Bill Text: IL HB3408 | 2015-2016 | 99th General Assembly | Engrossed

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Bill Title: Amends the State Universities Article of the Illinois Pension Code. Provides that "earnings" does not include amounts associated with housing allowance or vehicle allowance payable to an employee. Effective immediately.

Spectrum: Partisan Bill (Democrat 4-0)

Status: (Engrossed - Dead) 2016-05-13 - Rule 3-9(a) / Re-referred to Assignments [HB3408 Detail]

Download: Illinois-2015-HB3408-Engrossed.html

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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
Sections 15-110 and 15-111 and by adding Section 15-111.5 as
follows:
(40 ILCS 5/15-110) (from Ch. 108 1/2, par. 15-110)
Sec. 15-110. Basic compensation. "Basic compensation":
Subject to Section 15-111.5, the The gross basic rate of salary
or wages payable by an employer, including:
(1) the value of maintenance, board, living quarters,
personal laundry or other allowances furnished in lieu of
salary which are considered gross income under the federal
Federal Internal Revenue Code of 1986, as amended; ,
(2) the employee contributions required under Section
15-157; , and
(3) the amount paid by any employer to a custodial
account for investment in regulated investment company
stocks for the benefit of the employee pursuant to the
University Employees Custodial Accounts Act; "An Act in
relation to payments to custodial accounts for the benefit
of employees of public institutions of higher education",
approved September 9, 1983, and

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(4) the amount of the premium payable by any employer
to an insurance company or companies on an annuity
contract, pursuant to the employee's election to accept a
reduction in earnings or forego an increase in earnings
under Section 30c of the State Finance Act "An Act in
relation to State Finance," approved June 10, 1919, as
amended, or a tax-sheltered annuity plan approved by any
employer; and
(5) the amount of any elective deferral to a deferred
compensation plan established under Article 24 of this Code
pursuant to Section 457(b) of the federal Internal Revenue
Code of 1986, as amended.
Basic compensation does not include (1) salary or wages for
overtime or other extra service; (2) prospective salary or
wages under a summer teaching contract not yet entered upon;
and (3) overseas differential allowances, quarters allowances,
post allowances, educational allowances and transportation
allowances paid by an employer under a contract with the
federal government or its agencies for services rendered in
other countries. If an employee elects to receive in lieu of
cash salary or wages, fringe benefits which are not taxable
under the federal Federal Internal Revenue Code of 1986, as
amended, the amount of the cash salary or wages which is waived
shall be included in determining basic compensation.
(Source: P.A. 84-1308.)

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(40 ILCS 5/15-111) (from Ch. 108 1/2, par. 15-111)
(Text of Section WITHOUT the changes made by P.A. 98-599,
which has been held unconstitutional)
Sec. 15-111. Earnings.
(a) "Earnings": Subject to Section 15-111.5, an An amount
paid for personal services equal to the sum of the basic
compensation plus extra compensation for summer teaching,
overtime or other extra service. For periods for which an
employee receives service credit under subsection (c) of
Section 15-113.1 or Section 15-113.2, earnings are equal to the
basic compensation on which contributions are paid by the
employee during such periods. Compensation for employment
which is irregular, intermittent and temporary shall not be
considered earnings, unless the participant is also receiving
earnings from the employer as an employee under Section 15-107.
With respect to transition pay paid by the University of
Illinois to a person who was a participating employee employed
in the fire department of the University of Illinois's
Champaign-Urbana campus immediately prior to the elimination
of that fire department:
(1) "Earnings" includes transition pay paid to the
employee on or after the effective date of this amendatory
Act of the 91st General Assembly.
(2) "Earnings" includes transition pay paid to the
employee before the effective date of this amendatory Act
of the 91st General Assembly only if (i) employee

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contributions under Section 15-157 have been withheld from
that transition pay or (ii) the employee pays to the System
before January 1, 2001 an amount representing employee
contributions under Section 15-157 on that transition pay.
Employee contributions under item (ii) may be paid in a
lump sum, by withholding from additional transition pay
accruing before January 1, 2001, or in any other manner
approved by the System. Upon payment of the employee
contributions on transition pay, the corresponding
employer contributions become an obligation of the State.
(b) For a Tier 2 member, the annual earnings shall not
exceed $106,800; however, that amount shall annually
thereafter be increased by the lesser of (i) 3% of that amount,
including all previous adjustments, or (ii) one half the annual
unadjusted percentage increase (but not less than zero) in the
consumer price index-u for the 12 months ending with the
September preceding each November 1, including all previous
adjustments.
For the purposes of this Section, "consumer price index u"
means the index published by the Bureau of Labor Statistics of
the United States Department of Labor that measures the average
change in prices of goods and services purchased by all urban
consumers, United States city average, all items, 1982-84 =
100. The new amount resulting from each annual adjustment shall
be determined by the Public Pension Division of the Department
of Insurance and made available to the boards of the retirement

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systems and pension funds by November 1 of each year.
(Source: P.A. 98-92, eff. 7-16-13.)
(40 ILCS 5/15-111.5 new)
Sec. 15-111.5. Basic compensation and earnings
restrictions. For an employee who first becomes a participant
on or after the effective date of this amendatory Act of the
99th General Assembly, basic compensation under Section 15-110
and earnings under Section 15-111 shall not include housing
allowances, vehicle allowances, or club memberships dues.
Section 99. Effective date. This Act takes effect upon
becoming law.