HB1154ham008 98TH GENERAL ASSEMBLY

Rep. Michael J. Madigan

Filed: 3/6/2013

 

 


 

 


 
09800HB1154ham008LRB098 08482 EFG 42221 a

1
AMENDMENT TO HOUSE BILL 1154

2    AMENDMENT NO. ______. Amend House Bill 1154, AS AMENDED, by
3inserting after the end of Section 1 the following:
 
4    "Section 7. The Illinois Pension Code is amended by
5changing Sections 2-126, 14-133, 15-136, 15-157, 16-133, and
616-152 and by adding Sections 2-105.1, 14-103.40, 15-107.1, and
716-106.4 as follows:
 
8    (40 ILCS 5/2-105.1 new)
9    Sec. 2-105.1. Tier I participant."Tier I participant": A
10participant who first became a participant before January 1,
112011.
 
12    (40 ILCS 5/2-126)  (from Ch. 108 1/2, par. 2-126)
13    Sec. 2-126. Contributions by participants.
14    (a) Each participant shall contribute toward the cost of
15his or her retirement annuity a percentage of each payment of

 

 

09800HB1154ham008- 2 -LRB098 08482 EFG 42221 a

1salary received by him or her for service as a member as
2follows: for service between October 31, 1947 and January 1,
31959, 5%; for service between January 1, 1959 and June 30,
41969, 6%; for service between July 1, 1969 and January 10,
51973, 6 1/2%; for service after January 10, 1973, 7%; for
6service after December 31, 1981, 8 1/2%.
7    (a-5) In addition to the contributions otherwise required
8under this Article, each Tier I participant shall also make the
9following contributions toward the cost of his or her
10retirement annuity from each payment of salary received by him
11or her for service as a member:
12        (1) beginning July 1, 2013 and through June 30, 2014,
13    2% of salary; and
14        (2) beginning July 1, 2014, 4.0% of salary.
15    (b) Beginning August 2, 1949, each male participant, and
16from July 1, 1971, each female participant shall contribute
17towards the cost of the survivor's annuity 2% of salary.
18    A participant who has no eligible survivor's annuity
19beneficiary may elect to cease making contributions for
20survivor's annuity under this subsection. A survivor's annuity
21shall not be payable upon the death of a person who has made
22this election, unless prior to that death the election has been
23revoked and the amount of the contributions that would have
24been paid under this subsection in the absence of the election
25is paid to the System, together with interest at the rate of 4%
26per year from the date the contributions would have been made

 

 

09800HB1154ham008- 3 -LRB098 08482 EFG 42221 a

1to the date of payment.
2    (c) Beginning July 1, 1967, each participant shall
3contribute 1% of salary towards the cost of automatic increase
4in annuity provided in Section 2-119.1. These contributions
5shall be made concurrently with contributions for retirement
6annuity purposes.
7    (d) In addition, each participant serving as an officer of
8the General Assembly shall contribute, for the same purposes
9and at the same rates as are required of a regular participant,
10on each additional payment received as an officer. If the
11participant serves as an officer for at least 2 but less than 4
12years, he or she shall contribute an amount equal to the amount
13that would have been contributed had the participant served as
14an officer for 4 years. Persons who serve as officers in the
1587th General Assembly but cannot receive the additional payment
16to officers because of the ban on increases in salary during
17their terms may nonetheless make contributions based on those
18additional payments for the purpose of having the additional
19payments included in their highest salary for annuity purposes;
20however, persons electing to make these additional
21contributions must also pay an amount representing the
22corresponding employer contributions, as calculated by the
23System.
24    (e) Notwithstanding any other provision of this Article,
25the required contribution of a participant who first becomes a
26participant on or after January 1, 2011 shall not exceed the

 

 

09800HB1154ham008- 4 -LRB098 08482 EFG 42221 a

1contribution that would be due under this Article if that
2participant's highest salary for annuity purposes were
3$106,800, plus any increases in that amount under Section
42-108.1.
5(Source: P.A. 96-1490, eff. 1-1-11.)
 
6    (40 ILCS 5/14-103.40 new)
7    Sec. 14-103.40. Tier I member. "Tier I member": A member of
8this System who first became a member or participant before
9January 1, 2011 under any reciprocal retirement system or
10pension fund established under this Code other than a
11retirement system or pension fund established under Article 2,
123, 4, 5, 6, or 18 of this Code.
 
13    (40 ILCS 5/14-133)  (from Ch. 108 1/2, par. 14-133)
14    Sec. 14-133. Contributions on behalf of members.
15    (a) Each participating employee shall make contributions
16to the System, based on the employee's compensation, as
17follows:
18        (1) Covered employees, except as indicated below, 3.5%
19    for retirement annuity, and 0.5% for a widow or survivors
20    annuity;
21        (2) Noncovered employees, except as indicated below,
22    7% for retirement annuity and 1% for a widow or survivors
23    annuity;
24        (3) Noncovered employees serving in a position in which

 

 

09800HB1154ham008- 5 -LRB098 08482 EFG 42221 a

1    "eligible creditable service" as defined in Section 14-110
2    may be earned, 1% for a widow or survivors annuity plus the
3    following amount for retirement annuity: 8.5% through
4    December 31, 2001; 9.5% in 2002; 10.5% in 2003; and 11.5%
5    in 2004 and thereafter;
6        (4) Covered employees serving in a position in which
7    "eligible creditable service" as defined in Section 14-110
8    may be earned, 0.5% for a widow or survivors annuity plus
9    the following amount for retirement annuity: 5% through
10    December 31, 2001; 6% in 2002; 7% in 2003; and 8% in 2004
11    and thereafter;
12        (5) Each security employee of the Department of
13    Corrections or of the Department of Human Services who is a
14    covered employee, 0.5% for a widow or survivors annuity
15    plus the following amount for retirement annuity: 5%
16    through December 31, 2001; 6% in 2002; 7% in 2003; and 8%
17    in 2004 and thereafter;
18        (6) Each security employee of the Department of
19    Corrections or of the Department of Human Services who is
20    not a covered employee, 1% for a widow or survivors annuity
21    plus the following amount for retirement annuity: 8.5%
22    through December 31, 2001; 9.5% in 2002; 10.5% in 2003; and
23    11.5% in 2004 and thereafter.
24    (a-5) In addition to the contributions otherwise required
25under this Article, each Tier I member shall also make the
26following contributions toward the cost of his or her

 

 

09800HB1154ham008- 6 -LRB098 08482 EFG 42221 a

1retirement annuity from each payment of compensation received
2by him or her for service as a member:
3        (1) beginning July 1, 2013 and through June 30, 2014,
4    2% of compensation; and
5        (2) beginning July 1, 2014, 4.0% of compensation.
6    (b) Contributions shall be in the form of a deduction from
7compensation and shall be made notwithstanding that the
8compensation paid in cash to the employee shall be reduced
9thereby below the minimum prescribed by law or regulation. Each
10member is deemed to consent and agree to the deductions from
11compensation provided for in this Article, and shall receipt in
12full for salary or compensation.
13(Source: P.A. 92-14, eff. 6-28-01.)
 
14    (40 ILCS 5/15-107.1 new)
15    Sec. 15-107.1. Tier I participant. "Tier I participant": A
16participant under this Article, other than a participant in the
17self-managed plan under Section 15-158.2, who first became a
18member or participant before January 1, 2011 under any
19reciprocal retirement system or pension fund established under
20this Code other than a retirement system or pension fund
21established under Article 2, 3, 4, 5, 6, or 18 of this Code.
 
22    (40 ILCS 5/15-136)  (from Ch. 108 1/2, par. 15-136)
23    Sec. 15-136. Retirement annuities - Amount. The provisions
24of this Section 15-136 apply only to those participants who are

 

 

09800HB1154ham008- 7 -LRB098 08482 EFG 42221 a

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

 

 

09800HB1154ham008- 8 -LRB098 08482 EFG 42221 a

1    15-113.6 and Section 15-113.7 plus 1.4 times all other
2    accumulated normal contributions made by the participant;
3    and
4        (iii) the annuity that can be provided on an
5    actuarially equivalent basis from the entire contribution
6    made by the participant under Section 15-113.3.
7    For the purpose of calculating an annuity under this Rule
82, the contribution required under subsection (c-5) of Section
915-157 shall not be considered when determining the
10participant's accumulated normal contributions under clause
11(i) or the employer contribution under clause (ii).
12    With respect to a police officer or firefighter who retires
13on or after August 14, 1998, the accumulated normal
14contributions taken into account under clauses (i) and (ii) of
15this Rule 2 shall include the additional normal contributions
16made by the police officer or firefighter under Section
1715-157(a).
18    The amount of a retirement annuity calculated under this
19Rule 2 shall be computed solely on the basis of the
20participant's accumulated normal contributions, as specified
21in this Rule and defined in Section 15-116. Neither an employee
22or employer contribution for early retirement under Section
2315-136.2 nor any other employer contribution shall be used in
24the calculation of the amount of a retirement annuity under
25this Rule 2.
26    This amendatory Act of the 91st General Assembly is a

 

 

09800HB1154ham008- 9 -LRB098 08482 EFG 42221 a

1clarification of existing law and applies to every participant
2and annuitant without regard to whether status as an employee
3terminates before the effective date of this amendatory Act.
4    This Rule 2 does not apply to a person who first becomes an
5employee under this Article on or after July 1, 2005.
6    Rule 3: The retirement annuity of a participant who is
7employed at least one-half time during the period on which his
8or her final rate of earnings is based, shall be equal to the
9participant's years of service not to exceed 30, multiplied by
10(1) $96 if the participant's final rate of earnings is less
11than $3,500, (2) $108 if the final rate of earnings is at least
12$3,500 but less than $4,500, (3) $120 if the final rate of
13earnings is at least $4,500 but less than $5,500, (4) $132 if
14the final rate of earnings is at least $5,500 but less than
15$6,500, (5) $144 if the final rate of earnings is at least
16$6,500 but less than $7,500, (6) $156 if the final rate of
17earnings is at least $7,500 but less than $8,500, (7) $168 if
18the final rate of earnings is at least $8,500 but less than
19$9,500, and (8) $180 if the final rate of earnings is $9,500 or
20more, except that the annuity for those persons having made an
21election under Section 15-154(a-1) shall be calculated and
22payable under the portable retirement benefit program pursuant
23to the provisions of Section 15-136.4.
24    Rule 4: A participant who is at least age 50 and has 25 or
25more years of service as a police officer or firefighter, and a
26participant who is age 55 or over and has at least 20 but less

 

 

09800HB1154ham008- 10 -LRB098 08482 EFG 42221 a

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

 

 

09800HB1154ham008- 11 -LRB098 08482 EFG 42221 a

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

 

 

09800HB1154ham008- 12 -LRB098 08482 EFG 42221 a

1contributions made under Section 15-136.2 by the System's
2annuity factor for the age of the participant at the beginning
3of the annuity payment period and (2) the amount equal to the
4participant's annuity if calculated under Rule 1, reduced under
5Section 15-136(b) as if no contributions had been made under
6Section 15-136.2.
7    With respect to a participant who is qualified for a
8retirement annuity under this Rule 5 whose retirement annuity
9began before the effective date of this amendatory Act of the
1091st General Assembly, and for whom an employee contribution
11was made under Section 15-136.2, the System shall recalculate
12the retirement annuity under this Rule 5 and shall pay any
13additional amounts due in the manner provided in Section
1415-186.1 for benefits mistakenly set too low.
15    The amount of a retirement annuity calculated under this
16Rule 5 shall be computed solely on the basis of those
17contributions specifically set forth in this Rule 5. Except as
18provided in clause (iii) of this Rule 5, neither an employee
19nor employer contribution for early retirement under Section
2015-136.2, nor any other employer contribution, shall be used in
21the calculation of the amount of a retirement annuity under
22this Rule 5.
23    The General Assembly has adopted the changes set forth in
24Section 25 of this amendatory Act of the 91st General Assembly
25in recognition that the decision of the Appellate Court for the
26Fourth District in Mattis v. State Universities Retirement

 

 

09800HB1154ham008- 13 -LRB098 08482 EFG 42221 a

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

 

 

09800HB1154ham008- 14 -LRB098 08482 EFG 42221 a

1    date the retirement annuity is to begin.
2    (c) The maximum retirement annuity provided under Rules 1,
32, 4, and 5 shall be the lesser of (1) the annual limit of
4benefits as specified in Section 415 of the Internal Revenue
5Code of 1986, as such Section may be amended from time to time
6and as such benefit limits shall be adjusted by the
7Commissioner of Internal Revenue, and (2) 80% of final rate of
8earnings.
9    (d) An annuitant whose status as an employee terminates
10after August 14, 1969 shall receive automatic increases in his
11or her retirement annuity as follows:
12    Effective January 1 immediately following the date the
13retirement annuity begins, the annuitant shall receive an
14increase in his or her monthly retirement annuity of 0.125% of
15the monthly retirement annuity provided under Rule 1, Rule 2,
16Rule 3, Rule 4, or Rule 5, contained in this Section,
17multiplied by the number of full months which elapsed from the
18date the retirement annuity payments began to January 1, 1972,
19plus 0.1667% of such annuity, multiplied by the number of full
20months which elapsed from January 1, 1972, or the date the
21retirement annuity payments began, whichever is later, to
22January 1, 1978, plus 0.25% of such annuity multiplied by the
23number of full months which elapsed from January 1, 1978, or
24the date the retirement annuity payments began, whichever is
25later, to the effective date of the increase.
26    The annuitant shall receive an increase in his or her

 

 

09800HB1154ham008- 15 -LRB098 08482 EFG 42221 a

1monthly retirement annuity on each January 1 thereafter during
2the annuitant's life of 3% of the monthly annuity provided
3under Rule 1, Rule 2, Rule 3, Rule 4, or Rule 5 contained in
4this Section. The change made under this subsection by P.A.
581-970 is effective January 1, 1980 and applies to each
6annuitant whose status as an employee terminates before or
7after that date.
8    Beginning January 1, 1990, all automatic annual increases
9payable under this Section shall be calculated as a percentage
10of the total annuity payable at the time of the increase,
11including all increases previously granted under this Article.
12    The change made in this subsection by P.A. 85-1008 is
13effective January 26, 1988, and is applicable without regard to
14whether status as an employee terminated before that date.
15    (e) If, on January 1, 1987, or the date the retirement
16annuity payment period begins, whichever is later, the sum of
17the retirement annuity provided under Rule 1 or Rule 2 of this
18Section and the automatic annual increases provided under the
19preceding subsection or Section 15-136.1, amounts to less than
20the retirement annuity which would be provided by Rule 3, the
21retirement annuity shall be increased as of January 1, 1987, or
22the date the retirement annuity payment period begins,
23whichever is later, to the amount which would be provided by
24Rule 3 of this Section. Such increased amount shall be
25considered as the retirement annuity in determining benefits
26provided under other Sections of this Article. This paragraph

 

 

09800HB1154ham008- 16 -LRB098 08482 EFG 42221 a

1applies without regard to whether status as an employee
2terminated before the effective date of this amendatory Act of
31987, provided that the annuitant was employed at least
4one-half time during the period on which the final rate of
5earnings was based.
6    (f) A participant is entitled to such additional annuity as
7may be provided on an actuarially equivalent basis, by any
8accumulated additional contributions to his or her credit.
9However, the additional contributions made by the participant
10toward the automatic increases in annuity provided under this
11Section and the contributions made under subsection (c-5) of
12Section 15-157 by this amendatory Act of the 98th General
13Assembly shall not be taken into account in determining the
14amount of such additional annuity.
15    (g) If, (1) by law, a function of a governmental unit, as
16defined by Section 20-107 of this Code, is transferred in whole
17or in part to an employer, and (2) a participant transfers
18employment from such governmental unit to such employer within
196 months after the transfer of the function, and (3) the sum of
20(A) the annuity payable to the participant under Rule 1, 2, or
213 of this Section (B) all proportional annuities payable to the
22participant by all other retirement systems covered by Article
2320, and (C) the initial primary insurance amount to which the
24participant is entitled under the Social Security Act, is less
25than the retirement annuity which would have been payable if
26all of the participant's pension credits validated under

 

 

09800HB1154ham008- 17 -LRB098 08482 EFG 42221 a

1Section 20-109 had been validated under this system, a
2supplemental annuity equal to the difference in such amounts
3shall be payable to the participant.
4    (h) On January 1, 1981, an annuitant who was receiving a
5retirement annuity on or before January 1, 1971 shall have his
6or her retirement annuity then being paid increased $1 per
7month for each year of creditable service. On January 1, 1982,
8an annuitant whose retirement annuity began on or before
9January 1, 1977, shall have his or her retirement annuity then
10being paid increased $1 per month for each year of creditable
11service.
12    (i) On January 1, 1987, any annuitant whose retirement
13annuity began on or before January 1, 1977, shall have the
14monthly retirement annuity increased by an amount equal to 8
15per year of creditable service times the number of years that
16have elapsed since the annuity began.
17(Source: P.A. 97-933, eff. 8-10-12; 97-968, eff. 8-16-12.)
 
18    (40 ILCS 5/15-157)  (from Ch. 108 1/2, par. 15-157)
19    Sec. 15-157. Employee Contributions.
20    (a) Each participating employee shall make contributions
21towards the retirement benefits payable under the retirement
22program applicable to the employee from each payment of
23earnings applicable to employment under this system on and
24after the date of becoming a participant as follows: Prior to
25September 1, 1949, 3 1/2% of earnings; from September 1, 1949

 

 

09800HB1154ham008- 18 -LRB098 08482 EFG 42221 a

1to August 31, 1955, 5%; from September 1, 1955 to August 31,
21969, 6%; from September 1, 1969, 6 1/2%. These contributions
3are to be considered as normal contributions for purposes of
4this Article.
5    Each participant who is a police officer or firefighter
6shall make normal contributions of 8% of each payment of
7earnings applicable to employment as a police officer or
8firefighter under this system on or after September 1, 1981,
9unless he or she files with the board within 60 days after the
10effective date of this amendatory Act of 1991 or 60 days after
11the board receives notice that he or she is employed as a
12police officer or firefighter, whichever is later, a written
13notice waiving the retirement formula provided by Rule 4 of
14Section 15-136. This waiver shall be irrevocable. If a
15participant had met the conditions set forth in Section
1615-132.1 prior to the effective date of this amendatory Act of
171991 but failed to make the additional normal contributions
18required by this paragraph, he or she may elect to pay the
19additional contributions plus compound interest at the
20effective rate. If such payment is received by the board, the
21service shall be considered as police officer service in
22calculating the retirement annuity under Rule 4 of Section
2315-136. While performing service described in clause (i) or
24(ii) of Rule 4 of Section 15-136, a participating employee
25shall be deemed to be employed as a firefighter for the purpose
26of determining the rate of employee contributions under this

 

 

09800HB1154ham008- 19 -LRB098 08482 EFG 42221 a

1Section.
2    (b) Starting September 1, 1969, each participating
3employee shall make additional contributions of 1/2 of 1% of
4earnings to finance a portion of the cost of the annual
5increases in retirement annuity provided under Section 15-136,
6except that with respect to participants in the self-managed
7plan this additional contribution shall be used to finance the
8benefits obtained under that retirement program.
9    (c) In addition to the amounts described in subsections (a)
10and (b) of this Section, each participating employee shall make
11contributions of 1% of earnings applicable under this system on
12and after August 1, 1959. The contributions made under this
13subsection (c) shall be considered as survivor's insurance
14contributions for purposes of this Article if the employee is
15covered under the traditional benefit package, and such
16contributions shall be considered as additional contributions
17for purposes of this Article if the employee is participating
18in the self-managed plan or has elected to participate in the
19portable benefit package and has completed the applicable
20one-year waiting period. Contributions in excess of $80 during
21any fiscal year beginning before August 31, 1969 and in excess
22of $120 during any fiscal year thereafter until September 1,
231971 shall be considered as additional contributions for
24purposes of this Article.
25    (c-5) In addition to the contributions otherwise required
26under this Article, each Tier I participant other than a

 

 

09800HB1154ham008- 20 -LRB098 08482 EFG 42221 a

1participant in the self-managed plan shall also make the
2following contributions toward the retirement benefits payable
3under the retirement program applicable to the participant from
4each payment of earnings applicable to employment under this
5system:
6        (1) beginning July 1, 2013 and through June 30, 2014,
7    2% of earnings; and
8        (2) beginning July 1, 2014, 4.0% of earnings.
9    (d) If the board by board rule so permits and subject to
10such conditions and limitations as may be specified in its
11rules, a participant may make other additional contributions of
12such percentage of earnings or amounts as the participant shall
13elect in a written notice thereof received by the board.
14    (e) That fraction of a participant's total accumulated
15normal contributions, the numerator of which is equal to the
16number of years of service in excess of that which is required
17to qualify for the maximum retirement annuity, and the
18denominator of which is equal to the total service of the
19participant, shall be considered as accumulated additional
20contributions. The determination of the applicable maximum
21annuity and the adjustment in contributions required by this
22provision shall be made as of the date of the participant's
23retirement.
24    (f) Notwithstanding the foregoing, a participating
25employee shall not be required to make contributions under this
26Section after the date upon which continuance of such

 

 

09800HB1154ham008- 21 -LRB098 08482 EFG 42221 a

1contributions would otherwise cause his or her retirement
2annuity to exceed the maximum retirement annuity as specified
3in clause (1) of subsection (c) of Section 15-136.
4    (g) A participating employee may make contributions for the
5purchase of service credit under this Article.
6(Source: P.A. 90-32, eff. 6-27-97; 90-65, eff. 7-7-97; 90-448,
7eff. 8-16-97; 90-511, eff. 8-22-97; 90-576, eff. 3-31-98;
890-655, eff. 7-30-98; 90-766, eff. 8-14-98.)
 
9    (40 ILCS 5/16-106.4 new)
10    Sec. 16-106.4. Tier I member. "Tier I member": A member
11under this Article who first became a member or participant
12before January 1, 2011 under any reciprocal retirement system
13or pension fund established under this Code other than a
14retirement system or pension fund established under Article 2,
153, 4, 5, 6, or 18 of this Code.
 
16    (40 ILCS 5/16-133)  (from Ch. 108 1/2, par. 16-133)
17    Sec. 16-133. Retirement annuity; amount.
18    (a) The amount of the retirement annuity shall be (i) in
19the case of a person who first became a teacher under this
20Article before July 1, 2005, the larger of the amounts
21determined under paragraphs (A) and (B) below, or (ii) in the
22case of a person who first becomes a teacher under this Article
23on or after July 1, 2005, the amount determined under the
24applicable provisions of paragraph (B):

 

 

09800HB1154ham008- 22 -LRB098 08482 EFG 42221 a

1        (A) An amount consisting of the sum of the following:
2            (1) An amount that can be provided on an
3        actuarially equivalent basis by the member's
4        accumulated contributions at the time of retirement;
5        and
6            (2) The sum of (i) the amount that can be provided
7        on an actuarially equivalent basis by the member's
8        accumulated contributions representing service prior
9        to July 1, 1947, and (ii) the amount that can be
10        provided on an actuarially equivalent basis by the
11        amount obtained by multiplying 1.4 times the member's
12        accumulated contributions covering service subsequent
13        to June 30, 1947; and
14            (3) If there is prior service, 2 times the amount
15        that would have been determined under subparagraph (2)
16        of paragraph (A) above on account of contributions
17        which would have been made during the period of prior
18        service creditable to the member had the System been in
19        operation and had the member made contributions at the
20        contribution rate in effect prior to July 1, 1947.
21        For the purpose of calculating the sum provided under
22    this paragraph (A), the contribution required under
23    subsection (a-5) of Section 16-152 shall not be considered
24    when determining the amount of the member's accumulated
25    contributions under subparagraph (1) or (2).
26        This paragraph (A) does not apply to a person who first

 

 

09800HB1154ham008- 23 -LRB098 08482 EFG 42221 a

1    becomes a teacher under this Article on or after July 1,
2    2005.
3        (B) An amount consisting of the greater of the
4    following:
5            (1) For creditable service earned before July 1,
6        1998 that has not been augmented under Section
7        16-129.1: 1.67% of final average salary for each of the
8        first 10 years of creditable service, 1.90% of final
9        average salary for each year in excess of 10 but not
10        exceeding 20, 2.10% of final average salary for each
11        year in excess of 20 but not exceeding 30, and 2.30% of
12        final average salary for each year in excess of 30; and
13            For creditable service earned on or after July 1,
14        1998 by a member who has at least 24 years of
15        creditable service on July 1, 1998 and who does not
16        elect to augment service under Section 16-129.1: 2.2%
17        of final average salary for each year of creditable
18        service earned on or after July 1, 1998 but before the
19        member reaches a total of 30 years of creditable
20        service and 2.3% of final average salary for each year
21        of creditable service earned on or after July 1, 1998
22        and after the member reaches a total of 30 years of
23        creditable service; and
24            For all other creditable service: 2.2% of final
25        average salary for each year of creditable service; or
26            (2) 1.5% of final average salary for each year of

 

 

09800HB1154ham008- 24 -LRB098 08482 EFG 42221 a

1        creditable service plus the sum $7.50 for each of the
2        first 20 years of creditable service.
3    The amount of the retirement annuity determined under this
4    paragraph (B) shall be reduced by 1/2 of 1% for each month
5    that the member is less than age 60 at the time the
6    retirement annuity begins. However, this reduction shall
7    not apply (i) if the member has at least 35 years of
8    creditable service, or (ii) if the member retires on
9    account of disability under Section 16-149.2 of this
10    Article with at least 20 years of creditable service, or
11    (iii) if the member (1) has earned during the period
12    immediately preceding the last day of service at least one
13    year of contributing creditable service as an employee of a
14    department as defined in Section 14-103.04, (2) has earned
15    at least 5 years of contributing creditable service as an
16    employee of a department as defined in Section 14-103.04,
17    (3) retires on or after January 1, 2001, and (4) retires
18    having attained an age which, when added to the number of
19    years of his or her total creditable service, equals at
20    least 85. Portions of years shall be counted as decimal
21    equivalents.
22    (b) For purposes of this Section, final average salary
23shall be the average salary for the highest 4 consecutive years
24within the last 10 years of creditable service as determined
25under rules of the board. The minimum final average salary
26shall be considered to be $2,400 per year.

 

 

09800HB1154ham008- 25 -LRB098 08482 EFG 42221 a

1    In the determination of final average salary for members
2other than elected officials and their appointees when such
3appointees are allowed by statute, that part of a member's
4salary for any year beginning after June 30, 1979 which exceeds
5the member's annual full-time salary rate with the same
6employer for the preceding year by more than 20% shall be
7excluded. The exclusion shall not apply in any year in which
8the member's creditable earnings are less than 50% of the
9preceding year's mean salary for downstate teachers as
10determined by the survey of school district salaries provided
11in Section 2-3.103 of the School Code.
12    (c) In determining the amount of the retirement annuity
13under paragraph (B) of this Section, a fractional year shall be
14granted proportional credit.
15    (d) The retirement annuity determined under paragraph (B)
16of this Section shall be available only to members who render
17teaching service after July 1, 1947 for which member
18contributions are required, and to annuitants who re-enter
19under the provisions of Section 16-150.
20    (e) The maximum retirement annuity provided under
21paragraph (B) of this Section shall be 75% of final average
22salary.
23    (f) A member retiring after the effective date of this
24amendatory Act of 1998 shall receive a pension equal to 75% of
25final average salary if the member is qualified to receive a
26retirement annuity equal to at least 74.6% of final average

 

 

09800HB1154ham008- 26 -LRB098 08482 EFG 42221 a

1salary under this Article or as proportional annuities under
2Article 20 of this Code.
3(Source: P.A. 94-4, eff. 6-1-05.)
 
4    (40 ILCS 5/16-152)  (from Ch. 108 1/2, par. 16-152)
5    Sec. 16-152. Contributions by members.
6    (a) Each member shall make contributions for membership
7service to this System as follows:
8        (1) Effective July 1, 1998, contributions of 7.50% of
9    salary towards the cost of the retirement annuity. Such
10    contributions shall be deemed "normal contributions".
11        (2) Effective July 1, 1969, contributions of 1/2 of 1%
12    of salary toward the cost of the automatic annual increase
13    in retirement annuity provided under Section 16-133.1.
14        (3) Effective July 24, 1959, contributions of 1% of
15    salary towards the cost of survivor benefits. Such
16    contributions shall not be credited to the individual
17    account of the member and shall not be subject to refund
18    except as provided under Section 16-143.2.
19        (4) Effective July 1, 2005, contributions of 0.40% of
20    salary toward the cost of the early retirement without
21    discount option provided under Section 16-133.2. This
22    contribution shall cease upon termination of the early
23    retirement without discount option as provided in Section
24    16-176.
25    (a-5) In addition to the contributions otherwise required

 

 

09800HB1154ham008- 27 -LRB098 08482 EFG 42221 a

1under this Article, each Tier I member shall also make the
2following contributions toward the cost of his or her
3retirement annuity from each payment of salary received by him
4or her for service as a member:
5        (1) beginning July 1, 2013 and through June 30, 2014,
6    2% of salary; and
7        (2) beginning July 1, 2014, 4.0% of salary.
8    (b) The minimum required contribution for any year of
9full-time teaching service shall be $192.
10    (c) Contributions shall not be required of any annuitant
11receiving a retirement annuity who is given employment as
12permitted under Section 16-118 or 16-150.1.
13    (d) A person who (i) was a member before July 1, 1998, (ii)
14retires with more than 34 years of creditable service, and
15(iii) does not elect to qualify for the augmented rate under
16Section 16-129.1 shall be entitled, at the time of retirement,
17to receive a partial refund of contributions made under this
18Section for service occurring after the later of June 30, 1998
19or attainment of 34 years of creditable service, in an amount
20equal to 1.00% of the salary upon which those contributions
21were based.
22    (e) A member's contributions toward the cost of early
23retirement without discount made under item (a)(4) of this
24Section shall not be refunded if the member has elected early
25retirement without discount under Section 16-133.2 and has
26begun to receive a retirement annuity under this Article

 

 

09800HB1154ham008- 28 -LRB098 08482 EFG 42221 a

1calculated in accordance with that election. Otherwise, a
2member's contributions toward the cost of early retirement
3without discount made under item (a)(4) of this Section shall
4be refunded according to whichever one of the following
5circumstances occurs first:
6        (1) The contributions shall be refunded to the member,
7    without interest, within 120 days after the member's
8    retirement annuity commences, if the member does not elect
9    early retirement without discount under Section 16-133.2.
10        (2) The contributions shall be included, without
11    interest, in any refund claimed by the member under Section
12    16-151.
13        (3) The contributions shall be refunded to the member's
14    designated beneficiary (or if there is no beneficiary, to
15    the member's estate), without interest, if the member dies
16    without having begun to receive a retirement annuity under
17    this Article.
18        (4) The contributions shall be refunded to the member,
19    without interest, within 120 days after the early
20    retirement without discount option provided under Section
21    16-133.2 is terminated under Section 16-176.
22(Source: P.A. 93-320, eff. 7-23-03; 94-4, eff. 6-1-05.)".