Bill Text: IL HB0164 | 2017-2018 | 100th General Assembly | Enrolled

Bill Title: Amends the Illinois Pension Code. Makes a technical change in a Section concerning definitions.

Spectrum: Moderate Partisan Bill (Democrat 6-1)

Status: (Enrolled) 2017-06-27 - Sent to the Governor [HB0164 Detail]

Download: Illinois-2017-HB0164-Enrolled.html

HB0164 EnrolledLRB100 02315 RPS 12320 b
1 AN ACT concerning public employee benefits.
2 Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
4 Section 5. The Illinois Pension Code is amended by changing
5Sections 13-305 and 13-601 as follows:
6 (40 ILCS 5/13-305) (from Ch. 108 1/2, par. 13-305)
7 Sec. 13-305. Surviving spouse's annuity; eligibility. A
8surviving spouse who was married to an employee on the date of
9the employee's death while in service, or was married to an
10employee on the date of withdrawal from service and remained
11married to that employee until the employee's death, shall be
12entitled to a surviving spouse's annuity payable for life.
13However, the annuity shall not be payable to the surviving
14spouse of (1) an employee who withdraws from service before
15attaining the minimum retirement age unless the deceased
16employee had at least 10 years of service, or at least 5 years
17of service if the employee was eligible for an annuity upon
18attainment of age 62 pursuant to Section 13-301(b) or had been
19receiving a retirement annuity pursuant to Section 13-301(d),
20or (2) an employee not described in item (1) who first enters
21service on or after the effective date of this amendatory Act
22of 1997 and who has been employed as an employee for (i) less
23than 36 months from the date of the employee's original entry

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1into service or (ii) less than 12 months from the employee's
2date of latest re-entry into service; except as otherwise
3provided in Section 13-306(a) for an employee whose death
4arises out of or in the course of the employee's service to the
6 Notwithstanding any other provision of this Section and
7notwithstanding the forfeiture of rights provisions under
8subsection (e) of Section 13-601, surviving spouse annuity
9eligibility or eligibility for alternative survivor's
10benefits, if applicable, shall be extended to the spouse or
11civil union partner of an annuitant who retired prior to June
121, 2011 and received a refund of surviving spouse annuity
13contributions as provided in subsection (b) of Section 13-601
14if the annuitant (i) repaid the surviving spouse annuity
15contributions under subsection (b-5) of Section 13-601, (ii)
16could not enter into either a civil union or marriage
17recognized in the State of Illinois prior to that date, and
18(iii) became:
19 (A) a party to a civil union or a party to a legal
20 relationship that is recognized as a civil union or
21 marriage under the Illinois Religious Freedom Protection
22 and Civil Union Act on or after June 1, 2011 and before
23 July 1, 2016 and remains such a party;
24 (B) a party to a marriage under the Illinois Marriage
25 and Dissolution of Marriage Act on or after February 26,
26 2014 and before July 1, 2016 and remains such a party; or

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1 (C) a party to a marriage, civil union, or other legal
2 relationship that, at the time it was formed, was not
3 legally recognized in Illinois but was subsequently
4 recognized as a civil union or marriage under the Illinois
5 Religious Freedom Protection and Civil Union Act on or
6 after June 1, 2011 and before July 1, 2016, a marriage
7 under the Illinois Marriage and Dissolution of Marriage Act
8 on or after February 26, 2014 and before July 1, 2016, or
9 both, and remains such a party.
10 A dissolution of marriage after retirement shall not divest
11the employee's spouse of the entitlement to a surviving
12spouse's annuity upon the subsequent death of the employee,
13provided that the surviving spouse and the deceased employee
14had been married to each other for a period of not less than 10
15continuous years on the date of retirement.
16 For purposes of Section 1-103.1, the changes made by this
17amendatory Act of the 100th General Assembly apply to persons
18not in service on or after the effective date of this
19amendatory Act of the 100th General Assembly.
20(Source: P.A. 94-621, eff. 8-18-05.)
21 (40 ILCS 5/13-601) (from Ch. 108 1/2, par. 13-601)
22 Sec. 13-601. Refunds.
23 (a) Withdrawal from service. Upon withdrawal from service,
24an employee who first became a member before January 1, 2011,
25who is under age 55 (age 50 if the employee first entered

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1service before June 13, 1997), or an employee age 55 (age 50 if
2the employee first entered service before June 13, 1997) or
3over but less than age 60 having less than 20 years of service,
4or an employee age 60 or over having less than 5 years of
5service shall be entitled, upon application, to a refund of
6total contributions from salary deductions or amounts
7otherwise paid under this Article by the employee. An employee
8who first becomes a member on or after January 1, 2011, who
9withdraws before age 62 regardless of length of service, or who
10withdraws with less than 10 years of service regardless of age
11is entitled to a refund of total contributions from salary
12deductions or amounts otherwise paid under this Article by the
13employee. The refund shall not include interest credited to the
14contributions. The Board may, in its discretion, withhold
15payment of a refund for a period not to exceed one year from
16the date of filing an application for refund.
17 (b) Surviving spouse's annuity contributions. A refund of
18all amounts deducted from salary or otherwise contributed by an
19employee for the surviving spouse's annuity shall be paid upon
20retirement to any employee who on the date of retirement is
21either not married or is married but whose spouse is not
22eligible for a surviving spouse's annuity paid wholly or in
23part under this Article. The refund shall include interest on
24each contribution at the rate of 3% per annum compounded
25annually from the date of the contribution to the date of the

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1 (b-5) An annuitant who (i) retired prior to June 1, 2011,
2(ii) received a refund of surviving spouse's annuity
3contributions under subsection (b), and (iii) thereafter
4became and remains a party to a civil union or marriage, as
5described in Section 13-305, may, within a period of one year
6beginning 5 months after the effective date of this amendatory
7Act of the 100th General Assembly, and in accordance with any
8rules adopted by the Board and consents required by the Board,
9make an irrevocable election to re-establish rights to a
10surviving spouse annuity under Sections 13-305 and 13-306 or to
11alternative survivor's benefits under subsection (d) of
12Section 13-314, whichever is applicable, by paying to the Fund:
13(1) the total amount of the refund received for surviving
14spouse's annuity contributions; and (2) interest thereon at the
15actuarially assumed rate of return at the time of the election
16from the date of the refund to the date of repayment in full.
17Such election may only be made by the annuitant.
18 The Fund shall allow the annuitant to repay the total
19amount of the refund, plus interest, over a period not to
20exceed 24 months. To the extent permitted by the Internal
21Revenue Code of 1986, as amended, and for federal and State tax
22purposes, if a member pays in monthly installments by reducing
23the monthly annuity by the amount of the otherwise applicable
24contribution, the monthly amount by which the annuitant's
25benefit is reduced shall not be treated as a contribution by
26the annuitant, but rather as a reduction of the annuitant's

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1monthly annuity. In the event of the death of the annuitant
2prior to repayment of the total amount of the refund, plus
3interest, the amount owed as of the date of death shall be
4deducted from the spouse annuity by a reduction in the
5surviving spouse's monthly annuity. The death of the spouse or
6civil union partner prior to the annuitant's death shall not
7void the election.
8 (c) Payment of Refunds After Death. Whenever any refund is
9payable after the death of the employee or annuitant as
10provided for in this Article, the refund shall be paid as
11follows: to the employee's surviving spouse, but if there is no
12surviving spouse then in accordance with the employee's written
13designation of beneficiary filed with the Board on the
14prescribed form before the employee's death. If there is no
15such designation of beneficiary, then to the employee's
16surviving children in equal parts to each. If there are no such
17children, the refund shall be paid to the heirs of the employee
18according to the law of descent and distribution of the State
19of Illinois.
20 If a personal representative of the estate has not been
21appointed within 90 days from the date on which a refund became
22payable, the refund may be applied, in the discretion of the
23Board, toward the payment of the employee's or the surviving
24spouse's burial expenses. Any remaining balance shall be paid
25to the heirs of the employee according to the law of descent
26and distribution of the State of Illinois.

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1 Whenever the total accumulations to the account of an
2employee from employee contributions other than the
3contribution for the cost of living increase, including
4interest to the employee's date of withdrawal, have not been
5paid to the employee and surviving spouse as a retirement or
6spouse's annuity before the death of the employee and spouse, a
7refund shall be paid as follows: an amount equal to the excess
8of such amounts over the amounts paid on such annuities without
9interest on either such amount.
10 If a reversionary annuity becomes payable under Section
1113-303, the refund provided in this section shall not be paid
12until the death of the reversionary annuitant and the refund
13otherwise payable under this section shall be then further
14reduced by the amount of the reversionary annuity paid.
15 (d) In lieu of annuity. Notwithstanding the provisions set
16forth in subsection (a) of this section, whenever an employee's
17or surviving spouse's annuity will be less than $200 per month,
18the employee or surviving spouse, as the case may be, may elect
19to receive a refund of accumulated employee contributions;
20provided, however, that if the election is made by a surviving
21spouse the refund shall be reduced by any amounts theretofore
22paid to the employee in the form of an annuity.
23 (e) Forfeiture of rights. An employee or surviving spouse
24who receives a refund forfeits the right to receive an annuity
25or any other benefit payable under this Article except that if
26the refund is to a surviving spouse, any child or children of

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1the employee shall not be deprived of the right to receive a
2child's annuity as provided in Section 13-308 of this Article,
3and the payment of a child's annuity shall not reduce the
4amount refundable to the surviving spouse.
5(Source: P.A. 95-586, eff. 8-31-07; 96-251, eff. 8-11-09;
696-1490, eff. 1-1-11.)
7 Section 99. Effective date. This Act takes effect upon
8becoming law.