HB1166ham007 98TH GENERAL ASSEMBLY

Rep. Elaine Nekritz

Filed: 3/13/2013

 

 


 

 


 
09800HB1166ham007LRB098 08855 EFG 42762 a

1
AMENDMENT TO HOUSE BILL 1166

2    AMENDMENT NO. ______. Amend House Bill 1166, AS AMENDED, by
3inserting after the end of Section 1 the following:
 
4    "Section 5. 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

 

 

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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) Beginning July 1, 2013, in addition to the
8contributions otherwise required under this Article, each Tier
9I participant shall contribute 3% of salary toward the cost of
10his or her retirement annuity.
11    (b) Beginning August 2, 1949, each male participant, and
12from July 1, 1971, each female participant shall contribute
13towards the cost of the survivor's annuity 2% of salary.
14    A participant who has no eligible survivor's annuity
15beneficiary may elect to cease making contributions for
16survivor's annuity under this subsection. A survivor's annuity
17shall not be payable upon the death of a person who has made
18this election, unless prior to that death the election has been
19revoked and the amount of the contributions that would have
20been paid under this subsection in the absence of the election
21is paid to the System, together with interest at the rate of 4%
22per year from the date the contributions would have been made
23to the date of payment.
24    (c) Beginning July 1, 1967, each participant shall
25contribute 1% of salary towards the cost of automatic increase
26in annuity provided in Section 2-119.1. These contributions

 

 

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1shall be made concurrently with contributions for retirement
2annuity purposes.
3    (d) In addition, each participant serving as an officer of
4the General Assembly shall contribute, for the same purposes
5and at the same rates as are required of a regular participant,
6on each additional payment received as an officer. If the
7participant serves as an officer for at least 2 but less than 4
8years, he or she shall contribute an amount equal to the amount
9that would have been contributed had the participant served as
10an officer for 4 years. Persons who serve as officers in the
1187th General Assembly but cannot receive the additional payment
12to officers because of the ban on increases in salary during
13their terms may nonetheless make contributions based on those
14additional payments for the purpose of having the additional
15payments included in their highest salary for annuity purposes;
16however, persons electing to make these additional
17contributions must also pay an amount representing the
18corresponding employer contributions, as calculated by the
19System.
20    (e) Notwithstanding any other provision of this Article,
21the required contribution of a participant who first becomes a
22participant on or after January 1, 2011 shall not exceed the
23contribution that would be due under this Article if that
24participant's highest salary for annuity purposes were
25$106,800, plus any increases in that amount under Section
262-108.1.

 

 

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1(Source: P.A. 96-1490, eff. 1-1-11.)
 
2    (40 ILCS 5/14-103.40 new)
3    Sec. 14-103.40. Tier I member. "Tier I member": A member of
4this System who first became a member or participant before
5January 1, 2011 under any reciprocal retirement system or
6pension fund established under this Code other than a
7retirement system or pension fund established under Article 2,
83, 4, 5, 6, or 18 of this Code.
 
9    (40 ILCS 5/14-133)  (from Ch. 108 1/2, par. 14-133)
10    Sec. 14-133. Contributions on behalf of members.
11    (a) Each participating employee shall make contributions
12to the System, based on the employee's compensation, as
13follows:
14        (1) Covered employees, except as indicated below, 3.5%
15    for retirement annuity, and 0.5% for a widow or survivors
16    annuity;
17        (2) Noncovered employees, except as indicated below,
18    7% for retirement annuity and 1% for a widow or survivors
19    annuity;
20        (3) Noncovered employees serving in a position in which
21    "eligible creditable service" as defined in Section 14-110
22    may be earned, 1% for a widow or survivors annuity plus the
23    following amount for retirement annuity: 8.5% through
24    December 31, 2001; 9.5% in 2002; 10.5% in 2003; and 11.5%

 

 

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1    in 2004 and thereafter;
2        (4) Covered employees serving in a position in which
3    "eligible creditable service" as defined in Section 14-110
4    may be earned, 0.5% for a widow or survivors annuity plus
5    the following amount for retirement annuity: 5% through
6    December 31, 2001; 6% in 2002; 7% in 2003; and 8% in 2004
7    and thereafter;
8        (5) Each security employee of the Department of
9    Corrections or of the Department of Human Services who is a
10    covered employee, 0.5% for a widow or survivors annuity
11    plus the following amount for retirement annuity: 5%
12    through December 31, 2001; 6% in 2002; 7% in 2003; and 8%
13    in 2004 and thereafter;
14        (6) Each security employee of the Department of
15    Corrections or of the Department of Human Services who is
16    not a covered employee, 1% for a widow or survivors annuity
17    plus the following amount for retirement annuity: 8.5%
18    through December 31, 2001; 9.5% in 2002; 10.5% in 2003; and
19    11.5% in 2004 and thereafter.
20    (a-5) Beginning July 1, 2013, in addition to the
21contributions otherwise required under this Article, each Tier
22I member shall contribute toward the cost of his or her
23retirement annuity 3% of each payment of compensation received
24by him or her for service as a member.
25    (b) Contributions shall be in the form of a deduction from
26compensation and shall be made notwithstanding that the

 

 

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1compensation paid in cash to the employee shall be reduced
2thereby below the minimum prescribed by law or regulation. Each
3member is deemed to consent and agree to the deductions from
4compensation provided for in this Article, and shall receipt in
5full for salary or compensation.
6(Source: P.A. 92-14, eff. 6-28-01.)
 
7    (40 ILCS 5/15-107.1 new)
8    Sec. 15-107.1. Tier I participant. "Tier I participant": A
9participant under this Article, other than a participant in the
10self-managed plan under Section 15-158.2, who first became a
11member or participant before January 1, 2011 under any
12reciprocal retirement system or pension fund established under
13this Code other than a retirement system or pension fund
14established under Article 2, 3, 4, 5, 6, or 18 of this Code.
 
15    (40 ILCS 5/15-136)  (from Ch. 108 1/2, par. 15-136)
16    Sec. 15-136. Retirement annuities - Amount. The provisions
17of this Section 15-136 apply only to those participants who are
18participating in the traditional benefit package or the
19portable benefit package and do not apply to participants who
20are participating in the self-managed plan.
21    (a) The amount of a participant's retirement annuity,
22expressed in the form of a single-life annuity, shall be
23determined by whichever of the following rules is applicable
24and provides the largest annuity:

 

 

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1    Rule 1: The retirement annuity shall be 1.67% of final rate
2of earnings for each of the first 10 years of service, 1.90%
3for each of the next 10 years of service, 2.10% for each year
4of service in excess of 20 but not exceeding 30, and 2.30% for
5each year in excess of 30; or for persons who retire on or
6after January 1, 1998, 2.2% of the final rate of earnings for
7each year of service.
8    Rule 2: The retirement annuity shall be the sum of the
9following, determined from amounts credited to the participant
10in accordance with the actuarial tables and the effective rate
11of interest in effect at the time the retirement annuity
12begins:
13        (i) the normal annuity which can be provided on an
14    actuarially equivalent basis, by the accumulated normal
15    contributions as of the date the annuity begins;
16        (ii) an annuity from employer contributions of an
17    amount equal to that which can be provided on an
18    actuarially equivalent basis from the accumulated normal
19    contributions made by the participant under Section
20    15-113.6 and Section 15-113.7 plus 1.4 times all other
21    accumulated normal contributions made by the participant;
22    and
23        (iii) the annuity that can be provided on an
24    actuarially equivalent basis from the entire contribution
25    made by the participant under Section 15-113.3.
26    For the purpose of calculating an annuity under this Rule

 

 

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12, the contribution required under subsection (c-5) of Section
215-157 shall not be considered when determining the
3participant's accumulated normal contributions under clause
4(i) or the employer contribution under clause (ii).
5    With respect to a police officer or firefighter who retires
6on or after August 14, 1998, the accumulated normal
7contributions taken into account under clauses (i) and (ii) of
8this Rule 2 shall include the additional normal contributions
9made by the police officer or firefighter under Section
1015-157(a).
11    The amount of a retirement annuity calculated under this
12Rule 2 shall be computed solely on the basis of the
13participant's accumulated normal contributions, as specified
14in this Rule and defined in Section 15-116. Neither an employee
15or employer contribution for early retirement under Section
1615-136.2 nor any other employer contribution shall be used in
17the calculation of the amount of a retirement annuity under
18this Rule 2.
19    This amendatory Act of the 91st General Assembly is a
20clarification of existing law and applies to every participant
21and annuitant without regard to whether status as an employee
22terminates before the effective date of this amendatory Act.
23    This Rule 2 does not apply to a person who first becomes an
24employee under this Article on or after July 1, 2005.
25    Rule 3: The retirement annuity of a participant who is
26employed at least one-half time during the period on which his

 

 

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1or her final rate of earnings is based, shall be equal to the
2participant's years of service not to exceed 30, multiplied by
3(1) $96 if the participant's final rate of earnings is less
4than $3,500, (2) $108 if the final rate of earnings is at least
5$3,500 but less than $4,500, (3) $120 if the final rate of
6earnings is at least $4,500 but less than $5,500, (4) $132 if
7the final rate of earnings is at least $5,500 but less than
8$6,500, (5) $144 if the final rate of earnings is at least
9$6,500 but less than $7,500, (6) $156 if the final rate of
10earnings is at least $7,500 but less than $8,500, (7) $168 if
11the final rate of earnings is at least $8,500 but less than
12$9,500, and (8) $180 if the final rate of earnings is $9,500 or
13more, except that the annuity for those persons having made an
14election under Section 15-154(a-1) shall be calculated and
15payable under the portable retirement benefit program pursuant
16to the provisions of Section 15-136.4.
17    Rule 4: A participant who is at least age 50 and has 25 or
18more years of service as a police officer or firefighter, and a
19participant who is age 55 or over and has at least 20 but less
20than 25 years of service as a police officer or firefighter,
21shall be entitled to a retirement annuity of 2 1/4% of the
22final rate of earnings for each of the first 10 years of
23service as a police officer or firefighter, 2 1/2% for each of
24the next 10 years of service as a police officer or
25firefighter, and 2 3/4% for each year of service as a police
26officer or firefighter in excess of 20. The retirement annuity

 

 

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

 

 

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1    actuarially equivalent basis, by the accumulated normal
2    contributions as of the date the annuity begins; and
3        (ii) an annuity from employer contributions of an
4    amount equal to that which can be provided on an
5    actuarially equivalent basis from the accumulated normal
6    contributions made by the participant under Section
7    15-113.6 and Section 15-113.7 plus 1.4 times all other
8    accumulated normal contributions made by the participant;
9    and
10        (iii) an annuity which can be provided on an
11    actuarially equivalent basis from the employee
12    contribution for early retirement under Section 15-136.2,
13    and an annuity from employer contributions of an amount
14    equal to that which can be provided on an actuarially
15    equivalent basis from the employee contribution for early
16    retirement under Section 15-136.2.
17    In no event shall a retirement annuity under this Rule 5 be
18lower than the amount obtained by adding (1) the monthly amount
19obtained by dividing the combined employee and employer
20contributions made under Section 15-136.2 by the System's
21annuity factor for the age of the participant at the beginning
22of the annuity payment period and (2) the amount equal to the
23participant's annuity if calculated under Rule 1, reduced under
24Section 15-136(b) as if no contributions had been made under
25Section 15-136.2.
26    With respect to a participant who is qualified for a

 

 

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1retirement annuity under this Rule 5 whose retirement annuity
2began before the effective date of this amendatory Act of the
391st General Assembly, and for whom an employee contribution
4was made under Section 15-136.2, the System shall recalculate
5the retirement annuity under this Rule 5 and shall pay any
6additional amounts due in the manner provided in Section
715-186.1 for benefits mistakenly set too low.
8    The amount of a retirement annuity calculated under this
9Rule 5 shall be computed solely on the basis of those
10contributions specifically set forth in this Rule 5. Except as
11provided in clause (iii) of this Rule 5, neither an employee
12nor employer contribution for early retirement under Section
1315-136.2, nor any other employer contribution, shall be used in
14the calculation of the amount of a retirement annuity under
15this Rule 5.
16    The General Assembly has adopted the changes set forth in
17Section 25 of this amendatory Act of the 91st General Assembly
18in recognition that the decision of the Appellate Court for the
19Fourth District in Mattis v. State Universities Retirement
20System et al. might be deemed to give some right to the
21plaintiff in that case. The changes made by Section 25 of this
22amendatory Act of the 91st General Assembly are a legislative
23implementation of the decision of the Appellate Court for the
24Fourth District in Mattis v. State Universities Retirement
25System et al. with respect to that plaintiff.
26    The changes made by Section 25 of this amendatory Act of

 

 

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1the 91st General Assembly apply without regard to whether the
2person is in service as an employee on or after its effective
3date.
4    (b) The retirement annuity provided under Rules 1 and 3
5above shall be reduced by 1/2 of 1% for each month the
6participant is under age 60 at the time of retirement. However,
7this reduction shall not apply in the following cases:
8        (1) For a disabled participant whose disability
9    benefits have been discontinued because he or she has
10    exhausted eligibility for disability benefits under clause
11    (6) of Section 15-152;
12        (2) For a participant who has at least the number of
13    years of service required to retire at any age under
14    subsection (a) of Section 15-135; or
15        (3) For that portion of a retirement annuity which has
16    been provided on account of service of the participant
17    during periods when he or she performed the duties of a
18    police officer or firefighter, if these duties were
19    performed for at least 5 years immediately preceding the
20    date the retirement annuity is to begin.
21    (c) The maximum retirement annuity provided under Rules 1,
222, 4, and 5 shall be the lesser of (1) the annual limit of
23benefits as specified in Section 415 of the Internal Revenue
24Code of 1986, as such Section may be amended from time to time
25and as such benefit limits shall be adjusted by the
26Commissioner of Internal Revenue, and (2) 80% of final rate of

 

 

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1earnings.
2    (d) An annuitant whose status as an employee terminates
3after August 14, 1969 shall receive automatic increases in his
4or her retirement annuity as follows:
5    Effective January 1 immediately following the date the
6retirement annuity begins, the annuitant shall receive an
7increase in his or her monthly retirement annuity of 0.125% of
8the monthly retirement annuity provided under Rule 1, Rule 2,
9Rule 3, Rule 4, or Rule 5, contained in this Section,
10multiplied by the number of full months which elapsed from the
11date the retirement annuity payments began to January 1, 1972,
12plus 0.1667% of such annuity, multiplied by the number of full
13months which elapsed from January 1, 1972, or the date the
14retirement annuity payments began, whichever is later, to
15January 1, 1978, plus 0.25% of such annuity multiplied by the
16number of full months which elapsed from January 1, 1978, or
17the date the retirement annuity payments began, whichever is
18later, to the effective date of the increase.
19    The annuitant shall receive an increase in his or her
20monthly retirement annuity on each January 1 thereafter during
21the annuitant's life of 3% of the monthly annuity provided
22under Rule 1, Rule 2, Rule 3, Rule 4, or Rule 5 contained in
23this Section. The change made under this subsection by P.A.
2481-970 is effective January 1, 1980 and applies to each
25annuitant whose status as an employee terminates before or
26after that date.

 

 

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1    Beginning January 1, 1990, all automatic annual increases
2payable under this Section shall be calculated as a percentage
3of the total annuity payable at the time of the increase,
4including all increases previously granted under this Article.
5    The change made in this subsection by P.A. 85-1008 is
6effective January 26, 1988, and is applicable without regard to
7whether status as an employee terminated before that date.
8    (e) If, on January 1, 1987, or the date the retirement
9annuity payment period begins, whichever is later, the sum of
10the retirement annuity provided under Rule 1 or Rule 2 of this
11Section and the automatic annual increases provided under the
12preceding subsection or Section 15-136.1, amounts to less than
13the retirement annuity which would be provided by Rule 3, the
14retirement annuity shall be increased as of January 1, 1987, or
15the date the retirement annuity payment period begins,
16whichever is later, to the amount which would be provided by
17Rule 3 of this Section. Such increased amount shall be
18considered as the retirement annuity in determining benefits
19provided under other Sections of this Article. This paragraph
20applies without regard to whether status as an employee
21terminated before the effective date of this amendatory Act of
221987, provided that the annuitant was employed at least
23one-half time during the period on which the final rate of
24earnings was based.
25    (f) A participant is entitled to such additional annuity as
26may be provided on an actuarially equivalent basis, by any

 

 

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1accumulated additional contributions to his or her credit.
2However, the additional contributions made by the participant
3toward the automatic increases in annuity provided under this
4Section and the contributions made under subsection (c-5) of
5Section 15-157 by this amendatory Act of the 98th General
6Assembly shall not be taken into account in determining the
7amount of such additional annuity.
8    (g) If, (1) by law, a function of a governmental unit, as
9defined by Section 20-107 of this Code, is transferred in whole
10or in part to an employer, and (2) a participant transfers
11employment from such governmental unit to such employer within
126 months after the transfer of the function, and (3) the sum of
13(A) the annuity payable to the participant under Rule 1, 2, or
143 of this Section (B) all proportional annuities payable to the
15participant by all other retirement systems covered by Article
1620, and (C) the initial primary insurance amount to which the
17participant is entitled under the Social Security Act, is less
18than the retirement annuity which would have been payable if
19all of the participant's pension credits validated under
20Section 20-109 had been validated under this system, a
21supplemental annuity equal to the difference in such amounts
22shall be payable to the participant.
23    (h) On January 1, 1981, an annuitant who was receiving a
24retirement annuity on or before January 1, 1971 shall have his
25or her retirement annuity then being paid increased $1 per
26month for each year of creditable service. On January 1, 1982,

 

 

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1an annuitant whose retirement annuity began on or before
2January 1, 1977, shall have his or her retirement annuity then
3being paid increased $1 per month for each year of creditable
4service.
5    (i) On January 1, 1987, any annuitant whose retirement
6annuity began on or before January 1, 1977, shall have the
7monthly retirement annuity increased by an amount equal to 8
8per year of creditable service times the number of years that
9have elapsed since the annuity began.
10(Source: P.A. 97-933, eff. 8-10-12; 97-968, eff. 8-16-12.)
 
11    (40 ILCS 5/15-157)  (from Ch. 108 1/2, par. 15-157)
12    Sec. 15-157. Employee Contributions.
13    (a) Each participating employee shall make contributions
14towards the retirement benefits payable under the retirement
15program applicable to the employee from each payment of
16earnings applicable to employment under this system on and
17after the date of becoming a participant as follows: Prior to
18September 1, 1949, 3 1/2% of earnings; from September 1, 1949
19to August 31, 1955, 5%; from September 1, 1955 to August 31,
201969, 6%; from September 1, 1969, 6 1/2%. These contributions
21are to be considered as normal contributions for purposes of
22this Article.
23    Each participant who is a police officer or firefighter
24shall make normal contributions of 8% of each payment of
25earnings applicable to employment as a police officer or

 

 

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1firefighter under this system on or after September 1, 1981,
2unless he or she files with the board within 60 days after the
3effective date of this amendatory Act of 1991 or 60 days after
4the board receives notice that he or she is employed as a
5police officer or firefighter, whichever is later, a written
6notice waiving the retirement formula provided by Rule 4 of
7Section 15-136. This waiver shall be irrevocable. If a
8participant had met the conditions set forth in Section
915-132.1 prior to the effective date of this amendatory Act of
101991 but failed to make the additional normal contributions
11required by this paragraph, he or she may elect to pay the
12additional contributions plus compound interest at the
13effective rate. If such payment is received by the board, the
14service shall be considered as police officer service in
15calculating the retirement annuity under Rule 4 of Section
1615-136. While performing service described in clause (i) or
17(ii) of Rule 4 of Section 15-136, a participating employee
18shall be deemed to be employed as a firefighter for the purpose
19of determining the rate of employee contributions under this
20Section.
21    (b) Starting September 1, 1969, each participating
22employee shall make additional contributions of 1/2 of 1% of
23earnings to finance a portion of the cost of the annual
24increases in retirement annuity provided under Section 15-136,
25except that with respect to participants in the self-managed
26plan this additional contribution shall be used to finance the

 

 

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1benefits obtained under that retirement program.
2    (c) In addition to the amounts described in subsections (a)
3and (b) of this Section, each participating employee shall make
4contributions of 1% of earnings applicable under this system on
5and after August 1, 1959. The contributions made under this
6subsection (c) shall be considered as survivor's insurance
7contributions for purposes of this Article if the employee is
8covered under the traditional benefit package, and such
9contributions shall be considered as additional contributions
10for purposes of this Article if the employee is participating
11in the self-managed plan or has elected to participate in the
12portable benefit package and has completed the applicable
13one-year waiting period. Contributions in excess of $80 during
14any fiscal year beginning before August 31, 1969 and in excess
15of $120 during any fiscal year thereafter until September 1,
161971 shall be considered as additional contributions for
17purposes of this Article.
18    (c-5) Beginning July 1, 2013, in addition to the
19contributions otherwise required under this Article, each Tier
20I participant other than a participant in the self-managed plan
21shall contribute 3% of each payment of earnings applicable to
22employment under this System toward the retirement benefits
23payable under the retirement program applicable to the
24participant.
25    (d) If the board by board rule so permits and subject to
26such conditions and limitations as may be specified in its

 

 

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1rules, a participant may make other additional contributions of
2such percentage of earnings or amounts as the participant shall
3elect in a written notice thereof received by the board.
4    (e) That fraction of a participant's total accumulated
5normal contributions, the numerator of which is equal to the
6number of years of service in excess of that which is required
7to qualify for the maximum retirement annuity, and the
8denominator of which is equal to the total service of the
9participant, shall be considered as accumulated additional
10contributions. The determination of the applicable maximum
11annuity and the adjustment in contributions required by this
12provision shall be made as of the date of the participant's
13retirement.
14    (f) Notwithstanding the foregoing, a participating
15employee shall not be required to make contributions under this
16Section after the date upon which continuance of such
17contributions would otherwise cause his or her retirement
18annuity to exceed the maximum retirement annuity as specified
19in clause (1) of subsection (c) of Section 15-136.
20    (g) A participating employee may make contributions for the
21purchase of service credit under this Article.
22(Source: P.A. 90-32, eff. 6-27-97; 90-65, eff. 7-7-97; 90-448,
23eff. 8-16-97; 90-511, eff. 8-22-97; 90-576, eff. 3-31-98;
2490-655, eff. 7-30-98; 90-766, eff. 8-14-98.)
 
25    (40 ILCS 5/16-106.4 new)

 

 

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1    Sec. 16-106.4. Tier I member. "Tier I member": A member
2under this Article who first became a member or participant
3before January 1, 2011 under any reciprocal retirement system
4or pension fund established under this Code other than a
5retirement system or pension fund established under Article 2,
63, 4, 5, 6, or 18 of this Code.
 
7    (40 ILCS 5/16-133)  (from Ch. 108 1/2, par. 16-133)
8    Sec. 16-133. Retirement annuity; amount.
9    (a) The amount of the retirement annuity shall be (i) in
10the case of a person who first became a teacher under this
11Article before July 1, 2005, the larger of the amounts
12determined under paragraphs (A) and (B) below, or (ii) in the
13case of a person who first becomes a teacher under this Article
14on or after July 1, 2005, the amount determined under the
15applicable provisions of paragraph (B):
16        (A) An amount consisting of the sum of the following:
17            (1) An amount that can be provided on an
18        actuarially equivalent basis by the member's
19        accumulated contributions at the time of retirement;
20        and
21            (2) The sum of (i) the amount that can be provided
22        on an actuarially equivalent basis by the member's
23        accumulated contributions representing service prior
24        to July 1, 1947, and (ii) the amount that can be
25        provided on an actuarially equivalent basis by the

 

 

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1        amount obtained by multiplying 1.4 times the member's
2        accumulated contributions covering service subsequent
3        to June 30, 1947; and
4            (3) If there is prior service, 2 times the amount
5        that would have been determined under subparagraph (2)
6        of paragraph (A) above on account of contributions
7        which would have been made during the period of prior
8        service creditable to the member had the System been in
9        operation and had the member made contributions at the
10        contribution rate in effect prior to July 1, 1947.
11        For the purpose of calculating the sum provided under
12    this paragraph (A), the contribution required under
13    subsection (a-5) of Section 16-152 shall not be considered
14    when determining the amount of the member's accumulated
15    contributions under subparagraph (1) or (2).
16        This paragraph (A) does not apply to a person who first
17    becomes a teacher under this Article on or after July 1,
18    2005.
19        (B) An amount consisting of the greater of the
20    following:
21            (1) For creditable service earned before July 1,
22        1998 that has not been augmented under Section
23        16-129.1: 1.67% of final average salary for each of the
24        first 10 years of creditable service, 1.90% of final
25        average salary for each year in excess of 10 but not
26        exceeding 20, 2.10% of final average salary for each

 

 

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1        year in excess of 20 but not exceeding 30, and 2.30% of
2        final average salary for each year in excess of 30; and
3            For creditable service earned on or after July 1,
4        1998 by a member who has at least 24 years of
5        creditable service on July 1, 1998 and who does not
6        elect to augment service under Section 16-129.1: 2.2%
7        of final average salary for each year of creditable
8        service earned on or after July 1, 1998 but before the
9        member reaches a total of 30 years of creditable
10        service and 2.3% of final average salary for each year
11        of creditable service earned on or after July 1, 1998
12        and after the member reaches a total of 30 years of
13        creditable service; and
14            For all other creditable service: 2.2% of final
15        average salary for each year of creditable service; or
16            (2) 1.5% of final average salary for each year of
17        creditable service plus the sum $7.50 for each of the
18        first 20 years of creditable service.
19    The amount of the retirement annuity determined under this
20    paragraph (B) shall be reduced by 1/2 of 1% for each month
21    that the member is less than age 60 at the time the
22    retirement annuity begins. However, this reduction shall
23    not apply (i) if the member has at least 35 years of
24    creditable service, or (ii) if the member retires on
25    account of disability under Section 16-149.2 of this
26    Article with at least 20 years of creditable service, or

 

 

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1    (iii) if the member (1) has earned during the period
2    immediately preceding the last day of service at least one
3    year of contributing creditable service as an employee of a
4    department as defined in Section 14-103.04, (2) has earned
5    at least 5 years of contributing creditable service as an
6    employee of a department as defined in Section 14-103.04,
7    (3) retires on or after January 1, 2001, and (4) retires
8    having attained an age which, when added to the number of
9    years of his or her total creditable service, equals at
10    least 85. Portions of years shall be counted as decimal
11    equivalents.
12    (b) For purposes of this Section, final average salary
13shall be the average salary for the highest 4 consecutive years
14within the last 10 years of creditable service as determined
15under rules of the board. The minimum final average salary
16shall be considered to be $2,400 per year.
17    In the determination of final average salary for members
18other than elected officials and their appointees when such
19appointees are allowed by statute, that part of a member's
20salary for any year beginning after June 30, 1979 which exceeds
21the member's annual full-time salary rate with the same
22employer for the preceding year by more than 20% shall be
23excluded. The exclusion shall not apply in any year in which
24the member's creditable earnings are less than 50% of the
25preceding year's mean salary for downstate teachers as
26determined by the survey of school district salaries provided

 

 

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1in Section 2-3.103 of the School Code.
2    (c) In determining the amount of the retirement annuity
3under paragraph (B) of this Section, a fractional year shall be
4granted proportional credit.
5    (d) The retirement annuity determined under paragraph (B)
6of this Section shall be available only to members who render
7teaching service after July 1, 1947 for which member
8contributions are required, and to annuitants who re-enter
9under the provisions of Section 16-150.
10    (e) The maximum retirement annuity provided under
11paragraph (B) of this Section shall be 75% of final average
12salary.
13    (f) A member retiring after the effective date of this
14amendatory Act of 1998 shall receive a pension equal to 75% of
15final average salary if the member is qualified to receive a
16retirement annuity equal to at least 74.6% of final average
17salary under this Article or as proportional annuities under
18Article 20 of this Code.
19(Source: P.A. 94-4, eff. 6-1-05.)
 
20    (40 ILCS 5/16-152)  (from Ch. 108 1/2, par. 16-152)
21    Sec. 16-152. Contributions by members.
22    (a) Each member shall make contributions for membership
23service to this System as follows:
24        (1) Effective July 1, 1998, contributions of 7.50% of
25    salary towards the cost of the retirement annuity. Such

 

 

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1    contributions shall be deemed "normal contributions".
2        (2) Effective July 1, 1969, contributions of 1/2 of 1%
3    of salary toward the cost of the automatic annual increase
4    in retirement annuity provided under Section 16-133.1.
5        (3) Effective July 24, 1959, contributions of 1% of
6    salary towards the cost of survivor benefits. Such
7    contributions shall not be credited to the individual
8    account of the member and shall not be subject to refund
9    except as provided under Section 16-143.2.
10        (4) Effective July 1, 2005, contributions of 0.40% of
11    salary toward the cost of the early retirement without
12    discount option provided under Section 16-133.2. This
13    contribution shall cease upon termination of the early
14    retirement without discount option as provided in Section
15    16-176.
16    (a-5) Beginning July 1, 2013, in addition to the
17contributions otherwise required under this Article, each Tier
18I member shall contribute 3% of each payment of salary received
19by him or her for service as a member toward the cost of his or
20her retirement annuity.
21    (b) The minimum required contribution for any year of
22full-time teaching service shall be $192.
23    (c) Contributions shall not be required of any annuitant
24receiving a retirement annuity who is given employment as
25permitted under Section 16-118 or 16-150.1.
26    (d) A person who (i) was a member before July 1, 1998, (ii)

 

 

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1retires with more than 34 years of creditable service, and
2(iii) does not elect to qualify for the augmented rate under
3Section 16-129.1 shall be entitled, at the time of retirement,
4to receive a partial refund of contributions made under this
5Section for service occurring after the later of June 30, 1998
6or attainment of 34 years of creditable service, in an amount
7equal to 1.00% of the salary upon which those contributions
8were based.
9    (e) A member's contributions toward the cost of early
10retirement without discount made under item (a)(4) of this
11Section shall not be refunded if the member has elected early
12retirement without discount under Section 16-133.2 and has
13begun to receive a retirement annuity under this Article
14calculated in accordance with that election. Otherwise, a
15member's contributions toward the cost of early retirement
16without discount made under item (a)(4) of this Section shall
17be refunded according to whichever one of the following
18circumstances occurs first:
19        (1) The contributions shall be refunded to the member,
20    without interest, within 120 days after the member's
21    retirement annuity commences, if the member does not elect
22    early retirement without discount under Section 16-133.2.
23        (2) The contributions shall be included, without
24    interest, in any refund claimed by the member under Section
25    16-151.
26        (3) The contributions shall be refunded to the member's

 

 

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1    designated beneficiary (or if there is no beneficiary, to
2    the member's estate), without interest, if the member dies
3    without having begun to receive a retirement annuity under
4    this Article.
5        (4) The contributions shall be refunded to the member,
6    without interest, within 120 days after the early
7    retirement without discount option provided under Section
8    16-133.2 is terminated under Section 16-176.
9(Source: P.A. 93-320, eff. 7-23-03; 94-4, eff. 6-1-05.)".