State of Illinois
91st General Assembly

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 1        AN ACT in relation to public employee benefits.

 2        Be  it  enacted  by  the People of the State of Illinois,
 3    represented in the General Assembly:

 4        Section 5.  The  Illinois  Pension  Code  is  amended  by
 5    changing Section 14-130 as follows:

 6        (40 ILCS 5/14-130) (from Ch. 108 1/2, par. 14-130)
 7        Sec. 14-130.  Refunds; rules.
 8        (a)  Upon  withdrawal  a  member  is entitled to receive,
 9    upon written request, a refund of the member's contributions,
10    including credits granted  while  in  receipt  of  disability
11    benefits,  without  credited  interest.   The  board,  in its
12    discretion may withhold payment of the refund of  a  member's
13    contributions  for  a  period  not to exceed 1 year after the
14    member has ceased to be an employee.
15        For purposes of this Section, a member will be considered
16    to have withdrawn from service if a change  in,  or  transfer
17    of,  his  position  results  in  his  becoming ineligible for
18    continued  membership  in  this  System  and   eligible   for
19    membership  in  another  public  retirement system under this
20    Act.
21        (b)  A   member   receiving   a   refund   forfeits   and
22    relinquishes all accrued rights in the System, including  all
23    accumulated  creditable service.  If the person again becomes
24    a member of the System and establishes at least  2  years  of
25    creditable   service,   the   member  may  repay  the  moneys
26    previously refunded.  However, a former  member  may  restore
27    credits  previously  forfeited  by  acceptance  of  a  refund
28    without  returning  to  service  by  applying  in writing and
29    repaying to the System, by April 1, 1993, the amount  of  the
30    refund  plus  regular  interest  calculated  from the date of
31    refund to the date of repayment.
                            -2-                LRB9114837EGfg
 1        The repayment of refunds issued prior to January 1,  1984
 2    shall  consist  of  the  amount refunded plus 5% interest per
 3    annum compounded annually for the period from the date of the
 4    refund to the end of the month in which  repayment  is  made.
 5    The  repayment  of refunds issued after January 1, 1984 shall
 6    consist of the amount refunded plus regular interest for  the
 7    period  from  the  date  of refund to the end of the month in
 8    which repayment is made.  However, in the case  of  a  refund
 9    that is repaid in a lump sum between January 1, 1991 and July
10    1,  1991, repayment shall consist of the amount refunded plus
11    interest at the rate of 2.5% per  annum  compounded  annually
12    from  the date of the refund to the end of the month in which
13    repayment is made.  In the case of a refund that is repaid in
14    a lump sum in 2001, the interest rate shall  be  one-half  of
15    the rate otherwise provided for under this paragraph.
16        Upon  repayment,  the member shall receive credit for the
17    service, member contributions and regular interest  that  was
18    forfeited  by  acceptance  of  the  refund as well as regular
19    interest for the period of  non-membership.   Such  repayment
20    shall  be made in full before retirement either in a lump sum
21    or in installment payments in accordance with such  rules  as
22    may be adopted by the board.
23        (b-5)  The  Board may adopt rules governing the repayment
24    of refunds and establishment of credits  in  cases  involving
25    awards of back pay or reinstatement.  The rules may authorize
26    repayment  of  a refund in installment payments and may waive
27    the payment of interest on  refund  amounts  repaid  in  full
28    within a specified period.
29        (c)  A  member  no longer in service who is unmarried and
30    does not have an eligible survivors  annuity  beneficiary  on
31    the  date  of application therefor is entitled to a refund of
32    contributions  for  widow's  annuity  or  survivors   annuity
33    purposes,  or  both, as the case may be, without interest.  A
34    widow's annuity or survivors annuity  shall  not  be  payable
                            -3-                LRB9114837EGfg
 1    upon  the  death  of  a  person who has received this refund,
 2    unless prior to that death the amount of the refund has  been
 3    repaid to the System, together with regular interest from the
 4    date of the refund to the date of repayment.
 5        (d)  Any  member  who  has service credit in any position
 6    for which an alternative retirement annuity is  provided  and
 7    in  relation  to  which  an  increase in the rate of employee
 8    contribution is required, shall  be  entitled  to  a  refund,
 9    without  interest,  of  that  part  of  the member's employee
10    contribution which results from that increase in the employee
11    rate if the member does  not  qualify  for  that  alternative
12    retirement annuity at the time of retirement.
13    (Source: P.A. 90-448, eff. 8-16-97; 91-887, eff. 7-6-00.)

14        Section  99.  Effective date.  This Act takes effect upon
15    becoming law.

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