HB4867 93RD GENERAL ASSEMBLY

LRB093 14989 LRD 40558 b

93RD GENERAL ASSEMBLY
State of Illinois
2003 and 2004
HB4867

Introduced 2/4/2004, by Angelo Saviano

SYNOPSIS AS INTRODUCED:

40 ILCS 5/17-116.1	from Ch. 108 1/2, par. 17-116.1
30 ILCS 805/8.28 new

Amends the Chicago Teachers Article of the Illinois Pension Code. Provides that a member who retires after June 1, 2005 and before June 30, 2010 and within 6 months of the last day of teaching for which contributions were required may make a one time contribution to the system and thereby avoid early retirement reduction in allowance. Provides that an election by a member to make such a contribution obligates the last Employer to make a one time contribution to the Fund. Amends the State Mandates Act to require implementation without reimbursement. Effective immediately.

FISCAL NOTE ACT MAY APPLY

PENSION IMPACT NOTE ACT MAY APPLY

STATE MANDATES ACT MAY REQUIRE REIMBURSEMENT

A BILL FOR

AN ACT concerning public employee benefits.

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

Section 5. The Illinois Pension Code is amended by changing Section 17-116.1 as follows:

(40 ILCS 5/17-116.1) (from Ch. 108 1/2, par. 17-116.1)

Sec. 17-116.1. Early retirement without discount.

(a) A member retiring after June 1, 1980 and before June 30, 1995 and within 6 months of the last day of teaching for which retirement contributions were required, may elect at the time of application to make a one time employee contribution to the system and thereby avoid the early retirement reduction in allowance specified in paragraph (4) of Section 17-116 of this Article. The exercise of the election shall obligate the last Employer to also make a one time non-refundable contribution to the Fund.

(a-5) A member retiring after June 1, 2005 and before June 30, 2010 and within 6 months of the last day of teaching for which retirement contributions were required, may elect at the time of application to make a one time employee contribution to the system and thereby avoid the early retirement reduction in allowance specified in paragraph (4) of Section 17-116. The exercise of the election shall obligate the last Employer to also make a one time non-refundable contribution to the Fund.

(b) Subject to authorization by the Employer as provided in subsection (c), a member retiring on or after June 30, 1995 and on or before June 1, 2005 June 30, 2005 and within 6 months of the last day of teaching for which retirement contributions were required may elect at the time of application to make a one-time employee contribution to the Fund and thereby avoid the early retirement reduction in allowance specified in paragraph (4) of Section 17-116. The exercise of the election shall obligate the last Employer to also make a one-time nonrefundable contribution to the Fund.

(c) The benefits provided in subsection (b) are available only to members who retire, during a specified period, from employment with an Employer that has adopted and filed with the Board a resolution expressly providing for the creation of an early retirement without discount program under this Section for that period.

The Employer has the full discretion and authority to determine whether an early retirement without discount program is in its best interest and to provide such a program to its eligible employees in accordance with this Section. The Employer may decide to authorize such a program for one or more of the following periods: for the period beginning July 1, 1997 and ending June 30, 1998, in which case the resolution must be adopted by January 1, 1998; for the period beginning July 1, 1998 and ending June 30, 1999, in which case the resolution must be adopted by March 31, 1998; for the period beginning July 1, 1999 and ending June 30, 2000, in which case the resolution must be adopted by March 31, 1999; for the period beginning July 1, 2000 and ending June 30, 2001, in which case the resolution must be adopted by March 31, 2000; for the period beginning July 1, 2001 and ending June 30, 2002, in which case the resolution must be adopted by March 31, 2001; for the period beginning July 1, 2002 and ending June 30, 2003, in which case the resolution must be adopted by March 31, 2002; for the period beginning July 1, 2003 and ending June 30, 2004, in which case the resolution must be adopted by March 31, 2003; and for the period beginning July 1, 2004 and ending June 1, 2005 June 30, 2005, in which case the resolution must be adopted by March 31, 2004. The resolution must be filed with the Board within 10 days after it is adopted. A single resolution may authorize an early retirement without discount program as provided in this Section for more than one period.

Notwithstanding Section 17-157, the Employer shall also have full discretion and authority to determine whether to allow its employees who withdrew from service on or after June 30, 1995 and before June 27, 1997 to participate in an early retirement without discount program under subsection (b). An early retirement without discount program for those who withdrew from service on or after June 30, 1995 and before June 27, 1997 may be authorized only by a resolution of the Employer that is adopted by January 1, 1998 and filed with the Board within 10 days after its adoption. If such a resolution is duly adopted and filed, a person who (i) withdrew from service with the Employer on or after June 30, 1995 and before June 27, 1997, (ii) qualifies for early retirement without discount under subsection (b), (iii) applies to the Fund within 90 days after the authorizing resolution is adopted, and (iv) pays the required employee contribution shall have his or her retirement pension recalculated in accordance with subsection (b). The resulting increase shall be effective retroactively to the starting date of the retirement pension.

(d) The one-time employee contribution shall be equal to 7% of the retiring member's highest full-time annual salary rate used in the determination of the average salary rate for retirement pension, or if not full-time then the full-time equivalent, multiplied by (1) the number of years the teacher is under age 60, or (2) the number of years the employee's creditable service is less than 34 years, whichever is less.

The Employer contribution shall be 20% of such salary multiplied by such number of years.

(e) Upon receipt of the application and election, the Board shall determine the one time employee and Employer contributions. The provisions of this Section shall not be applicable until the employee contribution, if any, has been received by the Fund; however, the date that contribution is received shall not be considered in determining the effective date of retirement.

(f) The number of employees who may retire under this Section in any year may be limited at the option of the Employer to a specified percentage of those eligible, not lower than 30%, with the right to participate to be allocated among those applying on the basis of seniority in the service of the Employer.

(Source: P.A. 90-32, eff. 6-27-97; 90-448, eff. 8-16-97; 90-566, eff. 1-2-98; 91-17, eff. 6-4-99.)

Section 90. The State Mandates Act is amended by adding Section 8.28 as follows:

(30 ILCS 805/8.28 new)

Sec. 8.28. Exempt mandate. Notwithstanding Sections 6 and 8 of this Act, no reimbursement by the State is required for the implementation of any mandate created by this amendatory Act of the 93rd General Assembly.

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