State of Illinois
91st General Assembly
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91_HB0347

 
                                               LRB9100809EGfg

 1        AN ACT to amend the Illinois  Pension  Code  by  changing
 2    Sections  17-116  and  17-119 and to amend the State Mandates
 3    Act.

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

 6        Section  5.   The  Illinois  Pension  Code  is amended by
 7    changing Sections 17-116 and 17-119 as follows:

 8        (40 ILCS 5/17-116) (from Ch. 108 1/2, par. 17-116)
 9        Sec. 17-116. Service retirement pension.
10        (a)  Each  teacher  having  20  years  of  service   upon
11    attainment  of age 55, or who thereafter attains age 55 shall
12    be entitled to a service retirement  pension  upon  or  after
13    attainment of age 55; and each teacher in service on or after
14    July  1,  1971,  with  5  or  more  but less than 20 years of
15    service shall be entitled to  receive  a  service  retirement
16    pension upon or after attainment of age 62.
17        (b)  The  service  retirement  pension  for a teacher who
18    retires on or after June 25, 1971, at age 60 or  over,  shall
19    be calculated as follows:
20             (1)  For  creditable  service  earned before July 1,
21        1998 that has not been augmented under Section  17-119.1:
22        1.67%  for  each  of the first 10 years of service; 1.90%
23        for each of the next 10 years of service; 2.10% for  each
24        year of service in excess of 20 but not exceeding 30; and
25        2.30%  for  each  year  of service in excess of 30, based
26        upon average salary as herein defined.
27             (2)  For creditable service earned on or after  July
28        1,  1998  by  a  member  who  has  at  least  30 years of
29        creditable service on July 1, 1998 and who does not elect
30        to augment  service  under  Section  17-119.1:   2.3%  of
31        average salary for each year of creditable service earned
 
                            -2-                LRB9100809EGfg
 1        on or after July 1, 1998.
 2             (3)  For  all  other  creditable  service:   2.2% of
 3        average salary for each year of creditable service.
 4        (c)  When computing such service retirement pensions, the
 5    following conditions shall apply:
 6             1.  Average salary  shall  consist  of  the  average
 7        annual  rate  of  salary  for  the 4 consecutive years of
 8        validated service within the last  10  years  of  service
 9        when  such  average  annual  rate  was  highest.   In the
10        determination of average salary for retirement  allowance
11        purposes,  for  members  who  commenced  employment after
12        August 31, 1979, that part of the  salary  for  any  year
13        shall  be  excluded  which  exceeds  the annual full-time
14        salary rate for the preceding year by more than 20%.   In
15        the  case  of  a  member  who commenced employment before
16        August 31, 1979 and who receives salary during  any  year
17        after  September  1,  1983  which exceeds the annual full
18        time salary rate for the preceding year by more than 20%,
19        an Employer and other employers of eligible  contributors
20        as  defined  in  Section  17-106 shall pay to the Fund an
21        amount equal to  the  present  value  of  the  additional
22        service  retirement  pension  resulting  from such excess
23        salary.  The present  value  of  the  additional  service
24        retirement  pension shall be computed by the Board on the
25        basis of actuarial tables adopted by  the  Board.   If  a
26        member  elects  to  receive  a  pension  from  this  Fund
27        provided  by  Section  20-121, his salary under the State
28        Universities  Retirement   System   and   the   Teachers'
29        Retirement  System  of  the  State  of  Illinois shall be
30        considered in determining such average  salary.   Amounts
31        paid  after  the effective date of this amendatory Act of
32        1991 for unused vacation time earned after that effective
33        date shall not under any circumstances be included in the
34        calculation of average  salary  or  the  annual  rate  of
 
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 1        salary for the purposes of this Article.
 2             2.  Proportionate   credit   shall   be   given  for
 3        validated service of less than one year.
 4             3.  For retirement at age 60  or  over  the  pension
 5        shall be payable at the full rate.
 6             4.  For  separation  from  service below age 60 to a
 7        minimum age of 55, the pension shall be discounted at the
 8        rate of 1/2 of one per cent for each month that  the  age
 9        of  the  contributor  is  less than 60, but a teacher may
10        elect to defer the effective date of pension in order  to
11        eliminate  or  reduce this discount.  This discount shall
12        not be applicable to any participant who has at least  34
13        years  of  service  or  a  retirement pension of at least
14        74.6% of  average  salary  on  the  date  the  retirement
15        annuity begins.
16             5.  No  additional  pension  shall  be  granted  for
17        service  exceeding  45 years.  Beginning June 26, 1971 no
18        pension shall exceed the greater of $1,500 per  month  or
19        75% of average salary as herein defined.
20             6.  Service  retirement  pensions shall begin on the
21        effective  date  of  resignation,  retirement,  the   day
22        following  the  close  of  the  payroll  period for which
23        service credit was validated,  or  the  time  the  person
24        resigning  or  retiring  attains  age  55,  or  on a date
25        elected by the teacher, whichever shall be latest.
26             7.  A member who is eligible to receive a retirement
27        pension of at least 74.6%  of  average  salary  and  will
28        attain  age  55  on or before December 31 during the year
29        which commences on July 1 shall be deemed to  attain  age
30        55 on the preceding June 1.
31             8.  A  member  retiring  after the effective date of
32        this amendatory Act of 1998 shall receive a pension equal
33        to 75% of average salary if the member  is  qualified  to
34        receive  a  retirement pension equal to at least 74.6% of
 
                            -4-                LRB9100809EGfg
 1        average salary under  this  Article  or  as  proportional
 2        annuities under Article 20 of this Code.
 3        (d)  Notwithstanding   the   other   provisions  of  this
 4    Section, the minimum retirement pension payable to  a  person
 5    with  at  least 20 years of service credit under this Article
 6    who begins receiving  a  retirement  pension  (other  than  a
 7    reversionary  pension)  on  or after January 1, 2000 shall be
 8    $1,333.34 per month.
 9    (Source: P.A. 90-566, eff. 1-2-98; 90-582, eff. 5-27-98.)

10        (40 ILCS 5/17-119) (from Ch. 108 1/2, par. 17-119)
11        Sec. 17-119.  Automatic annual increase in pension.
12        (a)  Each teacher retiring on or after September 1, 1959,
13    is entitled  to  the  annual  increase  in  pension,  defined
14    herein, while he is receiving a pension from the Fund.
15             1.  The   term   "base   pension"  means  a  service
16        retirement or disability retirement pension in the amount
17        fixed and payable at the date of retirement of a teacher.
18             2.  The annual increase in pension shall be  at  the
19        rate  of  1 1/2%  of  base  pension.  This increase shall
20        first occur in January of the  year  next  following  the
21        first  anniversary  of retirement.  At such time the Fund
22        shall pay the pro rata  part  of  the  increase  for  the
23        period from the first anniversary date to the date of the
24        first  increase  in  pension.  Beginning January 1, 1972,
25        the rate of annual increase in pension shall be 2% of the
26        base pension.  Beginning January 1,  1979,  the  rate  of
27        annual  increase  in  pension  shall  be  3%  of the base
28        pension.  Beginning January 1, 1990, all automatic annual
29        increases payable under this Section shall be  calculated
30        as  a percentage of the total pension payable at the time
31        of  the  increase,  including  all  increases  previously
32        granted  under  this  Article,  notwithstanding   Section
33        17-157.
 
                            -5-                LRB9100809EGfg
 1        3.  An  increase  in pension shall be granted only if the
 2    retired teacher is age 60 or over.  If  the  teacher  attains
 3    age  60 after retirement, the increase in pension shall begin
 4    in January of the year following the 61st birthday.  At  such
 5    time  the  Fund  also  shall  pay  the  pro  rata part of the
 6    increase from the 61st birthday to the date of first increase
 7    in pension.
 8        (b)  In addition to other increases which may be provided
 9    by this Section, on January  1,  1981  any  teacher  who  was
10    receiving  a  retirement pension on or before January 1, 1971
11    shall have his retirement pension then being  paid  increased
12    $1 per month for each year of creditable service.  On January
13    1,  1982,  any  teacher  whose retirement pension began on or
14    before January 1, 1977, shall  have  his  retirement  pension
15    then  being  paid  increased  $1  per  month for each year of
16    creditable service.
17        (c)  On January 1, 1987,  any  teacher  whose  retirement
18    pension  began  on  or before January 1, 1977, shall have the
19    monthly retirement pension increased by an amount equal to 8¢
20    per year of creditable service times the number of years that
21    have elapsed since the retirement pension began.
22        (d)  On January 1, 2000, every pensioner with at least 20
23    years of service credit under this Article who is receiving a
24    retirement pension (other than  a  reversionary  pension)  of
25    less  than  $1,333.34  per  month  shall  have the retirement
26    pension increased to $1,333.34 on that date,  notwithstanding
27    Section  17-157.  The increase under this subsection shall be
28    included in the calculation of the increases granted on  that
29    date or thereafter under subsection (a) of this Section.
30    (Source: P.A. 90-566, eff. 1-2-98.)

31        Section  90.  The State Mandates Act is amended by adding
32    Section 8.23 as follows:
 
                            -6-                LRB9100809EGfg
 1        (30 ILCS 805/8.23 new)
 2        Sec. 8.23. Exempt mandate.   Notwithstanding  Sections  6
 3    and  8 of this Act, no reimbursement by the State is required
 4    for  the  implementation  of  any  mandate  created  by  this
 5    amendatory Act of the 91st General Assembly.

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

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