCS 5/1-119)
 7        Sec.  1-119.   Qualified  Illinois   Domestic   Relations
 8    Orders.
 9        (a)  For the purposes of this Section:
10             (1)  "Alternate  payee"  means  the  spouse,  former
11        spouse,  child,  or  other  dependent  of  a  member,  as
12        designated in a QILDRO.
13             (2)  "Death benefit" means a any nonperiodic benefit
14        payable  upon  the death of a member to a survivor of the
15        member  or  to  the   member's   estate   or   designated
16        beneficiary,   including   any  refund  of  contributions
17        following the member's death, whether or not the  benefit
18        is so called under the applicable Article of this Code.
19             (3)  "Disability  benefit"  means  any  periodic  or
20        nonperiodic benefit payable to a disabled member based on
21        occupational  or  nonoccupational  disability or disease,
22        including any periodic or nonperiodic  increases  in  the
 
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 1        benefit,  whether  or  not the benefit is so called under
 2        the applicable Article of this Code.
 3             (4)  "Member" means any person who  participates  in
 4        or  has service credits in a retirement system, including
 5        a person who is receiving or is  eligible  to  receive  a
 6        retirement  or  disability  benefit,  without  regard  to
 7        whether the person has withdrawn from service.
 8             (5)  "Member's  refund"  means  a return of all or a
 9        portion of a member's contributions that  is  elected  by
10        the  member  (or  provided  by  operation  of law) and is
11        payable before the member's death.
12             (6)  "Qualified Illinois Domestic  Relations  Order"
13        or "QILDRO" means an Illinois court order that creates or
14        recognizes the existence of an alternate payee's right to
15        receive  all  or a portion of a member's accrued benefits
16        in a  retirement  system,  is  issued  pursuant  to  this
17        Section  and  Section  503(b)(2) of the Illinois Marriage
18        and  Dissolution  of  Marriage   Act,   and   meets   the
19        requirements  of  this Section.  A QILDRO is not the same
20        as a qualified domestic relations order  or  QDRO  issued
21        pursuant  to  Section 414(p) of the Internal Revenue Code
22        of 1986.  The requirements of paragraphs (2) and  (3)  of
23        that  Section  do  not  apply to orders issued under this
24        Section  and  shall  not  be  deemed  a  guide   to   the
25        interpretation  of  this Section; a QILDRO is intended to
26        be a domestic  relations  order  within  the  meaning  of
27        paragraph (11) of that Section.
28             (7)  "Regular  payee"  means  the  person  to whom a
29        benefit would be payable in the absence of  an  effective
30        QILDRO.
31             (8)  "Retirement  benefit"  means  any  periodic  or
32        nonperiodic  benefit payable to a retired member based on
33        age or service, or on  the  amounts  accumulated  to  the
34        credit  of  the member for retirement purposes, including
 
                            -3-      LRB093 03841 LRD 12693 a
 1        any periodic or nonperiodic  increases  in  the  benefit,
 2        whether  or  not  the  benefit  is  so  called  under the
 3        applicable Article of this Code.
 4             (9)  "Retirement  system"  or  "system"  means   any
 5        retirement system, pension fund, or other public employee
 6        retirement benefit plan that is maintained or established
 7        under any of Articles 2 through 18 of this Code.
 8             (10)  "Surviving  spouse"  means  the  spouse  of  a
 9        member at the time of the member's death.
10             (11)  "Survivor's   benefit"   means   any  periodic
11        benefit payable to a surviving spouse, child, parent,  or
12        other  survivor  of  a  deceased  member,  including  any
13        periodic or nonperiodic increases in the benefit, whether
14        or  not  the  benefit  is  so called under the applicable
15        Article of this Code.
16        (b) (1)  An Illinois court of competent jurisdiction in a
17    proceeding for declaration of invalidity of  marriage,  legal
18    separation,  or dissolution of marriage that provides for the
19    distribution of property,  or  any  proceeding  to  amend  or
20    enforce  such  a property distribution, may order that all or
21    any part of any  (i)  retirement  benefit  or  (ii)  member's
22    refund  payable to or on behalf of the member be instead paid
23    by the retirement system to a designated alternate payee.
24        (2)  An order issued under this Section provides only for
25    the diversion to  an  alternate  payee  of  certain  benefits
26    otherwise   payable   by  the  retirement  system  under  the
27    provisions of this Code.  The existence of a QILDRO shall not
28    cause the retirement system to pay any benefit, or any amount
29    of benefit, to an alternate payee that would  not  have  been
30    payable  by  the  system to a regular payee in the absence of
31    the QILDRO.
32        (3)  A QILDRO shall not affect the vesting,  accrual,  or
33    amount  of any benefit, nor the date or conditions upon which
34    any benefit becomes payable, nor the right of the  member  or
 
                            -4-      LRB093 03841 LRD 12693 a
 1    the   member's  survivors  to  make  any  election  otherwise
 2    authorized under this Code, except as provided in subsections
 3    (i) and (j).
 4        (4)  A QILDRO shall not apply to or affect the payment of
 5    any survivor's benefit, death  benefit,  disability  benefit,
 6    life insurance benefit, or health insurance benefit.
 7        (c) (1)  A   QILDRO  must  contain  the  name,  residence
 8    address, and social security number of the member and of  the
 9    alternate  payee  and  must identify the retirement system to
10    which it is directed and the court issuing the order.
11        (2)  A QILDRO must  specify  each  benefit  to  which  it
12    applies,  and it must specify the amount of the benefit to be
13    paid  to  the  alternate  payee,  which  in  the  case  of  a
14    nonperiodic benefit shall be expressed as  a  dollar  amount,
15    and in the case of a periodic benefit shall be expressed as a
16    dollar amount per month.
17        (3)  With  respect to each benefit to which it applies, a
18    QILDRO must specify when the order will take effect.  In  the
19    case of a periodic benefit that is being paid at the time the
20    order  is received, a QILDRO shall take effect immediately or
21    on a specified later date; if it takes effect immediately, it
22    shall become effective on  the  first  benefit  payment  date
23    occurring at least 30 days after the order is received by the
24    retirement  system.   In  the  case  of  any other benefit, a
25    QILDRO shall take effect when the  benefit  becomes  payable.
26    However, in no event shall a QILDRO apply to any benefit paid
27    by  the  retirement system before or within 30 days after the
28    order is received.  A retirement system may  adopt  rules  to
29    prorate  the  amount of the first and final periodic payments
30    to an alternate payee.
31        (4)  A QILDRO must also contain any  provisions  required
32    under subsection (n) or (p).
33        (d) (1)  An  order issued under this Section shall not be
34    implemented unless a certified copy of  the  order  has  been
 
                            -5-      LRB093 03841 LRD 12693 a
 1    filed  with the retirement system.  The system shall promptly
 2    notify the member and the alternate payee by first class mail
 3    of its receipt of the order.
 4        (2)  Neither the retirement system, nor  its  board,  nor
 5    any  of  its  employees  shall  be  liable to the member, the
 6    regular payee, or any  other  person  for  any  amount  of  a
 7    benefit  that  is paid in good faith to an alternate payee in
 8    accordance with a QILDRO.
 9        (3)  At the time the order is submitted to the retirement
10    system, it  shall  be  accompanied  by  a  nonrefundable  $50
11    processing  fee  payable to the retirement system, to be used
12    by the system to defer any administrative costs  arising  out
13    of the implementation of the QILDRO.
14        (e) (1)  Each   alternate   payee   is   responsible  for
15    maintaining a current residence  address  on  file  with  the
16    retirement  system.  The retirement system shall have no duty
17    to attempt to locate any alternate payee by any  means  other
18    than  sending written notice to the last known address of the
19    alternate payee on file with the system.
20        (2)  In the  event  that  the  system  cannot  locate  an
21    alternate  payee  when  a benefit becomes payable, the system
22    shall hold the amount of the benefit payable to the alternate
23    payee and make payment to the alternate payee if he or she is
24    located within the following  180  days.   If  the  alternate
25    payee  has not been located within 180 days from the date the
26    benefit becomes payable, the system shall pay the benefit and
27    the amounts held to the  regular  payee.   If  the  alternate
28    payee  is  subsequently  located,  the system shall thereupon
29    implement the QILDRO, but the interest of the alternate payee
30    in any amounts already paid to the  regular  payee  shall  be
31    extinguished.   Amounts  held under this subsection shall not
32    bear interest.
33        (f) (1)  If the amount of a benefit that is specified  in
34    a  QILDRO   for  payment  to  an  alternate payee exceeds the
 
                            -6-      LRB093 03841 LRD 12693 a
 1    actual amount of  that  benefit  payable  by  the  retirement
 2    system,  the  excess  shall  be  disregarded.  The retirement
 3    system shall have no liability to any alternate payee or  any
 4    other person for the disregarded amounts.
 5        (2)  In  the  event of multiple QILDROs against a member,
 6    the retirement system shall honor all of the QILDROs  to  the
 7    extent  possible.   However, if the total amount of a benefit
 8    to be paid to alternate payees under all  QILDROs  in  effect
 9    against  the member exceeds the actual amount of that benefit
10    payable by the system, the QILDROs shall be satisfied in  the
11    order  of their receipt by the system until the amount of the
12    benefit is exhausted, and shall not  be  adjusted  pro  rata.
13    Any  amounts  that  cannot  be  paid due to exhaustion of the
14    benefit shall remain unpaid, and the retirement system  shall
15    have  no liability to any alternate payee or any other person
16    for such amounts.
17        (3)  A modification of a QILDRO shall be filed  with  the
18    retirement  system  in  the  same  manner as a new QILDRO.  A
19    modification that does not increase the amount of any benefit
20    payable to the alternate  payee,  and  does  not  expand  the
21    QILDRO  to  affect any benefit not affected by the unmodified
22    QILDRO,  does  not  affect  the  priority  of  payment  under
23    subdivision (f)(2); the priority of payment of a QILDRO  that
24    has  been  modified  to  increase  the  amount of any benefit
25    payable to the alternate payee, or to expand  the  QILDRO  to
26    affect a benefit not affected by the unmodified QILDRO, shall
27    be  based  on  the  date  on  which  the  system receives the
28    modification of the QILDRO.
29        (g) (1)  Upon the death of the alternate  payee  under  a
30    QILDRO,  the  QILDRO  shall expire and cease to be effective,
31    and in the absence of another QILDRO, the  right  to  receive
32    any affected benefit shall revert to the regular payee.
33        (2)  All  QILDROs relating to a member's participation in
34    a particular retirement system shall expire and cease  to  be
 
                            -7-      LRB093 03841 LRD 12693 a
 1    effective  upon  the  issuance  of  a  member's  refund  that
 2    terminates  the  member's  participation  in  that retirement
 3    system, without regard to whether the refund was paid to  the
 4    member  or  to an alternate payee under a QILDRO.  An expired
 5    QILDRO shall not be automatically revived by  any  subsequent
 6    return by the member to service under that retirement system.
 7        (h) (1)  Within  45  days after receiving a subpoena from
 8    any party to a proceeding for declaration  of  invalidity  of
 9    marriage,  legal  separation,  or  dissolution of marriage in
10    which a QILDRO may be issued, or after  receiving  a  request
11    from  the member, a retirement system shall issue a statement
12    of a member's accumulated  contributions,  accrued  benefits,
13    and   other   interests  in  the  plan  administered  by  the
14    retirement system based on the data on file with  the  system
15    on  the  date  the  subpoena is received, and of any relevant
16    procedures, rules, or modifications to the model QILDRO  form
17    that have been adopted by the retirement system.
18        (2)  In  no event shall the retirement system be required
19    to furnish to any person  an  actuarial  opinion  as  to  the
20    present value of the member's benefits or other interests.
21        (3)  The  papers, entries, and records, or parts thereof,
22    of any retirement system may be proved  by  a  copy  thereof,
23    certified  under the signature of the secretary of the system
24    or other duly appointed keeper of the records of  the  system
25    and the corporate seal, if any.
26        (i)  In   a  retirement  system  in  which  a  member  or
27    beneficiary is required to apply to the system for payment of
28    a benefit,  the  required  application  may  be  made  by  an
29    alternate  payee who is entitled to all of that benefit under
30    a  QILDRO,  provided  that  all  other   qualifications   and
31    requirements have been met.  However, the alternate payee may
32    not  make the required application for a member's refund or a
33    retirement benefit if the member  is  in  active  service  or
34    below   the   minimum   age  for  receiving  an  undiscounted
 
                            -8-      LRB093 03841 LRD 12693 a
 1    retirement annuity in the retirement system that has received
 2    the QILDRO or in any other retirement  system  in  which  the
 3    member  has  creditable  service  and  in  which the member's
 4    rights under the Retirement Systems Reciprocal Act  would  be
 5    affected as a result of the alternate payee's application for
 6    a member's refund or retirement benefit.
 7        (j) (1)  So  long as there is in effect a QILDRO relating
 8    to a member's retirement benefit, the affected member may not
 9    elect a form of payment that has the  effect  of  diminishing
10    the  amount  of  the  payment to which any alternate payee is
11    entitled, unless the alternate payee  has  consented  to  the
12    election  in writing and this consent has been filed with the
13    retirement system.
14        (2)  If a member attempts to make an election  prohibited
15    under  subdivision (j)(1), the retirement system shall reject
16    the election and advise the member of the need to obtain  the
17    alternate payee's consent.
18        (3)  If   a  retirement  system  discovers  that  it  has
19    mistakenly allowed an election prohibited  under  subdivision
20    (j)(1),   it  shall  thereupon  disallow  that  election  and
21    recalculate any benefits affected  thereby.   If  the  system
22    determines that an amount paid to a regular payee should have
23    been  paid  to  an  alternate  payee,  the  system  shall, if
24    possible, recoup the amounts as provided in subsection (k) of
25    this Section.
26        (k)  In the event that a regular payee  or  an  alternate
27    payee  is  overpaid,  the  retirement system shall recoup the
28    amounts by deducting the overpayment from future payments and
29    making payment to the  other  payee.   The  system  may  make
30    deductions  for  recoupment over a period of time in the same
31    manner as is provided by law or rule for  the  recoupment  of
32    other   amounts   incorrectly  disbursed  by  the  system  in
33    instances not involving  a  QILDRO.   The  retirement  system
34    shall incur no liability to either the alternate payee or the
 
                            -9-      LRB093 03841 LRD 12693 a
 1    regular  payee as a result of any payment made in good faith,
 2    regardless of  whether  the  system  is  able  to  accomplish
 3    recoupment.
 4        (l) (1)  A   retirement   system  that  has,  before  the
 5    effective date of this Section, received  and  implemented  a
 6    domestic relations order that directs payment of a benefit to
 7    a  person  other  than  the  regular  payee  may  continue to
 8    implement that order, and shall not be liable to the  regular
 9    payee for any amounts paid in good faith to that other person
10    in accordance with the order.
11        (2)  A  domestic  relations  order directing payment of a
12    benefit to a person other than the  regular  payee  that  was
13    issued  by a court but not implemented by a retirement system
14    prior to the effective date of this Section  shall  be  void.
15    However,  a  person who is the beneficiary or alternate payee
16    of a domestic relations order that  is  rendered  void  under
17    this  subsection may petition the court that issued the order
18    for an amended order that complies with this Section.
19        (m) (1)  In accordance with Article XIII,  Section  5  of
20    the  Illinois Constitution, which prohibits the impairment or
21    diminishment of benefits granted under this  Code,  a  QILDRO
22    issued  against  a  member of a retirement system established
23    under an Article of this Code that  exempts  the  payment  of
24    benefits or refunds from attachment, garnishment, judgment or
25    other  legal  process  shall  not  be  effective  without the
26    written  consent  of  the  member   if   the   member   began
27    participating  in  the  retirement  system  on  or before the
28    effective date of this Section.  That  consent  must  specify
29    the  retirement  system, the court case number, and the names
30    and social security numbers of the member and  the  alternate
31    payee.   The  consent  must  accompany  the QILDRO when it is
32    filed  with  the  retirement   system,   and   must   be   in
33    substantially the following form:

34                    CONSENT TO ISSUANCE OF QILDRO
 
                            -10-     LRB093 03841 LRD 12693 a
 1    Court Case Number: ....................
 2    Member's Social Security Number: ........................
 3    Alternate payee's Social Security Number: ...............
 4        I,  (name),  a  member of the (retirement system), hereby
 5    consent to the issuance  of  a  Qualified  Illinois  Domestic
 6    Relations  Order.  I understand that under the Order, certain
 7    benefits that would otherwise be payable  to  me,  or  to  my
 8    surviving  spouse or estate, will instead be payable to (name
 9    of alternate payee).  I also  understand  that  my  right  to
10    elect  certain  forms  of payment of my retirement benefit or
11    member's refund may be limited as a result of the Order.
12        DATED:.......................
13        SIGNED:......................

14        (2)  A member's consent to the issuance of a QILDRO shall
15    be irrevocable, and shall apply to any QILDRO  that  pertains
16    to  the  alternate  payee  and retirement system named in the
17    consent.
18        (n)  An order issued  under  this  Section  shall  be  in
19    substantially  the  following  form  (omitting any provisions
20    that are not applicable):

21             QUALIFIED ILLINOIS DOMESTIC RELATIONS ORDER

22        THIS CAUSE coming before the Court for the purpose of the
23    entry of a Qualified Illinois Domestic Relations Order  under
24    the provisions of Section 1-119 of the Illinois Pension Code,
25    the  Court  having  jurisdiction  over  the  parties  and the
26    subject matter hereof;  the Court finding  that  one  of  the
27    parties to this proceeding is a member of a retirement system
28    subject  to  Section 1-119 of the Illinois Pension Code, this
29    Order is entered to implement  a  division  of  that  party's
30    interest  in the retirement system; and the Court being fully
31    advised;
32        IT IS HEREBY ORDERED AS FOLLOWS:
33        (1)  The definitions  and  other  provisions  of  Section
 
                            -11-     LRB093 03841 LRD 12693 a
 1    1-119  of  the Illinois Pension Code are adopted by reference
 2    and made a part of this Order.
 3        (2)  Identification of Retirement System and parties:
 4             Retirement System: (name and address)
 5             Member: (name, residence address and social security
 6        number)
 7             Alternate payee: (name, residence address and social
 8        security number)
 9        (3)  The  Retirement  System  shall  pay  the   indicated
10    amounts  of the following specified benefits to the alternate
11    payee under the following terms and conditions:
12             (i)  Of  the  member's   retirement   benefit,   the
13        Retirement  System  shall  pay  to  the  alternate  payee
14        $......  per  month, beginning (if the benefit is already
15        being paid, either immediately or on  a  specified  later
16        date;  otherwise,  on  the  date  the  retirement benefit
17        commences),  and  ending  upon  the  termination  of  the
18        retirement benefit or the death of the  alternate  payee,
19        whichever occurs first.
20             (ii)  Of  any  member's refund that becomes payable,
21        the Retirement System shall pay to  the  alternate  payee
22        $...... when the member's refund becomes payable.
23        (4)  In  accordance  with subsection (j) of Section 1-119
24    of the Illinois Pension Code, so long as this  QILDRO  is  in
25    effect,  the  member  may  not elect a form of payment of the
26    retirement benefit that has the  effect  of  diminishing  the
27    amount  of  the  payment  to  which  the  alternate  payee is
28    entitled, unless the alternate payee  has  consented  to  the
29    election  in writing and this consent has been filed with the
30    retirement system.
31        (5)  If the member began participating in the  Retirement
32    System  before the effective date of this Section, this Order
33    shall not take  effect  unless  accompanied  by  the  written
34    consent  of  the  member  as required under subsection (m) of
 
                            -12-     LRB093 03841 LRD 12693 a
 1    Section 1-119 of the Illinois Pension Code.
 2        (6)  The Court retains jurisdiction to modify this Order.

 3        DATED:.......................

 4        SIGNED:......................

 5        (o) (1)  A court in Illinois that  has  issued  a  QILDRO
 6    shall  retain  jurisdiction  of  all  issues  relating to the
 7    modification of the QILDRO.  The  Administrative  Review  Law
 8    and the rules adopted pursuant thereto shall govern and apply
 9    to   all   proceedings   for   judicial   review   of   final
10    administrative  decisions  of  the  board  of trustees of the
11    retirement system arising under this Section.
12        (2)  The term "administrative decision" is defined as  in
13    Section  3-101 of the Code of Civil Procedure.  The venue for
14    review under the Administrative Review Law shall be the  same
15    as   is   provided  by  law  for  judicial  review  of  other
16    administrative decisions of the retirement system.
17        (p) (1)  Each retirement system may adopt any  procedures
18    or   rules   that  it  deems  necessary  or  useful  for  the
19    implementation of this Section.
20        (2)  Each retirement system may by rule modify the  model
21    QILDRO  form  provided  in  subsection  (n)  or  require that
22    additional information be included in  QILDROs  presented  to
23    the  system,  as  may  be  necessary to meet the needs of the
24    retirement system.
25    (Source: P.A. 90-731, eff. 7-1-99.)".