State of Illinois
92nd General Assembly
Legislation

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[ Introduced ][ House Amendment 001 ]


92_HB4509eng

 
HB4509 Engrossed                               LRB9215746EGfg

 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  Sections  13-304,  13-502,  and  13-503  and adding
 6    Section 13-304.1 as follows:

 7        (40 ILCS 5/13-304) (from Ch. 108 1/2, par. 13-304)
 8        Sec. 13-304.  Optional plan of  additional  benefits  and
 9    contributions made through December 31, 2002.
10        (a)  While  this  plan is in effect, an eligible employee
11    may  establish  additional  optional  credit  for  additional
12    benefits  by  electing  in  writing  at  any  time  to   make
13    additional   optional   contributions.    The   employee  may
14    discontinue making the additional optional  contributions  at
15    any time by notifying the Fund in writing.
16        Employees  first entering service after June 30, 1997 are
17    not eligible to participate in  the  plan  established  under
18    this Section.
19        (b)  Additional optional contributions for the additional
20    optional benefits shall be as follows:
21             (1)  For  service  after  the  option is elected, an
22        additional  contribution  of  3%  of  salary   shall   be
23        contributed  to  the Fund on the same basis and under the
24        same conditions as contributions required  under  Section
25        13-502.
26             (2)  For  service  before  the option is elected, an
27        additional contribution of  3%  of  the  salary  for  the
28        applicable period of service, plus interest at the annual
29        rate  as  shall  from  time  to time be determined by the
30        Board, compounded annually from the date  of  service  to
31        the  date of payment.  All payments for past service must
 
HB4509 Engrossed            -2-                LRB9215746EGfg
 1        be paid in full before credit is given.  A person who has
 2        withdrawn   from   service   may   pay   the   additional
 3        contribution for past service at any time within 30  days
 4        after withdrawal from service, so long as payment is made
 5        in  full  before  the  retirement  annuity commences.  No
 6        additional optional contributions may  be  made  for  any
 7        period  of  service  for which credit has been previously
 8        forfeited by acceptance of a refund, unless the refund is
 9        repaid in full with interest at  the  rate  specified  in
10        Section  13-603,  from  the date of refund to the date of
11        repayment.  Nothing herein may be construed to  allow  an
12        additional  optional  contribution  to  be  made  on  the
13        account of a deceased employee.
14        (c)  Additional  optional  benefit  shall  accrue for all
15    periods   of   eligible   service   for   which    additional
16    contributions are paid in full.  The additional benefit shall
17    consist  of an additional 1% of average final salary for each
18    year of service for which optional  contributions  have  been
19    paid,  to  be  added  to the employee's retirement annuity as
20    otherwise computed under this Article.   The  calculation  of
21    these  additional benefits shall be subject to the same terms
22    and  conditions  as  are  used  in  the  calculation  of  the
23    retirement  annuity  under  this  Article.   The   additional
24    benefit shall be included in the calculation of the automatic
25    annual  increase  in  annuity under Section 13-302(d), and in
26    the  calculation  of   surviving   spouse's   annuity   where
27    applicable.   However, no additional benefits will be granted
28    which produce a total annuity  greater  than  the  applicable
29    maximum established for that type of annuity in this Article.
30    The  total  additional  optional benefit that may be received
31    under this Section is 15% of average final salary.
32        (d)  Refunds of additional optional  contributions  shall
33    be  made  on  the same basis and under the same conditions as
34    provided under Section 13-601.
 
HB4509 Engrossed            -3-                LRB9215746EGfg
 1        (e)  Optional contributions shall be accounted for  in  a
 2    separate Optional Contribution Reserve.
 3        (f)  The  tax levy computed under Section 13-503 shall be
 4    based on  employee  contributions  including  the  amount  of
 5    optional additional employee contributions.
 6        (g)  Service eligible under this Section may include only
 7    service  as  an  employee  as  defined in Section 13-204, and
 8    subject to Section 13-401 and  13-402.   No  service  granted
 9    under Section 13-801 or 13-802 shall be eligible for optional
10    service   credit.    No   optional   service  credit  may  be
11    established for any military  service,  or  for  any  service
12    under  any  other  Article  of  this  Code.  Optional service
13    credit may be established for any period of  disability  paid
14    from  this  Fund,  if  the employee makes additional optional
15    contributions for such period of disability.
16        (h)  This plan of  optional  benefits  and  contributions
17    shall  not  apply  to service prior to withdrawal rendered by
18    any  former  employee  who  re-enters  service  unless   such
19    employee  renders  not  less  than  36  consecutive months of
20    additional service after the date of re-entry.
21        (i)  The  effective  date  of  this  optional   plan   of
22    additional  benefits and contributions shall be the date upon
23    which  approval  was  received  from  the  Internal   Revenue
24    Service, July 31, 1987.
25        (j)  This  plan  of additional benefits and contributions
26    shall expire December 31, 2002.  No additional  contributions
27    may  be made after that date, and no additional benefits will
28    accrue after that date.
29        (k)  The maximum optional benefits for current and  prior
30    service  for  which  an  employee can make contributions in a
31    single year shall be limited to 15 years of service  in  1997
32    and before; 9 years of service in 1998; 6 years of service in
33    1999;  and  3  years  of service in 2000, 2001, and 2002.  No
34    person may establish additional optional benefits under  this
 
HB4509 Engrossed            -4-                LRB9215746EGfg
 1    Section for more than 15 years of service.
 2    (Source: P.A. 90-12, eff. 6-13-97.)

 3        (40 ILCS 5/13-304.1 new)
 4        Sec.  13-304.1.  Optional plan of additional benefits and
 5    contributions made January 1, 2003 through December 31, 2007.
 6        (a)  While this  plan  is  in  effect,  an  employee  may
 7    establish   optional   additional  credit  toward  additional
 8    benefits  for  eligible  service  by  making  an  irrevocable
 9    written  election  to  make   additional   contributions   as
10    authorized  in  this  Section.  An employee may begin to make
11    additional contributions  under  this  Section,  via  payroll
12    deduction,  no  earlier  than  the  first  pay  period of the
13    calendar year in which  the  employee  fulfills  the  10-year
14    service   requirement   described  in  subsection  (g).   The
15    additional contributions of 4% of salary shall be paid to the
16    Fund on the same basis  and  under  the  same  conditions  as
17    contributions required under Section 13-502.
18        (b)  For service before an irrevocable option is elected,
19    but within the same calendar year, an additional contribution
20    may  be made of 4% of the salary for the applicable period of
21    service, plus interest from the date of service to  the  date
22    of contribution at a rate equal to the higher of 8% per annum
23    or  the  actuarial  investment  return assumption used in the
24    Fund's most recent annual actuarial statement.  All  payments
25    for  past  service  must  be paid within the calendar year in
26    which the service was earned; except that a  person  who  has
27    withdrawn  from  service  and  is  eligible  for a retirement
28    annuity  under  Section  13-301  may   pay   the   additional
29    contribution  for  past  service  within the calendar year of
30    withdrawal within the 30 days after withdrawal from  service,
31    as  long  as  payment  is  made in full before the retirement
32    annuity commences and before December 31, 2007.   Nothing  in
33    this Section may be construed to allow an additional optional
 
HB4509 Engrossed            -5-                LRB9215746EGfg
 1    contribution  to  be  made  on  the  account  of  a  deceased
 2    employee.
 3        (c)  The  maximum  additional benefit for current service
 4    for which an  employee  may  make  contributions  under  this
 5    Section in a single year is limited to one year of service in
 6    each  of  2003,  2004,  2005,  2006,  and  2007.    The total
 7    additional  benefit  that  may  be  accumulated  under   this
 8    Section, including any additional benefit accumulated under a
 9    prior  optional  benefit plan, is 12% of average final salary
10    at retirement.
11        The additional benefit shall accrue for  all  periods  of
12    eligible service for which additional contributions have been
13    paid  in full in accordance with this Section, subject to the
14    applicable limitations on maximum annuity.
15        The additional benefit shall consist of an additional  1%
16    of  average  final  salary for each year of service for which
17    optional contributions have been paid, to  be  added  to  the
18    employee's  retirement  annuity  as  otherwise computed under
19    this Article.  The calculation of these  additional  benefits
20    shall be subject to the same terms and conditions as are used
21    in  the  calculation  of  the  retirement  annuity under this
22    Article.  The additional benefit shall  be  included  in  the
23    calculation of the automatic annual increase in annuity under
24    Section   13-302(d)  and  in  the  calculation  of  surviving
25    spouse's annuity, where applicable.  However,  no  additional
26    benefit may be granted which produces a total annuity greater
27    than  the  applicable  maximum  established  for that type of
28    annuity in this Article.
29        (d)  Refunds of additional optional contributions made in
30    accordance  with  the  provisions  and  limitations  of  this
31    Section shall be made on the same basis and  under  the  same
32    conditions  as are provided under Section 13-601.  Any refund
33    of contributions that exceed the  limits  specified  in  this
34    Section  shall  be  made  in accordance with established Fund
 
HB4509 Engrossed            -6-                LRB9215746EGfg
 1    policy.
 2        (e)  The additional contributions shall be accounted  for
 3    in a separate Optional Contribution Reserve.
 4        (f)  The  tax levy computed under Section 13-503 shall be
 5    based on employee contributions and the  amount  of  optional
 6    additional   employee  contributions,  as  provided  in  that
 7    Section.
 8        (g)  The  service  eligible   for   optional   additional
 9    contributions  under this Section is limited to service as an
10    employee  as  defined  in  Section  13-204,  and  subject  to
11    Sections 13-401 and 13-402, but  excluding  service  credited
12    under  subsections 13-401(a)4 and 13-401(d).  Service granted
13    under Section 13-801 or 13-802 is not eligible  for  optional
14    additional   contributions.    Eligible  service  is  further
15    limited to service rendered during or after the calendar year
16    in which the employee reaches 10 years of service as  defined
17    under  Section  13-402, exclusive of any credit under Article
18    20.
19        Service eligible for  optional  additional  contributions
20    under  this  Section  includes  any period of disability paid
21    from this Fund that would have been eligible service  if  the
22    employee  were  in  active service rather than disabled.  The
23    additional contributions for a period of disability shall  be
24    calculated  as  4% of the salary that the employee would have
25    received if he or she had been in active service  during  the
26    applicable  period  of  disability,  plus  interest at a rate
27    equal to  the  higher  of  8%  per  annum  or  the  actuarial
28    investment  return  assumption used in the Fund's most recent
29    annual actuarial statement,  compounded  annually,  from  the
30    date of the service to the date of payment.  The contribution
31    must  be  paid  to  the Fund no later than 3 months after the
32    employee returns to service from disability, and in any event
33    prior to December 31, 2007.
34        (h)  The minimum period for which an employee may make an
 
HB4509 Engrossed            -7-                LRB9215746EGfg
 1    irrevocable election to make additional  contributions  shall
 2    be  26  consecutive  pay  periods,  unless the employee first
 3    accumulates the  maximum  optional  credit  as  described  in
 4    subsection (c) of this Section.  The maximum period for which
 5    an  employee  may  make  irrevocable elections for additional
 6    contributions shall be from the date of election through  the
 7    last   pay  period  eligible  for  contributions  under  this
 8    Section.
 9        (i)  This plan of additional benefits  and  contributions
10    expires  on  December  31, 2007.  No additional contributions
11    may be made after that date, and no additional benefits  will
12    accrue after that date.

13        (40 ILCS 5/13-502) (from Ch. 108 1/2, par. 13-502)
14        Sec.  13-502.   Employee  contributions;  deductions from
15    salary.
16        (a)  Retirement annuity and child's annuity.  There shall
17    be deducted from each payment of salary an  amount  equal  to
18    7 1/2%  of  salary  as  the  employee's  contribution for the
19    retirement annuity, including annual increases therefore  and
20    child's annuity.
21        (b)  Surviving spouse's annuity.  There shall be deducted
22    from  each  payment  of  salary  an amount equal to 1 1/2% of
23    salary as  the  employee's  contribution  for  the  surviving
24    spouse's annuity and annual increases therefor.
25        (c)  Pickup  of employee contributions.  The Employer may
26    pick up employee contributions required under subsections (a)
27    and (b) of this Section.  If contributions are picked up they
28    shall be treated as Employer contributions in determining tax
29    treatment under the United States Internal Revenue Code,  and
30    shall  not  be included as gross income of the employee until
31    such time as they are distributed.  The  Employer  shall  pay
32    these  employee  contributions  from the same source of funds
33    used in paying salary to the employee.  The Employer may pick
 
HB4509 Engrossed            -8-                LRB9215746EGfg
 1    up these contributions by a reduction in the cash  salary  of
 2    the employee or by an offset against a future salary increase
 3    or  by  a  combination  of  a  reduction in salary and offset
 4    against a future salary increase.  If employee  contributions
 5    are  picked up they shall be treated for all purposes of this
 6    Article 13, including Sections 13-503 and 13-601, in the same
 7    manner and to the same extent as employee contributions  made
 8    prior to the date picked up.
 9        (d)  Subject  to  the  requirements  of  federal law, the
10    Employer  shall  pick  up  optional  contributions  that  the
11    employee has  elected  to  pay  to  the  Fund  under  Section
12    13-304.1, and the contributions so picked up shall be treated
13    as  employer  contributions  for  the purposes of determining
14    federal tax  treatment.   The  Employer  shall  pick  up  the
15    contributions  by  a  reduction  in  the  cash  salary of the
16    employee and shall pay the contributions from the  same  fund
17    that  is  used to pay earnings to the employee.  The Employer
18    shall, however, continue to withhold federal and State income
19    taxes based upon contributions made  under  Section  13-304.1
20    until the Internal Revenue Service or the federal courts rule
21    that  pursuant to Section 414(h) of the U.S. Internal Revenue
22    Code of 1986, as amended, these contributions  shall  not  be
23    included  as  gross income of the employee until such time as
24    they are distributed or made available.
25        (e)  Each employee is deemed to consent and agree to  the
26    deductions from compensation provided for in this Article.
27    (Source: P.A. 87-794.)

28        (40 ILCS 5/13-503) (from Ch. 108 1/2, par. 13-503)
29        Sec.  13-503.   Tax levy.  The Water Reclamation District
30    shall annually levy a tax upon all the taxable real  property
31    within  the  District  at  a  rate which, when extended, will
32    produce a sum that (i) when added  to  the  amounts  deducted
33    from   the   salaries   of   employees,  interest  income  on
 
HB4509 Engrossed            -9-                LRB9215746EGfg
 1    investments, and other income, will be sufficient to meet the
 2    requirements of the Fund on an actuarially funded basis,  but
 3    (ii)  shall not exceed an amount equal to the total amount of
 4    contributions by the  employees  to  the  Fund  made  in  the
 5    calendar year 2  years prior to the year for which the tax is
 6    levied,  multiplied  by  2.19,  except  that  the  amount  of
 7    employee  contributions  made  on  or  after  January 1, 2003
 8    towards the purchase of additional  optional  benefits  under
 9    Section  13-304.1  shall only be multiplied by 1.00.  The tax
10    shall be levied and collected  in  the  same  manner  as  the
11    general taxes of the District.
12        The  tax  shall  be  exclusive  of and in addition to the
13    amount of tax  the  District  is  now  or  may  hereafter  be
14    authorized   to   levy   for   general   purposes  under  the
15    Metropolitan Water Reclamation  District  Act  or  under  any
16    other  laws  which  may  limit  the amount of tax for general
17    purposes.  The county clerk of any county,  in  reducing  tax
18    levies  as  may  be authorized by law, shall not consider any
19    such tax as a part of  the  general  tax  levy  for  District
20    purposes, and shall not include the same in any limitation of
21    the  percent  of  the assessed valuation upon which taxes are
22    required to be extended.
23        Revenues derived from the tax shall be paid to  the  Fund
24    for the benefit of the Fund.
25        If  the  funds available for the purposes of this Article
26    are insufficient during any year to meet the requirements  of
27    this   Article,  the  District  may  issue  tax  anticipation
28    warrants or notes, as provided by law,  against  the  current
29    tax levy.
30        The   Board   shall  submit  annually  to  the  Board  of
31    Commissioners of the  District  an  estimate  of  the  amount
32    required  to  be  raised  by taxation for the purposes of the
33    Fund.  The Board of Commissioners shall review  the  estimate
34    and determine the tax to be levied for such purposes.
 
HB4509 Engrossed            -10-               LRB9215746EGfg
 1    (Source: P.A. 87-794.)

 2        Section  90.  The State Mandates Act is amended by adding
 3    Section 8.26 as follows:

 4        (30 ILCS 805/8.26 new)
 5        Sec. 8.26. Exempt mandate.   Notwithstanding  Sections  6
 6    and  8 of this Act, no reimbursement by the State is required
 7    for  the  implementation  of  any  mandate  created  by  this
 8    amendatory Act of the 92nd General Assembly.

 9        Section 99. Effective date.  This Act takes  effect  upon
10    becoming law.

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