Bill Text: IL SB2194 | 2017-2018 | 100th General Assembly | Introduced


Bill Title: Amends the State Employee, State Universities, Downstate Teacher, and Chicago Teacher Articles of the Illinois Pension Code. Requires active Tier 1 employees to elect either to (i) have automatic annual increases in retirement and survivor's annuities delayed and reduced or (ii) maintain their current benefit package with additional limitations on pensionable salary. Provides that a Tier 1 employee who elects item (i) is entitled to have future increases in income treated as pensionable income, have contributions reduced to a specified rate, and receive a consideration payment of 10% of contributions made prior to the election. Provides that a Tier 1 employee who elects item (ii) is not eligible to have future increases in income treated as pensionable income. Makes funding changes. Amends the State Pension Funds Continuing Appropriation Act to provide a continuing appropriation for the amounts of the consideration payments. Amends various Acts to make conforming changes. Amends the Illinois Educational Labor Relations Act and the Illinois Public Labor Relations Act to prohibit bargaining and interest arbitration regarding certain changes made by the amendatory Act and to provide that no action of the employer taken to implement that prohibition shall give rise to an unfair labor practice under those Acts; exempts certain existing agreements. Amends the State Mandates Act to require implementation without reimbursement. Makes other changes. Effective immediately.

Spectrum: Partisan Bill (Republican 3-0)

Status: (Introduced) 2017-10-10 - Chief Sponsor Changed to Sen. William E. Brady [SB2194 Detail]

Download: Illinois-2017-SB2194-Introduced.html


100TH GENERAL ASSEMBLY
State of Illinois
2017 and 2018
SB2194

Introduced 4/27/2017, by Sen. Christine Radogno

SYNOPSIS AS INTRODUCED:
See Index

Amends the State Employee, State Universities, Downstate Teacher, and Chicago Teacher Articles of the Illinois Pension Code. Requires active Tier 1 employees to elect either to (i) have automatic annual increases in retirement and survivor's annuities delayed and reduced or (ii) maintain their current benefit package with additional limitations on pensionable salary. Provides that a Tier 1 employee who elects item (i) is entitled to have future increases in income treated as pensionable income, have contributions reduced to a specified rate, and receive a consideration payment of 10% of contributions made prior to the election. Provides that a Tier 1 employee who elects item (ii) is not eligible to have future increases in income treated as pensionable income. Makes funding changes. Amends the State Pension Funds Continuing Appropriation Act to provide a continuing appropriation for the amounts of the consideration payments. Amends various Acts to make conforming changes. Amends the Illinois Educational Labor Relations Act and the Illinois Public Labor Relations Act to prohibit bargaining and interest arbitration regarding certain changes made by the amendatory Act and to provide that no action of the employer taken to implement that prohibition shall give rise to an unfair labor practice under those Acts; exempts certain existing agreements. Amends the State Mandates Act to require implementation without reimbursement. Makes other changes. Effective immediately.
LRB100 12225 RPS 24730 b
FISCAL NOTE ACT MAY APPLY
PENSION IMPACT NOTE ACT MAY APPLY
STATE MANDATES ACT MAY REQUIRE REIMBURSEMENT

A BILL FOR

SB2194LRB100 12225 RPS 24730 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 Public Labor Relations Act is
5amended by changing Sections 10 and 15 and by adding Section
67.6 as follows:
7 (5 ILCS 315/7.6 new)
8 Sec. 7.6. No collective bargaining or interest arbitration
9regarding certain changes to the Illinois Pension Code.
10 (a) Notwithstanding any other provision of this Act,
11employers shall not be required to bargain over matters
12affected by the changes, the impact of the changes, and the
13implementation of the changes to Article 14, 15, 16, or 17 of
14the Illinois Pension Code made by the addition of Section
1514-106.5, 15-132.9, 16-122.9, or 17-115.5 of the Illinois
16Pension Code, which are deemed to be prohibited subjects of
17bargaining. Notwithstanding any provision of this Act, the
18changes, impact of the changes, or implementation of the
19changes to Article 14, 15, 16, or 17 of the Illinois Pension
20Code made by the addition of Section 14-106.5, 15-132.9,
2116-122.9, or 17-115.5 of the Illinois Pension Code shall not be
22subject to interest arbitration or any award issued pursuant to
23interest arbitration. The provisions of this Section shall not

SB2194- 2 -LRB100 12225 RPS 24730 b
1apply to an employment contract or collective bargaining
2agreement that is in effect on the effective date of this
3amendatory Act of the 100th General Assembly. However, any such
4contract or agreement that is modified, amended, renewed, or
5superseded after the effective date of this amendatory Act of
6the 100th General Assembly shall be subject to the provisions
7of this Section. Each employer with active employees
8participating in a retirement system or pension fund
9established under Article 14, 15, 16, or 17 of the Illinois
10Pension Code shall comply with and be subject to the provisions
11of this amendatory Act of the 100th General Assembly. The
12provisions of this Section shall not apply to the ability of
13any employer and employee representative to bargain
14collectively with regard to the pick up of employee
15contributions pursuant to Section 14-133.1, 15-157.1,
1616-152.1, 17-130.1, or 17-130.2 of the Illinois Pension Code.
17 (b) Subject to and except for the matters set forth in
18subsection (a) of this Section that are deemed prohibited
19subjects of bargaining, nothing in this Section shall be
20construed as otherwise limiting any of the obligations and
21requirements applicable to employers under any of the
22provisions of this Act, including, but not limited to, the
23requirement to bargain collectively with regard to policy
24matters directly affecting wages, hours, and terms and
25conditions of employment as well as the impact thereon upon
26request by employee representatives. Subject to and except for

SB2194- 3 -LRB100 12225 RPS 24730 b
1the matters set forth in subsection (a) of this Section that
2are deemed prohibited subjects of bargaining, nothing in this
3Section shall be construed as otherwise limiting any of the
4rights of employees or employee representatives under the
5provisions of this Act.
6 (c) In case of any conflict between this Section and any
7other provisions of this Act or any other law, the provisions
8of this Section shall control.
9 (5 ILCS 315/10) (from Ch. 48, par. 1610)
10 Sec. 10. Unfair labor practices.
11 (a) It shall be an unfair labor practice for an employer or
12its agents:
13 (1) to interfere with, restrain or coerce public
14 employees in the exercise of the rights guaranteed in this
15 Act or to dominate or interfere with the formation,
16 existence or administration of any labor organization or
17 contribute financial or other support to it; provided, an
18 employer shall not be prohibited from permitting employees
19 to confer with him during working hours without loss of
20 time or pay;
21 (2) to discriminate in regard to hire or tenure of
22 employment or any term or condition of employment in order
23 to encourage or discourage membership in or other support
24 for any labor organization. Nothing in this Act or any
25 other law precludes a public employer from making an

SB2194- 4 -LRB100 12225 RPS 24730 b
1 agreement with a labor organization to require as a
2 condition of employment the payment of a fair share under
3 paragraph (e) of Section 6;
4 (3) to discharge or otherwise discriminate against a
5 public employee because he has signed or filed an
6 affidavit, petition or charge or provided any information
7 or testimony under this Act;
8 (4) subject to and except as provided in Section 7.6,
9 to refuse to bargain collectively in good faith with a
10 labor organization which is the exclusive representative
11 of public employees in an appropriate unit, including, but
12 not limited to, the discussing of grievances with the
13 exclusive representative; however, no actions of the
14 employer taken to implement or otherwise comply with the
15 provisions of subsection (a) of Section 7.6 shall
16 constitute or give rise to an unfair labor practice under
17 this Act;
18 (5) to violate any of the rules and regulations
19 established by the Board with jurisdiction over them
20 relating to the conduct of representation elections or the
21 conduct affecting the representation elections;
22 (6) to expend or cause the expenditure of public funds
23 to any external agent, individual, firm, agency,
24 partnership or association in any attempt to influence the
25 outcome of representational elections held pursuant to
26 Section 9 of this Act; provided, that nothing in this

SB2194- 5 -LRB100 12225 RPS 24730 b
1 subsection shall be construed to limit an employer's right
2 to internally communicate with its employees as provided in
3 subsection (c) of this Section, to be represented on any
4 matter pertaining to unit determinations, unfair labor
5 practice charges or pre-election conferences in any formal
6 or informal proceeding before the Board, or to seek or
7 obtain advice from legal counsel. Nothing in this paragraph
8 shall be construed to prohibit an employer from expending
9 or causing the expenditure of public funds on, or seeking
10 or obtaining services or advice from, any organization,
11 group, or association established by and including public
12 or educational employers, whether covered by this Act, the
13 Illinois Educational Labor Relations Act or the public
14 employment labor relations law of any other state or the
15 federal government, provided that such services or advice
16 are generally available to the membership of the
17 organization, group or association, and are not offered
18 solely in an attempt to influence the outcome of a
19 particular representational election; or
20 (7) to refuse to reduce a collective bargaining
21 agreement to writing or to refuse to sign such agreement.
22 (b) It shall be an unfair labor practice for a labor
23organization or its agents:
24 (1) to restrain or coerce public employees in the
25 exercise of the rights guaranteed in this Act, provided,
26 (i) that this paragraph shall not impair the right of a

SB2194- 6 -LRB100 12225 RPS 24730 b
1 labor organization to prescribe its own rules with respect
2 to the acquisition or retention of membership therein or
3 the determination of fair share payments and (ii) that a
4 labor organization or its agents shall commit an unfair
5 labor practice under this paragraph in duty of fair
6 representation cases only by intentional misconduct in
7 representing employees under this Act;
8 (2) to restrain or coerce a public employer in the
9 selection of his representatives for the purposes of
10 collective bargaining or the settlement of grievances; or
11 (3) to cause, or attempt to cause, an employer to
12 discriminate against an employee in violation of
13 subsection (a)(2);
14 (4) to refuse to bargain collectively in good faith
15 with a public employer, if it has been designated in
16 accordance with the provisions of this Act as the exclusive
17 representative of public employees in an appropriate unit;
18 (5) to violate any of the rules and regulations
19 established by the boards with jurisdiction over them
20 relating to the conduct of representation elections or the
21 conduct affecting the representation elections;
22 (6) to discriminate against any employee because he has
23 signed or filed an affidavit, petition or charge or
24 provided any information or testimony under this Act;
25 (7) to picket or cause to be picketed, or threaten to
26 picket or cause to be picketed, any public employer where

SB2194- 7 -LRB100 12225 RPS 24730 b
1 an object thereof is forcing or requiring an employer to
2 recognize or bargain with a labor organization of the
3 representative of its employees, or forcing or requiring
4 the employees of an employer to accept or select such labor
5 organization as their collective bargaining
6 representative, unless such labor organization is
7 currently certified as the representative of such
8 employees:
9 (A) where the employer has lawfully recognized in
10 accordance with this Act any labor organization and a
11 question concerning representation may not
12 appropriately be raised under Section 9 of this Act;
13 (B) where within the preceding 12 months a valid
14 election under Section 9 of this Act has been
15 conducted; or
16 (C) where such picketing has been conducted
17 without a petition under Section 9 being filed within a
18 reasonable period of time not to exceed 30 days from
19 the commencement of such picketing; provided that when
20 such a petition has been filed the Board shall
21 forthwith, without regard to the provisions of
22 subsection (a) of Section 9 or the absence of a showing
23 of a substantial interest on the part of the labor
24 organization, direct an election in such unit as the
25 Board finds to be appropriate and shall certify the
26 results thereof; provided further, that nothing in

SB2194- 8 -LRB100 12225 RPS 24730 b
1 this subparagraph shall be construed to prohibit any
2 picketing or other publicity for the purpose of
3 truthfully advising the public that an employer does
4 not employ members of, or have a contract with, a labor
5 organization unless an effect of such picketing is to
6 induce any individual employed by any other person in
7 the course of his employment, not to pick up, deliver,
8 or transport any goods or not to perform any services;
9 or
10 (8) to refuse to reduce a collective bargaining
11 agreement to writing or to refuse to sign such agreement.
12 (c) The expressing of any views, argument, or opinion or
13the dissemination thereof, whether in written, printed,
14graphic, or visual form, shall not constitute or be evidence of
15an unfair labor practice under any of the provisions of this
16Act, if such expression contains no threat of reprisal or force
17or promise of benefit.
18(Source: P.A. 86-412; 87-736.)
19 (5 ILCS 315/15) (from Ch. 48, par. 1615)
20 (Text of Section WITHOUT the changes made by P.A. 98-599,
21which has been held unconstitutional)
22 Sec. 15. Act Takes Precedence.
23 (a) In case of any conflict between the provisions of this
24Act and any other law (other than Section 5 of the State
25Employees Group Insurance Act of 1971 and other than the

SB2194- 9 -LRB100 12225 RPS 24730 b
1changes made to the Illinois Pension Code by this amendatory
2Act of the 96th General Assembly), executive order or
3administrative regulation relating to wages, hours and
4conditions of employment and employment relations, the
5provisions of this Act or any collective bargaining agreement
6negotiated thereunder shall prevail and control. Nothing in
7this Act shall be construed to replace or diminish the rights
8of employees established by Sections 28 and 28a of the
9Metropolitan Transit Authority Act, Sections 2.15 through 2.19
10of the Regional Transportation Authority Act. The provisions of
11this Act are subject to Section 5 of the State Employees Group
12Insurance Act of 1971. Nothing in this Act shall be construed
13to replace the necessity of complaints against a sworn peace
14officer, as defined in Section 2(a) of the Uniform Peace
15Officer Disciplinary Act, from having a complaint supported by
16a sworn affidavit.
17 (b) Except as provided in subsection (a) above, any
18collective bargaining contract between a public employer and a
19labor organization executed pursuant to this Act shall
20supersede any contrary statutes, charters, ordinances, rules
21or regulations relating to wages, hours and conditions of
22employment and employment relations adopted by the public
23employer or its agents. Any collective bargaining agreement
24entered into prior to the effective date of this Act shall
25remain in full force during its duration.
26 (c) It is the public policy of this State, pursuant to

SB2194- 10 -LRB100 12225 RPS 24730 b
1paragraphs (h) and (i) of Section 6 of Article VII of the
2Illinois Constitution, that the provisions of this Act are the
3exclusive exercise by the State of powers and functions which
4might otherwise be exercised by home rule units. Such powers
5and functions may not be exercised concurrently, either
6directly or indirectly, by any unit of local government,
7including any home rule unit, except as otherwise authorized by
8this Act.
9 (d) Notwithstanding any other provision of law, no
10collective bargaining agreement entered into, renewed, or
11extended after the effective date of this amendatory Act of the
12100th General Assembly or any arbitration award issued under
13such collective bargaining agreement may violate or conflict
14with the changes made by this amendatory Act of the 100th
15General Assembly.
16(Source: P.A. 95-331, eff. 8-21-07; 96-889, eff. 1-1-11.)
17 Section 10. The Attorney General Act is amended by adding
18Section 5 as follows:
19 (15 ILCS 205/5 new)
20 Sec. 5. Future increases in income. The Office of the
21Attorney General must not pay, offer, or agree to pay any
22future increase in income, as that term is defined in Section
2314-103.42 of the Illinois Pension Code, to any person in a
24manner that violates Section 14-106.5 of the Illinois Pension

SB2194- 11 -LRB100 12225 RPS 24730 b
1Code.
2 Section 15. The Secretary of State Merit Employment Code is
3amended by adding Section 13a as follows:
4 (15 ILCS 310/13a new)
5 Sec. 13a. Future increases in income. The Office of the
6Secretary of State must not pay, offer, or agree to pay any
7future increase in income, as that term is defined in Section
814-103.42 of the Illinois Pension Code, to any person in a
9manner that violates Section 14-106.5 of the Illinois Pension
10Code.
11 Section 20. The Comptroller Merit Employment Code is
12amended by adding Section 13a as follows:
13 (15 ILCS 410/13a new)
14 Sec. 13a. Future increases in income. The Office of the
15Comptroller must not pay, offer, or agree to pay any future
16increase in income, as that term is defined in Section
1714-103.42 of the Illinois Pension Code, to any person in a
18manner that violates Section 14-106.5 of the Illinois Pension
19Code.
20 Section 25. The State Treasurer Employment Code is amended
21by adding Section 12a as follows:

SB2194- 12 -LRB100 12225 RPS 24730 b
1 (15 ILCS 510/12a new)
2 Sec. 12a. Future increases in income. The Office of the
3State Treasurer must not pay, offer, or agree to pay any future
4increase in income, as that term is defined in Section
514-103.42 of the Illinois Pension Code, to any person in a
6manner that violates Section 14-106.5 of the Illinois Pension
7Code.
8 Section 30. The Civil Administrative Code of Illinois is
9amended by adding Section 5-647 as follows:
10 (20 ILCS 5/5-647 new)
11 Sec. 5-647. Future increases in income. A Department must
12not pay, offer, or agree to pay any future increase in income,
13as that term is defined in Section 14-103.42, 15-112.1, or
1416-121.1 of the Illinois Pension Code, to any person in a
15manner that violates Section 14-106.5, 15-132.9, or 16-122.9 of
16the Illinois Pension Code.
17 Section 35. The Illinois Pension Code is amended by
18changing Sections 14-103.10, 14-114, 14-131, 14-133,
1914-135.08, 14-152.1, 15-108.1, 15-111, 15-136, 15-155, 15-157,
2015-165, 15-198, 16-121, 16-133.1, 16-136.1, 16-152, 16-158,
2116-203, 17-116, 17-129, and 17-130 and by adding Sections
2214-103.41, 14-103.42, 14-103.43, 14-106.5, 15-112.1, 15-112.2,

SB2194- 13 -LRB100 12225 RPS 24730 b
115-132.9, 16-107.1, 16-121.1, 16-121.2, 16-122.9, 17-106.05,
217-113.4, 17-113.5, 17-113.6, 17-115.5, and 17-119.2 as
3follows:
4 (40 ILCS 5/14-103.10) (from Ch. 108 1/2, par. 14-103.10)
5 (Text of Section WITHOUT the changes made by P.A. 98-599,
6which has been held unconstitutional)
7 Sec. 14-103.10. Compensation.
8 (a) For periods of service prior to January 1, 1978, the
9full rate of salary or wages payable to an employee for
10personal services performed if he worked the full normal
11working period for his position, subject to the following
12maximum amounts: (1) prior to July 1, 1951, $400 per month or
13$4,800 per year; (2) between July 1, 1951 and June 30, 1957
14inclusive, $625 per month or $7,500 per year; (3) beginning
15July 1, 1957, no limitation.
16 In the case of service of an employee in a position
17involving part-time employment, compensation shall be
18determined according to the employees' earnings record.
19 (b) For periods of service on and after January 1, 1978,
20all remuneration for personal services performed defined as
21"wages" under the Social Security Enabling Act, including that
22part of such remuneration which is in excess of any maximum
23limitation provided in such Act, and including any benefits
24received by an employee under a sick pay plan in effect before
25January 1, 1981, but excluding lump sum salary payments:

SB2194- 14 -LRB100 12225 RPS 24730 b
1 (1) for vacation,
2 (2) for accumulated unused sick leave,
3 (3) upon discharge or dismissal,
4 (4) for approved holidays.
5 (c) For periods of service on or after December 16, 1978,
6compensation also includes any benefits, other than lump sum
7salary payments made at termination of employment, which an
8employee receives or is eligible to receive under a sick pay
9plan authorized by law.
10 (d) For periods of service after September 30, 1985,
11compensation also includes any remuneration for personal
12services not included as "wages" under the Social Security
13Enabling Act, which is deducted for purposes of participation
14in a program established pursuant to Section 125 of the
15Internal Revenue Code or its successor laws.
16 (e) For members for which Section 1-160 applies for periods
17of service on and after January 1, 2011, all remuneration for
18personal services performed defined as "wages" under the Social
19Security Enabling Act, excluding remuneration that is in excess
20of the annual earnings, salary, or wages of a member or
21participant, as provided in subsection (b-5) of Section 1-160,
22but including any benefits received by an employee under a sick
23pay plan in effect before January 1, 1981. Compensation shall
24exclude lump sum salary payments:
25 (1) for vacation;
26 (2) for accumulated unused sick leave;

SB2194- 15 -LRB100 12225 RPS 24730 b
1 (3) upon discharge or dismissal; and
2 (4) for approved holidays.
3 (f) Notwithstanding the other provisions of this Section,
4for service on or after July 1, 2013, "compensation" does not
5include any stipend payable to an employee for service on a
6board or commission.
7 (g) Notwithstanding any other provision of this Section,
8"compensation" does not include any future increase in income
9that is offered for service by a department to a Tier 1
10employee under this Article pursuant to the condition set forth
11in subsection (c) of Section 14-106.5 and accepted under that
12condition by a Tier 1 employee who has made the election under
13paragraph (2) of subsection (a) of Section 14-106.5.
14 (h) Notwithstanding any other provision of this Section,
15"compensation" does not include any consideration payment made
16to a Tier 1 employee.
17(Source: P.A. 98-449, eff. 8-16-13.)
18 (40 ILCS 5/14-103.41 new)
19 Sec. 14-103.41. Tier 1 employee. "Tier 1 employee": An
20employee under this Article who first became a member or
21participant before January 1, 2011 under any reciprocal
22retirement system or pension fund established under this Code
23other than a retirement system or pension fund established
24under Article 2, 3, 4, 5, 6, or 18 of this Code.

SB2194- 16 -LRB100 12225 RPS 24730 b
1 (40 ILCS 5/14-103.42 new)
2 Sec. 14-103.42. Future increase in income. "Future
3increase in income" means an increase to a Tier 1 employee's
4base pay that is offered by a department to the Tier 1 employee
5for service under this Article after June 30, 2019 that
6qualifies as "compensation", as defined in Section 14-103.10,
7or would qualify as "compensation" but for the fact that it was
8offered to and accepted by the Tier 1 employee under the
9condition set forth in subsection (c) of Section 14-106.5. The
10term "future increase in income" includes an increase to a Tier
111 employee's base pay that is paid to the Tier 1 employee
12pursuant to an extension, amendment, or renewal of any
13employment contract or collective bargaining agreement after
14the effective date of this Section.
15 (40 ILCS 5/14-103.43 new)
16 Sec. 14-103.43. Base pay. As used in Section 14-103.42 of
17this Code, "base pay" means the greater of either (i) the Tier
181 employee's annualized rate of compensation as of June 30,
192019, or (ii) the Tier 1 employee's annualized rate of
20compensation immediately preceding the expiration, renewal, or
21amendment of an employment contract or collective bargaining
22agreement in effect on the effective date of this Section. For
23a person returning to active service as a Tier 1 employee after
24June 30, 2019, however, "base pay" means the employee's
25annualized rate of compensation as of the employee's last date

SB2194- 17 -LRB100 12225 RPS 24730 b
1of service prior to July 1, 2019. The System shall calculate
2the base pay of each Tier 1 employee pursuant to this Section.
3 (40 ILCS 5/14-106.5 new)
4 Sec. 14-106.5. Election by Tier 1 employees.
5 (a) Each active Tier 1 employee shall make an irrevocable
6election either:
7 (1) to agree to delay his or her eligibility for
8 automatic annual increases in retirement annuity as
9 provided in subsection (a-1) of Section 14-114 and to have
10 the amount of the automatic annual increases in his or her
11 retirement annuity and survivors or widow's annuity that
12 are otherwise provided for in this Article calculated,
13 instead, as provided in subsection (a-1) of Section 14-114;
14 or
15 (2) to not agree to paragraph (1) of this subsection.
16 The election required under this subsection (a) shall be
17made by each active Tier 1 employee no earlier than January 1,
182019 and no later than March 31, 2019, except that:
19 (i) a person who becomes a Tier 1 employee under this
20 Article on or after January 1, 2019 must make the election
21 under this subsection (a) within 60 days after becoming a
22 Tier 1 employee; and
23 (ii) a person who returns to active service as a Tier 1
24 employee under this Article on or after January 1, 2019 and
25 has not yet made an election under this Section must make

SB2194- 18 -LRB100 12225 RPS 24730 b
1 the election under this subsection (a) within 60 days after
2 returning to active service as a Tier 1 employee.
3 If a Tier 1 employee fails for any reason to make a
4required election under this subsection within the time
5specified, then the employee shall be deemed to have made the
6election under paragraph (2) of this subsection.
7 (a-5) If this Section is enjoined or stayed by an Illinois
8court or a court of competent jurisdiction pending the entry of
9a final and unappealable decision, and this Section is
10determined to be constitutional or otherwise valid by a final
11unappealable decision of an Illinois court or a court of
12competent jurisdiction, then the election procedure set forth
13in subsection (a) of this Section shall commence on the 180th
14calendar day after the date of the issuance of the final
15unappealable decision and shall conclude at the end of the
16270th calendar day after that date.
17 (a-10) All elections under subsection (a) that are made or
18deemed to be made before July 1, 2019 shall take effect on July
191, 2019. Elections that are made or deemed to be made on or
20after July 1, 2019 shall take effect on the first day of the
21month following the month in which the election is made or
22deemed to be made.
23 (b) As adequate and legal consideration provided under this
24amendatory Act of the 100th General Assembly for making an
25election under paragraph (1) of subsection (a) of this Section,
26the department shall be expressly and irrevocably prohibited

SB2194- 19 -LRB100 12225 RPS 24730 b
1from offering any future increases in income to a Tier 1
2employee who has made an election under paragraph (1) of
3subsection (a) of this Section on the condition of not
4constituting compensation under Section 14-103.10.
5 As adequate and legal consideration provided under this
6amendatory Act of the 100th General Assembly for making an
7election under paragraph (1) of subsection (a) of this Section,
8each Tier 1 employee who has made an election under paragraph
9(1) of subsection (a) of this Section shall receive a
10consideration payment equal to 10% of the contributions made by
11or on behalf of the employee before the effective date of that
12election. The State Comptroller shall pay the consideration
13payment to the Tier 1 employee out of funds appropriated for
14that purpose under Section 1.9 of the State Pension Funds
15Continuing Appropriation Act. The System shall calculate the
16amount of each consideration payment and, by July 1, 2019,
17shall certify to the State Comptroller the amount of the
18consideration payment, together with the name, address, and any
19other available payment information of the Tier 1 employee as
20found in the records of the System. The System shall make
21additional calculations and certifications of consideration
22payments to the State Comptroller as it deems necessary.
23 (c) A Tier 1 employee who makes the election under
24paragraph (2) of subsection (a) of this Section shall not be
25subject to paragraph (1) of subsection (a) of this Section.
26However, each future increase in income offered by a department

SB2194- 20 -LRB100 12225 RPS 24730 b
1under this Article to a Tier 1 employee who has made the
2election under paragraph (2) of subsection (a) of this Section
3shall be offered by the department expressly and irrevocably on
4the condition of not constituting compensation under Section
514-103.10 and that the Tier 1 employee's acceptance of the
6offered future increase in income shall constitute his or her
7agreement to that condition.
8 (d) The System shall make a good faith effort to contact
9each Tier 1 employee subject to this Section. The System shall
10mail information describing the required election to each Tier
111 employee by United States Postal Service mail to his or her
12last known address on file with the System. If the Tier 1
13employee is not responsive to other means of contact, it is
14sufficient for the System to publish the details of any
15required elections on its website or to publish those details
16in a regularly published newsletter or other existing public
17forum.
18 Tier 1 employees who are subject to this Section shall be
19provided with an election packet containing information
20regarding their options, as well as the forms necessary to make
21the required election. Upon request, the System shall offer
22Tier 1 employees an opportunity to receive information from the
23System before making the required election. The information may
24consist of video materials, group presentations, individual
25consultation with a member or authorized representative of the
26System in person or by telephone or other electronic means, or

SB2194- 21 -LRB100 12225 RPS 24730 b
1any combination of those methods. The System shall not provide
2advice or counseling with respect to which election a Tier 1
3employee should make or specific to the legal or tax
4circumstances of or consequences to the Tier 1 employee.
5 The System shall inform Tier 1 employees in the election
6packet required under this subsection that the Tier 1 employee
7may also wish to obtain information and counsel relating to the
8election required under this Section from any other available
9source, including, but not limited to, labor organizations and
10private counsel.
11 In no event shall the System, its staff, or the Board be
12held liable for any information given to a member regarding the
13elections under this Section. The System shall coordinate with
14the Illinois Department of Central Management Services and each
15other retirement system administering an election in
16accordance with this amendatory Act of the 100th General
17Assembly to provide information concerning the impact of the
18election set forth in this Section.
19 (e) Notwithstanding any other provision of law, a
20department under this Article is required to offer each future
21increase in income expressly and irrevocably on the condition
22of not constituting "compensation" under Section 14-103.10 to
23any Tier 1 employee who has made an election under paragraph
24(2) of subsection (a) of this Section. The offer shall also
25provide that the Tier 1 employee's acceptance of the offered
26future increase in income shall constitute his or her agreement

SB2194- 22 -LRB100 12225 RPS 24730 b
1to the condition set forth in this subsection.
2 For purposes of legislative intent, the condition set forth
3in this subsection shall be construed in a manner that ensures
4that the condition is not violated or circumvented through any
5contrivance of any kind.
6 (f) A member's election under this Section is not a
7prohibited election under subdivision (j)(1) of Section 1-119
8of this Code.
9 (g) No provision of this Section shall be interpreted in a
10way that would cause the System to cease to be a qualified plan
11under Section 401(a) of the Internal Revenue Code of 1986. The
12provisions of this Section shall be subject to and implemented
13in a manner that complies with Section 21 of Article V of the
14Illinois Constitution.
15 (h) If an election created by this amendatory Act in any
16other Article of this Code or any change deriving from that
17election is determined to be unconstitutional or otherwise
18invalid by a final unappealable decision of an Illinois court
19or a court of competent jurisdiction, the invalidity of that
20provision shall not in any way affect the validity of this
21Section or the changes deriving from the election required
22under this Section.
23 (40 ILCS 5/14-114) (from Ch. 108 1/2, par. 14-114)
24 (Text of Section WITHOUT the changes made by P.A. 98-599,
25which has been held unconstitutional)

SB2194- 23 -LRB100 12225 RPS 24730 b
1 Sec. 14-114. Automatic increase in retirement annuity.
2 (a) Subject to the provisions of subsections (a-1), any Any
3person receiving a retirement annuity under this Article who
4retires having attained age 60, or who retires before age 60
5having at least 35 years of creditable service, or who retires
6on or after January 1, 2001 at an age which, when added to the
7number of years of his or her creditable service, equals at
8least 85, shall, on January 1 next following the first full
9year of retirement, have the amount of the then fixed and
10payable monthly retirement annuity increased 3%. Any person
11receiving a retirement annuity under this Article who retires
12before attainment of age 60 and with less than (i) 35 years of
13creditable service if retirement is before January 1, 2001, or
14(ii) the number of years of creditable service which, when
15added to the member's age, would equal 85, if retirement is on
16or after January 1, 2001, shall have the amount of the fixed
17and payable retirement annuity increased by 3% on the January 1
18occurring on or next following (1) attainment of age 60, or (2)
19the first anniversary of retirement, whichever occurs later.
20However, for persons who receive the alternative retirement
21annuity under Section 14-110, references in this subsection (a)
22to attainment of age 60 shall be deemed to refer to attainment
23of age 55. For a person receiving early retirement incentives
24under Section 14-108.3 whose retirement annuity began after
25January 1, 1992 pursuant to an extension granted under
26subsection (e) of that Section, the first anniversary of

SB2194- 24 -LRB100 12225 RPS 24730 b
1retirement shall be deemed to be January 1, 1993. For a person
2who retires on or after June 28, 2001 and on or before October
31, 2001, and whose retirement annuity is calculated, in whole
4or in part, under Section 14-110 or subsection (g) or (h) of
5Section 14-108, the first anniversary of retirement shall be
6deemed to be January 1, 2002.
7 On each January 1 following the date of the initial
8increase under this subsection, the employee's monthly
9retirement annuity shall be increased by an additional 3%.
10 Beginning January 1, 1990, and except as provided in
11subsection (a-1), all automatic annual increases payable under
12this Section shall be calculated as a percentage of the total
13annuity payable at the time of the increase, including previous
14increases granted under this Article.
15 (a-1) Notwithstanding any other provision of this Article,
16for a Tier 1 employee who made the election under paragraph (1)
17of subsection (a) of Section 14-106.5:
18 (1) The initial increase in retirement annuity under
19 this Section shall occur on the January 1 occurring either
20 on or after the attainment of age 67 or the fifth
21 anniversary of the annuity start date, whichever is
22 earlier.
23 (2) The amount of each automatic annual increase in
24 retirement annuity or survivors or widow's annuity
25 occurring on or after the effective date of that election
26 shall be calculated as a percentage of the originally

SB2194- 25 -LRB100 12225 RPS 24730 b
1 granted retirement annuity or survivors or widow's
2 annuity, equal to 3% or one-half the annual unadjusted
3 percentage increase (but not less than zero) in the
4 consumer price index-u for the 12 months ending with the
5 September preceding each November 1, whichever is less. If
6 the annual unadjusted percentage change in the consumer
7 price index-u for the 12 months ending with the September
8 preceding each November 1 is zero or there is a decrease,
9 then the annuity shall not be increased.
10 For the purposes of this Section, "consumer price index-u"
11means the index published by the Bureau of Labor Statistics of
12the United States Department of Labor that measures the average
13change in prices of goods and services purchased by all urban
14consumers, United States city average, all items, 1982-84 =
15100. The new amount resulting from each annual adjustment shall
16be determined by the Public Pension Division of the Department
17of Insurance and made available to the board of the retirement
18system by November 1 of each year.
19 (b) The provisions of subsection (a) of this Section shall
20be applicable to an employee only if the employee makes the
21additional contributions required after December 31, 1969 for
22the purpose of the automatic increases for not less than the
23equivalent of one full year. If an employee becomes an
24annuitant before his additional contributions equal one full
25year's contributions based on his salary at the date of
26retirement, the employee may pay the necessary balance of the

SB2194- 26 -LRB100 12225 RPS 24730 b
1contributions to the system, without interest, and be eligible
2for the increasing annuity authorized by this Section.
3 (c) The provisions of subsection (a) of this Section shall
4not be applicable to any annuitant who is on retirement on
5December 31, 1969, and thereafter returns to State service,
6unless the member has established at least one year of
7additional creditable service following reentry into service.
8 (d) In addition to other increases which may be provided by
9this Section, on January 1, 1981 any annuitant who was
10receiving a retirement annuity on or before January 1, 1971
11shall have his retirement annuity then being paid increased $1
12per month for each year of creditable service. On January 1,
131982, any annuitant who began receiving a retirement annuity on
14or before January 1, 1977, shall have his retirement annuity
15then being paid increased $1 per month for each year of
16creditable service.
17 On January 1, 1987, any annuitant who began receiving a
18retirement annuity on or before January 1, 1977, shall have the
19monthly retirement annuity increased by an amount equal to 8
20per year of creditable service times the number of years that
21have elapsed since the annuity began.
22 (e) Every person who receives the alternative retirement
23annuity under Section 14-110 and who is eligible to receive the
243% increase under subsection (a) on January 1, 1986, shall also
25receive on that date a one-time increase in retirement annuity
26equal to the difference between (1) his actual retirement

SB2194- 27 -LRB100 12225 RPS 24730 b
1annuity on that date, including any increases received under
2subsection (a), and (2) the amount of retirement annuity he
3would have received on that date if the amendments to
4subsection (a) made by Public Act 84-162 had been in effect
5since the date of his retirement.
6(Source: P.A. 91-927, eff. 12-14-00; 92-14, eff. 6-28-01;
792-651, eff. 7-11-02.)
8 (40 ILCS 5/14-131)
9 Sec. 14-131. Contributions by State.
10 (a) The State shall make contributions to the System by
11appropriations of amounts which, together with other employer
12contributions from trust, federal, and other funds, employee
13contributions, investment income, and other income, will be
14sufficient to meet the cost of maintaining and administering
15the System on a 90% funded basis in accordance with actuarial
16recommendations.
17 For the purposes of this Section and Section 14-135.08,
18references to State contributions refer only to employer
19contributions and do not include employee contributions that
20are picked up or otherwise paid by the State or a department on
21behalf of the employee.
22 (b) The Board shall determine the total amount of State
23contributions required for each fiscal year on the basis of the
24actuarial tables and other assumptions adopted by the Board,
25using the formula in subsection (e).

SB2194- 28 -LRB100 12225 RPS 24730 b
1 The Board shall also determine a State contribution rate
2for each fiscal year, expressed as a percentage of payroll,
3based on the total required State contribution for that fiscal
4year (less the amount received by the System from
5appropriations under Section 8.12 of the State Finance Act and
6Section 1 of the State Pension Funds Continuing Appropriation
7Act, if any, for the fiscal year ending on the June 30
8immediately preceding the applicable November 15 certification
9deadline), the estimated payroll (including all forms of
10compensation) for personal services rendered by eligible
11employees, and the recommendations of the actuary.
12 For the purposes of this Section and Section 14.1 of the
13State Finance Act, the term "eligible employees" includes
14employees who participate in the System, persons who may elect
15to participate in the System but have not so elected, persons
16who are serving a qualifying period that is required for
17participation, and annuitants employed by a department as
18described in subdivision (a)(1) or (a)(2) of Section 14-111.
19 (c) Contributions shall be made by the several departments
20for each pay period by warrants drawn by the State Comptroller
21against their respective funds or appropriations based upon
22vouchers stating the amount to be so contributed. These amounts
23shall be based on the full rate certified by the Board under
24Section 14-135.08 for that fiscal year. From the effective date
25of this amendatory Act of the 93rd General Assembly through the
26payment of the final payroll from fiscal year 2004

SB2194- 29 -LRB100 12225 RPS 24730 b
1appropriations, the several departments shall not make
2contributions for the remainder of fiscal year 2004 but shall
3instead make payments as required under subsection (a-1) of
4Section 14.1 of the State Finance Act. The several departments
5shall resume those contributions at the commencement of fiscal
6year 2005.
7 (c-1) Notwithstanding subsection (c) of this Section, for
8fiscal years 2010, 2012, 2013, 2014, 2015, 2016, and 2017 only,
9contributions by the several departments are not required to be
10made for General Revenue Funds payrolls processed by the
11Comptroller. Payrolls paid by the several departments from all
12other State funds must continue to be processed pursuant to
13subsection (c) of this Section.
14 (c-2) For State fiscal years 2010, 2012, 2013, 2014, 2015,
152016, and 2017 only, on or as soon as possible after the 15th
16day of each month, the Board shall submit vouchers for payment
17of State contributions to the System, in a total monthly amount
18of one-twelfth of the fiscal year General Revenue Fund
19contribution as certified by the System pursuant to Section
2014-135.08 of the Illinois Pension Code.
21 (d) If an employee is paid from trust funds or federal
22funds, the department or other employer shall pay employer
23contributions from those funds to the System at the certified
24rate, unless the terms of the trust or the federal-State
25agreement preclude the use of the funds for that purpose, in
26which case the required employer contributions shall be paid by

SB2194- 30 -LRB100 12225 RPS 24730 b
1the State. From the effective date of this amendatory Act of
2the 93rd General Assembly through the payment of the final
3payroll from fiscal year 2004 appropriations, the department or
4other employer shall not pay contributions for the remainder of
5fiscal year 2004 but shall instead make payments as required
6under subsection (a-1) of Section 14.1 of the State Finance
7Act. The department or other employer shall resume payment of
8contributions at the commencement of fiscal year 2005.
9 (e) For State fiscal years 2012 through 2045 (except as
10otherwise provided for fiscal year 2020), the minimum
11contribution to the System to be made by the State for each
12fiscal year shall be an amount determined by the System to be
13sufficient to bring the total assets of the System up to 90% of
14the total actuarial liabilities of the System by the end of
15State fiscal year 2045. In making these determinations, the
16required State contribution shall be calculated each year as a
17level percentage of payroll over the years remaining to and
18including fiscal year 2045 and shall be determined under the
19projected unit credit actuarial cost method.
20 For State fiscal year 2020:
21 (1) The initial calculation and certification shall be
22 based on the amount determined above.
23 (2) For purposes of the recertification due on or
24 before May 1, 2019, the recalculation of the required State
25 contribution for fiscal year 2020 shall take into account
26 the effect on the System's liabilities of the elections

SB2194- 31 -LRB100 12225 RPS 24730 b
1 made under Section 14-106.5.
2 (3) For purposes of the recertification due on or
3 before October 1, 2019, the total required State
4 contribution for fiscal year 2020 shall be reduced by the
5 amount of the consideration payments made to Tier 1
6 employees who made the election under paragraph (1) of
7 subsection (a) of Section 14-106.5.
8 For State fiscal years 1996 through 2005, the State
9contribution to the System, as a percentage of the applicable
10employee payroll, shall be increased in equal annual increments
11so that by State fiscal year 2011, the State is contributing at
12the rate required under this Section; except that (i) for State
13fiscal year 1998, for all purposes of this Code and any other
14law of this State, the certified percentage of the applicable
15employee payroll shall be 5.052% for employees earning eligible
16creditable service under Section 14-110 and 6.500% for all
17other employees, notwithstanding any contrary certification
18made under Section 14-135.08 before the effective date of this
19amendatory Act of 1997, and (ii) in the following specified
20State fiscal years, the State contribution to the System shall
21not be less than the following indicated percentages of the
22applicable employee payroll, even if the indicated percentage
23will produce a State contribution in excess of the amount
24otherwise required under this subsection and subsection (a):
259.8% in FY 1999; 10.0% in FY 2000; 10.2% in FY 2001; 10.4% in FY
262002; 10.6% in FY 2003; and 10.8% in FY 2004.

SB2194- 32 -LRB100 12225 RPS 24730 b
1 Notwithstanding any other provision of this Article, the
2total required State contribution to the System for State
3fiscal year 2006 is $203,783,900.
4 Notwithstanding any other provision of this Article, the
5total required State contribution to the System for State
6fiscal year 2007 is $344,164,400.
7 For each of State fiscal years 2008 through 2009, the State
8contribution to the System, as a percentage of the applicable
9employee payroll, shall be increased in equal annual increments
10from the required State contribution for State fiscal year
112007, so that by State fiscal year 2011, the State is
12contributing at the rate otherwise required under this Section.
13 Notwithstanding any other provision of this Article, the
14total required State General Revenue Fund contribution for
15State fiscal year 2010 is $723,703,100 and shall be made from
16the proceeds of bonds sold in fiscal year 2010 pursuant to
17Section 7.2 of the General Obligation Bond Act, less (i) the
18pro rata share of bond sale expenses determined by the System's
19share of total bond proceeds, (ii) any amounts received from
20the General Revenue Fund in fiscal year 2010, and (iii) any
21reduction in bond proceeds due to the issuance of discounted
22bonds, if applicable.
23 Notwithstanding any other provision of this Article, the
24total required State General Revenue Fund contribution for
25State fiscal year 2011 is the amount recertified by the System
26on or before April 1, 2011 pursuant to Section 14-135.08 and

SB2194- 33 -LRB100 12225 RPS 24730 b
1shall be made from the proceeds of bonds sold in fiscal year
22011 pursuant to Section 7.2 of the General Obligation Bond
3Act, less (i) the pro rata share of bond sale expenses
4determined by the System's share of total bond proceeds, (ii)
5any amounts received from the General Revenue Fund in fiscal
6year 2011, and (iii) any reduction in bond proceeds due to the
7issuance of discounted bonds, if applicable.
8 Beginning in State fiscal year 2046, the minimum State
9contribution for each fiscal year shall be the amount needed to
10maintain the total assets of the System at 90% of the total
11actuarial liabilities of the System.
12 Amounts received by the System pursuant to Section 25 of
13the Budget Stabilization Act or Section 8.12 of the State
14Finance Act in any fiscal year do not reduce and do not
15constitute payment of any portion of the minimum State
16contribution required under this Article in that fiscal year.
17Such amounts shall not reduce, and shall not be included in the
18calculation of, the required State contributions under this
19Article in any future year until the System has reached a
20funding ratio of at least 90%. A reference in this Article to
21the "required State contribution" or any substantially similar
22term does not include or apply to any amounts payable to the
23System under Section 25 of the Budget Stabilization Act.
24 Notwithstanding any other provision of this Section, the
25required State contribution for State fiscal year 2005 and for
26fiscal year 2008 and each fiscal year thereafter, as calculated

SB2194- 34 -LRB100 12225 RPS 24730 b
1under this Section and certified under Section 14-135.08, shall
2not exceed an amount equal to (i) the amount of the required
3State contribution that would have been calculated under this
4Section for that fiscal year if the System had not received any
5payments under subsection (d) of Section 7.2 of the General
6Obligation Bond Act, minus (ii) the portion of the State's
7total debt service payments for that fiscal year on the bonds
8issued in fiscal year 2003 for the purposes of that Section
97.2, as determined and certified by the Comptroller, that is
10the same as the System's portion of the total moneys
11distributed under subsection (d) of Section 7.2 of the General
12Obligation Bond Act. In determining this maximum for State
13fiscal years 2008 through 2010, however, the amount referred to
14in item (i) shall be increased, as a percentage of the
15applicable employee payroll, in equal increments calculated
16from the sum of the required State contribution for State
17fiscal year 2007 plus the applicable portion of the State's
18total debt service payments for fiscal year 2007 on the bonds
19issued in fiscal year 2003 for the purposes of Section 7.2 of
20the General Obligation Bond Act, so that, by State fiscal year
212011, the State is contributing at the rate otherwise required
22under this Section.
23 (f) After the submission of all payments for eligible
24employees from personal services line items in fiscal year 2004
25have been made, the Comptroller shall provide to the System a
26certification of the sum of all fiscal year 2004 expenditures

SB2194- 35 -LRB100 12225 RPS 24730 b
1for personal services that would have been covered by payments
2to the System under this Section if the provisions of this
3amendatory Act of the 93rd General Assembly had not been
4enacted. Upon receipt of the certification, the System shall
5determine the amount due to the System based on the full rate
6certified by the Board under Section 14-135.08 for fiscal year
72004 in order to meet the State's obligation under this
8Section. The System shall compare this amount due to the amount
9received by the System in fiscal year 2004 through payments
10under this Section and under Section 6z-61 of the State Finance
11Act. If the amount due is more than the amount received, the
12difference shall be termed the "Fiscal Year 2004 Shortfall" for
13purposes of this Section, and the Fiscal Year 2004 Shortfall
14shall be satisfied under Section 1.2 of the State Pension Funds
15Continuing Appropriation Act. If the amount due is less than
16the amount received, the difference shall be termed the "Fiscal
17Year 2004 Overpayment" for purposes of this Section, and the
18Fiscal Year 2004 Overpayment shall be repaid by the System to
19the Pension Contribution Fund as soon as practicable after the
20certification.
21 (g) For purposes of determining the required State
22contribution to the System, the value of the System's assets
23shall be equal to the actuarial value of the System's assets,
24which shall be calculated as follows:
25 As of June 30, 2008, the actuarial value of the System's
26assets shall be equal to the market value of the assets as of

SB2194- 36 -LRB100 12225 RPS 24730 b
1that date. In determining the actuarial value of the System's
2assets for fiscal years after June 30, 2008, any actuarial
3gains or losses from investment return incurred in a fiscal
4year shall be recognized in equal annual amounts over the
55-year period following that fiscal year.
6 (h) For purposes of determining the required State
7contribution to the System for a particular year, the actuarial
8value of assets shall be assumed to earn a rate of return equal
9to the System's actuarially assumed rate of return.
10 (i) After the submission of all payments for eligible
11employees from personal services line items paid from the
12General Revenue Fund in fiscal year 2010 have been made, the
13Comptroller shall provide to the System a certification of the
14sum of all fiscal year 2010 expenditures for personal services
15that would have been covered by payments to the System under
16this Section if the provisions of this amendatory Act of the
1796th General Assembly had not been enacted. Upon receipt of the
18certification, the System shall determine the amount due to the
19System based on the full rate certified by the Board under
20Section 14-135.08 for fiscal year 2010 in order to meet the
21State's obligation under this Section. The System shall compare
22this amount due to the amount received by the System in fiscal
23year 2010 through payments under this Section. If the amount
24due is more than the amount received, the difference shall be
25termed the "Fiscal Year 2010 Shortfall" for purposes of this
26Section, and the Fiscal Year 2010 Shortfall shall be satisfied

SB2194- 37 -LRB100 12225 RPS 24730 b
1under Section 1.2 of the State Pension Funds Continuing
2Appropriation Act. If the amount due is less than the amount
3received, the difference shall be termed the "Fiscal Year 2010
4Overpayment" for purposes of this Section, and the Fiscal Year
52010 Overpayment shall be repaid by the System to the General
6Revenue Fund as soon as practicable after the certification.
7 (j) After the submission of all payments for eligible
8employees from personal services line items paid from the
9General Revenue Fund in fiscal year 2011 have been made, the
10Comptroller shall provide to the System a certification of the
11sum of all fiscal year 2011 expenditures for personal services
12that would have been covered by payments to the System under
13this Section if the provisions of this amendatory Act of the
1496th General Assembly had not been enacted. Upon receipt of the
15certification, the System shall determine the amount due to the
16System based on the full rate certified by the Board under
17Section 14-135.08 for fiscal year 2011 in order to meet the
18State's obligation under this Section. The System shall compare
19this amount due to the amount received by the System in fiscal
20year 2011 through payments under this Section. If the amount
21due is more than the amount received, the difference shall be
22termed the "Fiscal Year 2011 Shortfall" for purposes of this
23Section, and the Fiscal Year 2011 Shortfall shall be satisfied
24under Section 1.2 of the State Pension Funds Continuing
25Appropriation Act. If the amount due is less than the amount
26received, the difference shall be termed the "Fiscal Year 2011

SB2194- 38 -LRB100 12225 RPS 24730 b
1Overpayment" for purposes of this Section, and the Fiscal Year
22011 Overpayment shall be repaid by the System to the General
3Revenue Fund as soon as practicable after the certification.
4 (k) For fiscal years 2012 through 2017 only, after the
5submission of all payments for eligible employees from personal
6services line items paid from the General Revenue Fund in the
7fiscal year have been made, the Comptroller shall provide to
8the System a certification of the sum of all expenditures in
9the fiscal year for personal services. Upon receipt of the
10certification, the System shall determine the amount due to the
11System based on the full rate certified by the Board under
12Section 14-135.08 for the fiscal year in order to meet the
13State's obligation under this Section. The System shall compare
14this amount due to the amount received by the System for the
15fiscal year. If the amount due is more than the amount
16received, the difference shall be termed the "Prior Fiscal Year
17Shortfall" for purposes of this Section, and the Prior Fiscal
18Year Shortfall shall be satisfied under Section 1.2 of the
19State Pension Funds Continuing Appropriation Act. If the amount
20due is less than the amount received, the difference shall be
21termed the "Prior Fiscal Year Overpayment" for purposes of this
22Section, and the Prior Fiscal Year Overpayment shall be repaid
23by the System to the General Revenue Fund as soon as
24practicable after the certification.
25(Source: P.A. 98-24, eff. 6-19-13; 98-674, eff. 6-30-14; 99-8,
26eff. 7-9-15; 99-523, eff. 6-30-16.)

SB2194- 39 -LRB100 12225 RPS 24730 b
1 (40 ILCS 5/14-133) (from Ch. 108 1/2, par. 14-133)
2 (Text of Section WITHOUT the changes made by P.A. 98-599,
3which has been held unconstitutional)
4 Sec. 14-133. Contributions on behalf of members.
5 (a) Except as provided in subsection (a-5), each Each
6participating employee shall make contributions to the System,
7based on the employee's compensation, as follows:
8 (1) Covered employees, except as indicated below, 3.5%
9 for retirement annuity, and 0.5% for a widow or survivors
10 annuity;
11 (2) Noncovered employees, except as indicated below,
12 7% for retirement annuity and 1% for a widow or survivors
13 annuity;
14 (3) Noncovered employees serving in a position in which
15 "eligible creditable service" as defined in Section 14-110
16 may be earned, 1% for a widow or survivors annuity plus the
17 following amount for retirement annuity: 8.5% through
18 December 31, 2001; 9.5% in 2002; 10.5% in 2003; and 11.5%
19 in 2004 and thereafter;
20 (4) Covered employees serving in a position in which
21 "eligible creditable service" as defined in Section 14-110
22 may be earned, 0.5% for a widow or survivors annuity plus
23 the following amount for retirement annuity: 5% through
24 December 31, 2001; 6% in 2002; 7% in 2003; and 8% in 2004
25 and thereafter;

SB2194- 40 -LRB100 12225 RPS 24730 b
1 (5) Each security employee of the Department of
2 Corrections or of the Department of Human Services who is a
3 covered employee, 0.5% for a widow or survivors annuity
4 plus the following amount for retirement annuity: 5%
5 through December 31, 2001; 6% in 2002; 7% in 2003; and 8%
6 in 2004 and thereafter;
7 (6) Each security employee of the Department of
8 Corrections or of the Department of Human Services who is
9 not a covered employee, 1% for a widow or survivors annuity
10 plus the following amount for retirement annuity: 8.5%
11 through December 31, 2001; 9.5% in 2002; 10.5% in 2003; and
12 11.5% in 2004 and thereafter.
13 (a-5) Beginning July 1, 2019 or the effective date of the
14Tier 1 employee's election under paragraph (1) of subsection
15(a) of Section 14-106.5, whichever is later, in lieu of the
16contributions otherwise required under subsection (a), each
17Tier 1 employee who made the election under paragraph (1) of
18subsection (a) of Section 14-106.5 who is a participating
19employee shall make contributions to the System, based on his
20or her compensation, as follows:
21 (1) Covered employees, except as indicated below,
22 3.15% for retirement annuity, and 0.45% for a widow or
23 survivors annuity;
24 (2) Noncovered employees, except as indicated below,
25 6.3% for retirement annuity and 0.9% for a widow or
26 survivors annuity;

SB2194- 41 -LRB100 12225 RPS 24730 b
1 (3) Noncovered employees serving in a position in which
2 "eligible creditable service" as defined in Section 14-110
3 may be earned, 10.35% for retirement annuity and 0.9% for a
4 widow or survivors annuity;
5 (4) Covered employees serving in a position in which
6 "eligible creditable service" as defined in Section 14-110
7 may be earned, 7.2% for retirement annuity and 0.45% for a
8 widow or survivors annuity;
9 (5) Each security employee of the Department of
10 Corrections or of the Department of Human Services who is a
11 covered employee, 10.8% for retirement annuity and 0.45%
12 for a widow or survivors annuity;
13 (6) Each security employee of the Department of
14 Corrections or of the Department of Human Services who is
15 not a covered employee, 10.35% for retirement annuity and
16 0.9% for a widow or survivors annuity.
17 (b) Contributions shall be in the form of a deduction from
18compensation and shall be made notwithstanding that the
19compensation paid in cash to the employee shall be reduced
20thereby below the minimum prescribed by law or regulation. Each
21member is deemed to consent and agree to the deductions from
22compensation provided for in this Article, and shall receipt in
23full for salary or compensation.
24(Source: P.A. 92-14, eff. 6-28-01.)
25 (40 ILCS 5/14-135.08) (from Ch. 108 1/2, par. 14-135.08)

SB2194- 42 -LRB100 12225 RPS 24730 b
1 (Text of Section WITHOUT the changes made by P.A. 98-599,
2which has been held unconstitutional)
3 Sec. 14-135.08. To certify required State contributions.
4 (a) To certify to the Governor and to each department, on
5or before November 15 of each year until November 15, 2011, the
6required rate for State contributions to the System for the
7next State fiscal year, as determined under subsection (b) of
8Section 14-131. The certification to the Governor under this
9subsection (a) shall include a copy of the actuarial
10recommendations upon which the rate is based and shall
11specifically identify the System's projected State normal cost
12for that fiscal year.
13 (a-5) On or before November 1 of each year, beginning
14November 1, 2012, the Board shall submit to the State Actuary,
15the Governor, and the General Assembly a proposed certification
16of the amount of the required State contribution to the System
17for the next fiscal year, along with all of the actuarial
18assumptions, calculations, and data upon which that proposed
19certification is based. On or before January 1 of each year
20beginning January 1, 2013, the State Actuary shall issue a
21preliminary report concerning the proposed certification and
22identifying, if necessary, recommended changes in actuarial
23assumptions that the Board must consider before finalizing its
24certification of the required State contributions. On or before
25January 15, 2013 and each January 15 thereafter, the Board
26shall certify to the Governor and the General Assembly the

SB2194- 43 -LRB100 12225 RPS 24730 b
1amount of the required State contribution for the next fiscal
2year. The Board's certification must note any deviations from
3the State Actuary's recommended changes, the reason or reasons
4for not following the State Actuary's recommended changes, and
5the fiscal impact of not following the State Actuary's
6recommended changes on the required State contribution.
7 (b) The certifications under subsections (a) and (a-5)
8shall include an additional amount necessary to pay all
9principal of and interest on those general obligation bonds due
10the next fiscal year authorized by Section 7.2(a) of the
11General Obligation Bond Act and issued to provide the proceeds
12deposited by the State with the System in July 2003,
13representing deposits other than amounts reserved under
14Section 7.2(c) of the General Obligation Bond Act. For State
15fiscal year 2005, the Board shall make a supplemental
16certification of the additional amount necessary to pay all
17principal of and interest on those general obligation bonds due
18in State fiscal years 2004 and 2005 authorized by Section
197.2(a) of the General Obligation Bond Act and issued to provide
20the proceeds deposited by the State with the System in July
212003, representing deposits other than amounts reserved under
22Section 7.2(c) of the General Obligation Bond Act, as soon as
23practical after the effective date of this amendatory Act of
24the 93rd General Assembly.
25 On or before May 1, 2004, the Board shall recalculate and
26recertify to the Governor and to each department the amount of

SB2194- 44 -LRB100 12225 RPS 24730 b
1the required State contribution to the System and the required
2rates for State contributions to the System for State fiscal
3year 2005, taking into account the amounts appropriated to and
4received by the System under subsection (d) of Section 7.2 of
5the General Obligation Bond Act.
6 On or before July 1, 2005, the Board shall recalculate and
7recertify to the Governor and to each department the amount of
8the required State contribution to the System and the required
9rates for State contributions to the System for State fiscal
10year 2006, taking into account the changes in required State
11contributions made by this amendatory Act of the 94th General
12Assembly.
13 On or before April 1, 2011, the Board shall recalculate and
14recertify to the Governor and to each department the amount of
15the required State contribution to the System for State fiscal
16year 2011, applying the changes made by Public Act 96-889 to
17the System's assets and liabilities as of June 30, 2009 as
18though Public Act 96-889 was approved on that date.
19 On or before May 1, 2019, the Board shall recalculate and
20recertify to the Governor and the General Assembly the amount
21of the required State contribution to the System for State
22fiscal year 2020, taking into account the effect on the
23System's liabilities of the elections made under Section
2414-106.5.
25 On or before October 1, 2019, the Board shall recalculate
26and recertify to the Governor and the General Assembly the

SB2194- 45 -LRB100 12225 RPS 24730 b
1amount of the required State contribution to the System for
2State fiscal year 2020, taking into account the reduction
3specified under item (3) of subsection (e) of Section 14-131.
4(Source: P.A. 96-1497, eff. 1-14-11; 96-1511, eff. 1-27-11;
597-694, eff. 6-18-12.)
6 (40 ILCS 5/14-152.1)
7 (Text of Section WITHOUT the changes made by P.A. 98-599,
8which has been held unconstitutional)
9 Sec. 14-152.1. Application and expiration of new benefit
10increases.
11 (a) As used in this Section, "new benefit increase" means
12an increase in the amount of any benefit provided under this
13Article, or an expansion of the conditions of eligibility for
14any benefit under this Article, that results from an amendment
15to this Code that takes effect after June 1, 2005 (the
16effective date of Public Act 94-4). "New benefit increase",
17however, does not include any benefit increase resulting from
18the changes made to this Article by Public Act 96-37 or by this
19amendatory Act of the 100th General Assembly this amendatory
20Act of the 96th General Assembly.
21 (b) Notwithstanding any other provision of this Code or any
22subsequent amendment to this Code, every new benefit increase
23is subject to this Section and shall be deemed to be granted
24only in conformance with and contingent upon compliance with
25the provisions of this Section.

SB2194- 46 -LRB100 12225 RPS 24730 b
1 (c) The Public Act enacting a new benefit increase must
2identify and provide for payment to the System of additional
3funding at least sufficient to fund the resulting annual
4increase in cost to the System as it accrues.
5 Every new benefit increase is contingent upon the General
6Assembly providing the additional funding required under this
7subsection. The Commission on Government Forecasting and
8Accountability shall analyze whether adequate additional
9funding has been provided for the new benefit increase and
10shall report its analysis to the Public Pension Division of the
11Department of Insurance Financial and Professional Regulation.
12A new benefit increase created by a Public Act that does not
13include the additional funding required under this subsection
14is null and void. If the Public Pension Division determines
15that the additional funding provided for a new benefit increase
16under this subsection is or has become inadequate, it may so
17certify to the Governor and the State Comptroller and, in the
18absence of corrective action by the General Assembly, the new
19benefit increase shall expire at the end of the fiscal year in
20which the certification is made.
21 (d) Every new benefit increase shall expire 5 years after
22its effective date or on such earlier date as may be specified
23in the language enacting the new benefit increase or provided
24under subsection (c). This does not prevent the General
25Assembly from extending or re-creating a new benefit increase
26by law.

SB2194- 47 -LRB100 12225 RPS 24730 b
1 (e) Except as otherwise provided in the language creating
2the new benefit increase, a new benefit increase that expires
3under this Section continues to apply to persons who applied
4and qualified for the affected benefit while the new benefit
5increase was in effect and to the affected beneficiaries and
6alternate payees of such persons, but does not apply to any
7other person, including without limitation a person who
8continues in service after the expiration date and did not
9apply and qualify for the affected benefit while the new
10benefit increase was in effect.
11(Source: P.A. 96-37, eff. 7-13-09.)
12 (40 ILCS 5/15-108.1)
13 Sec. 15-108.1. Tier 1 member; Tier 1 employee.
14 "Tier 1 member": A participant or an annuitant of a
15retirement annuity under this Article, other than a participant
16in the self-managed plan under Section 15-158.2, who first
17became a participant or member before January 1, 2011 under any
18reciprocal retirement system or pension fund established under
19this Code, other than a retirement system or pension fund
20established under Articles 2, 3, 4, 5, 6, or 18 of this Code.
21"Tier 1 member" includes a person who first became a
22participant under this System before January 1, 2011 and who
23accepts a refund and is subsequently reemployed by an employer
24on or after January 1, 2011.
25 "Tier 1 employee": A Tier 1 member who is a participating

SB2194- 48 -LRB100 12225 RPS 24730 b
1employee, unless he or she is a disability benefit recipient
2under Section 15-150. However, for the purposes of the election
3under Section 15-132.9, "Tier 1 employee" does not include an
4individual who has made an irrevocable election on or before
5June 1, 2017 to retire from service pursuant to the terms of an
6employment contract or a collective bargaining agreement in
7effect on June 1, 2017, excluding any extension, amendment, or
8renewal of that agreement on or after that date, and has
9notified the System of that election.
10(Source: P.A. 98-92, eff. 7-16-13.)
11 (40 ILCS 5/15-111) (from Ch. 108 1/2, par. 15-111)
12 Sec. 15-111. Earnings.
13 (a) "Earnings": Subject to Section 15-111.5, an amount paid
14for personal services equal to the sum of the basic
15compensation plus extra compensation for summer teaching,
16overtime or other extra service. For periods for which an
17employee receives service credit under subsection (c) of
18Section 15-113.1 or Section 15-113.2, earnings are equal to the
19basic compensation on which contributions are paid by the
20employee during such periods. Compensation for employment
21which is irregular, intermittent and temporary shall not be
22considered earnings, unless the participant is also receiving
23earnings from the employer as an employee under Section 15-107.
24 With respect to transition pay paid by the University of
25Illinois to a person who was a participating employee employed

SB2194- 49 -LRB100 12225 RPS 24730 b
1in the fire department of the University of Illinois's
2Champaign-Urbana campus immediately prior to the elimination
3of that fire department:
4 (1) "Earnings" includes transition pay paid to the
5 employee on or after the effective date of this amendatory
6 Act of the 91st General Assembly.
7 (2) "Earnings" includes transition pay paid to the
8 employee before the effective date of this amendatory Act
9 of the 91st General Assembly only if (i) employee
10 contributions under Section 15-157 have been withheld from
11 that transition pay or (ii) the employee pays to the System
12 before January 1, 2001 an amount representing employee
13 contributions under Section 15-157 on that transition pay.
14 Employee contributions under item (ii) may be paid in a
15 lump sum, by withholding from additional transition pay
16 accruing before January 1, 2001, or in any other manner
17 approved by the System. Upon payment of the employee
18 contributions on transition pay, the corresponding
19 employer contributions become an obligation of the State.
20 (a-5) Notwithstanding any other provision of this Section,
21"earnings" does not include any future increase in income that
22is offered for service by an employer to a Tier 1 employee
23under this Article pursuant to the condition set forth in
24subsection (c) of Section 15-132.9 and accepted under that
25condition by a Tier 1 employee who has made the election under
26paragraph (2) of subsection (a) of Section 15-132.9.

SB2194- 50 -LRB100 12225 RPS 24730 b
1 (a-10) Notwithstanding any other provision of this
2Section, "earnings" does not include any consideration payment
3made to a Tier 1 employee.
4 (b) For a Tier 2 member, the annual earnings shall not
5exceed $106,800; however, that amount shall annually
6thereafter be increased by the lesser of (i) 3% of that amount,
7including all previous adjustments, or (ii) one half the annual
8unadjusted percentage increase (but not less than zero) in the
9consumer price index-u for the 12 months ending with the
10September preceding each November 1, including all previous
11adjustments.
12 For the purposes of this Section, "consumer price index u"
13means the index published by the Bureau of Labor Statistics of
14the United States Department of Labor that measures the average
15change in prices of goods and services purchased by all urban
16consumers, United States city average, all items, 1982-84 =
17100. The new amount resulting from each annual adjustment shall
18be determined by the Public Pension Division of the Department
19of Insurance and made available to the boards of the retirement
20systems and pension funds by November 1 of each year.
21 (c) With each submission of payroll information in the
22manner prescribed by the System, the employer shall certify
23that the payroll information is correct and complies with all
24applicable State and federal laws.
25(Source: P.A. 98-92, eff. 7-16-13; 99-897, eff. 1-1-17.)

SB2194- 51 -LRB100 12225 RPS 24730 b
1 (40 ILCS 5/15-112.1 new)
2 Sec. 15-112.1. Future increase in income. "Future increase
3in income" means an increase to a Tier 1 employee's base pay
4that is offered by an employer to the Tier 1 employee for
5service under this Article after June 30, 2018 that qualifies
6as "earnings", as defined in Section 15-111, or would qualify
7as "earnings" but for the fact that it was offered to and
8accepted by the Tier 1 employee under the condition set forth
9in subsection (c) of Section 15-132.9. The term "future
10increase in income" includes an increase to a Tier 1 employee's
11base pay that is paid to the Tier 1 employee pursuant to an
12extension, amendment, or renewal of any such employment
13contract or collective bargaining agreement after the
14effective date of this Section.
15 (40 ILCS 5/15-112.2 new)
16 Sec. 15-112.2. Base pay. As used in Section 15-112.1 of
17this Code, "base pay" means the greater of either (i) the Tier
181 employee's annualized rate of earnings as of June 30, 2018,
19or (ii) the Tier 1 employee's annualized rate of earnings
20immediately preceding the expiration, renewal, or amendment of
21an employment contract or collective bargaining agreement in
22effect on the effective date of this Section. For a person
23returning to participating employee status as a Tier 1 employee
24after June 30, 2018, however, "base pay" means the employee's
25annualized rate of earnings as of the employee's last date of

SB2194- 52 -LRB100 12225 RPS 24730 b
1service prior to July 1, 2018. The System shall calculate the
2base pay of each Tier 1 employee pursuant to this Section.
3 (40 ILCS 5/15-132.9 new)
4 Sec. 15-132.9. Election by Tier 1 employees.
5 (a) Each Tier 1 employee shall make an irrevocable election
6either:
7 (1) to agree to delay his or her eligibility for
8 automatic annual increases in retirement annuity as
9 provided in subsection (d-1) of Section 15-136 and to have
10 the amount of the automatic annual increases in his or her
11 retirement annuity and survivor annuity that are otherwise
12 provided for in this Article calculated, instead, as
13 provided in subsection (d-1) of Section 15-136; or
14 (2) to not agree to the provisions of paragraph (1) of
15 this subsection.
16 The election required under this subsection (a) shall be
17made by each Tier 1 employee no earlier than January 1, 2018
18and no later than March 31, 2018, except that:
19 (i) a person who becomes a Tier 1 employee under this
20 Article on or after January 1, 2018 must make the election
21 under this subsection (a) within 60 days after becoming a
22 Tier 1 employee;
23 (ii) a person who returns to participating employee
24 status as a Tier 1 employee under this Article on or after
25 January 1, 2018 and has not yet made an election under this

SB2194- 53 -LRB100 12225 RPS 24730 b
1 Section must make the election under this subsection (a)
2 within 60 days after returning to participating employee
3 status as a Tier 1 employee; and
4 (iii) a person who returns to participating employee
5 status as a Tier 1 employee under this Article but who has
6 not made an election under Section 15-134.5 must make the
7 election under this subsection (a) at the same time as the
8 election under Section 15-134.5 and within the timeframes
9 required by that Section.
10 If a Tier 1 employee fails for any reason to make a
11required election under this subsection within the time
12specified, then the employee shall be deemed to have made the
13election under paragraph (2) of this subsection.
14 (a-5) If this Section is enjoined or stayed by an Illinois
15court or a court of competent jurisdiction pending the entry of
16a final and unappealable decision, and this Section is
17determined to be constitutional or otherwise valid by a final
18unappealable decision of an Illinois court or a court of
19competent jurisdiction, then the election procedure set forth
20in subsection (a) of this Section shall commence on the 180th
21calendar day after the date of the issuance of the final
22unappealable decision and shall conclude at the end of the
23270th calendar day after that date.
24 (a-10) All elections under subsection (a) that are made or
25deemed to be made before July 1, 2018 shall take effect on July
261, 2018. Elections that are made or deemed to be made on or

SB2194- 54 -LRB100 12225 RPS 24730 b
1after July 1, 2018 shall take effect on the first day of the
2month following the month in which the election is made or
3deemed to be made.
4 (b) As adequate and legal consideration provided under this
5amendatory Act of the 100th General Assembly for making an
6election under paragraph (1) of subsection (a) of this Section,
7the employer shall be expressly and irrevocably prohibited from
8offering any future increases in income to a Tier 1 employee
9who has made an election under paragraph (1) of subsection (a)
10of this Section on the condition of not constituting earnings
11under Section 15-111.
12 As adequate and legal consideration provided under this
13amendatory Act of the 100th General Assembly for making an
14election under paragraph (1) of subsection (a) of this Section,
15each Tier 1 employee who has made an election under paragraph
16(1) of subsection (a) of this Section shall receive a
17consideration payment equal to 10% of the contributions made by
18or on behalf of the employee under Section 15-157 before the
19effective date of that election. The State Comptroller shall
20pay the consideration payment to the Tier 1 employee out of
21funds appropriated for that purpose under Section 1.9 of the
22State Pension Funds Continuing Appropriation Act. The System
23shall calculate the amount of each consideration payment and,
24by July 1, 2018, shall certify to the State Comptroller the
25amount of the consideration payment, together with the name,
26address, and any other available payment information of the

SB2194- 55 -LRB100 12225 RPS 24730 b
1Tier 1 employee as found in the records of the System. The
2System shall make additional calculations and certifications
3of consideration payments to the State Comptroller as the
4System deems necessary.
5 (c) A Tier 1 employee who makes the election under
6paragraph (2) of subsection (a) of this Section shall not be
7subject to paragraph (1) of subsection (a) of this Section.
8However, each future increase in income offered by an employer
9under this Article to a Tier 1 employee who has made the
10election under paragraph (2) of subsection (a) of this Section
11shall be offered by the employer expressly and irrevocably on
12the condition of not constituting earnings under Section 15-111
13and that the Tier 1 employee's acceptance of the offered future
14increase in income shall constitute his or her agreement to
15that condition.
16 (d) The System shall make a good faith effort to contact
17each Tier 1 employee subject to this Section. The System shall
18mail information describing the required election to each Tier
191 employee by United States Postal Service mail to his or her
20last known address on file with the System. If the Tier 1
21employee is not responsive to other means of contact, it is
22sufficient for the System to publish the details of any
23required elections on its website or to publish those details
24in a regularly published newsletter or other existing public
25forum.
26 Tier 1 employees who are subject to this Section shall be

SB2194- 56 -LRB100 12225 RPS 24730 b
1provided with an election packet containing information
2regarding their options, as well as the forms necessary to make
3the required election. Upon request, the System shall offer
4Tier 1 employees an opportunity to receive information from the
5System before making the required election. The information may
6consist of video materials, benefit estimators, group
7presentations, individual consultation with a member or
8authorized representative of the System in person or by
9telephone or other electronic means, or any combination of
10these methods. The System shall not provide advice or
11counseling with respect to which election a Tier 1 employee
12should make or specific to the legal or tax circumstances of or
13consequences to the Tier 1 employee.
14 The System shall inform Tier 1 employees in the election
15packet required under this subsection that the Tier 1 employee
16may also wish to obtain information and counsel relating to the
17election required under this Section from any other available
18source, including, but not limited to, labor organizations and
19private counsel.
20 In no event shall the System, its staff, or the Board be
21held liable for any information given to a member regarding the
22elections under this Section. The System shall coordinate with
23the Illinois Department of Central Management Services and each
24other retirement system administering an election in
25accordance with this amendatory Act of the 100th General
26Assembly to provide information concerning the impact of the

SB2194- 57 -LRB100 12225 RPS 24730 b
1election set forth in this Section.
2 (e) Notwithstanding any other provision of law, an employer
3under this Article is required to offer each future increase in
4income expressly and irrevocably on the condition of not
5constituting "earnings" under Section 15-111 to any Tier 1
6employee who has made an election under paragraph (2) of
7subsection (a) of this Section. The offer shall also provide
8that the Tier 1 employee's acceptance of the offered future
9increase in income shall constitute his or her agreement to the
10condition set forth in this subsection.
11 For purposes of legislative intent, the condition set forth
12in this subsection shall be construed in a manner that ensures
13that the condition is not violated or circumvented through any
14contrivance of any kind.
15 (f) A member's election under this Section is not a
16prohibited election under subdivision (j)(1) of Section 1-119
17of this Code.
18 (g) No provision of this Section shall be interpreted in a
19way that would cause the System to cease to be a qualified plan
20under Section 401(a) of the Internal Revenue Code of 1986.
21 (h) If an election created by this amendatory Act in any
22other Article of this Code or any change deriving from that
23election is determined to be unconstitutional or otherwise
24invalid by a final unappealable decision of an Illinois court
25or a court of competent jurisdiction, the invalidity of that
26provision shall not in any way affect the validity of this

SB2194- 58 -LRB100 12225 RPS 24730 b
1Section or the changes deriving from the election required
2under this Section.
3 (40 ILCS 5/15-136) (from Ch. 108 1/2, par. 15-136)
4 (Text of Section WITHOUT the changes made by P.A. 98-599,
5which has been held unconstitutional)
6 Sec. 15-136. Retirement annuities - Amount. The provisions
7of this Section 15-136 apply only to those participants who are
8participating in the traditional benefit package or the
9portable benefit package and do not apply to participants who
10are participating in the self-managed plan.
11 (a) The amount of a participant's retirement annuity,
12expressed in the form of a single-life annuity, shall be
13determined by whichever of the following rules is applicable
14and provides the largest annuity:
15 Rule 1: The retirement annuity shall be 1.67% of final rate
16of earnings for each of the first 10 years of service, 1.90%
17for each of the next 10 years of service, 2.10% for each year
18of service in excess of 20 but not exceeding 30, and 2.30% for
19each year in excess of 30; or for persons who retire on or
20after January 1, 1998, 2.2% of the final rate of earnings for
21each year of service.
22 Rule 2: The retirement annuity shall be the sum of the
23following, determined from amounts credited to the participant
24in accordance with the actuarial tables and the effective rate
25of interest in effect at the time the retirement annuity

SB2194- 59 -LRB100 12225 RPS 24730 b
1begins:
2 (i) the normal annuity which can be provided on an
3 actuarially equivalent basis, by the accumulated normal
4 contributions as of the date the annuity begins;
5 (ii) an annuity from employer contributions of an
6 amount equal to that which can be provided on an
7 actuarially equivalent basis from the accumulated normal
8 contributions made by the participant under Section
9 15-113.6 and Section 15-113.7 plus 1.4 times all other
10 accumulated normal contributions made by the participant;
11 and
12 (iii) the annuity that can be provided on an
13 actuarially equivalent basis from the entire contribution
14 made by the participant under Section 15-113.3.
15 With respect to a police officer or firefighter who retires
16on or after August 14, 1998, the accumulated normal
17contributions taken into account under clauses (i) and (ii) of
18this Rule 2 shall include the additional normal contributions
19made by the police officer or firefighter under Section
2015-157(a).
21 The amount of a retirement annuity calculated under this
22Rule 2 shall be computed solely on the basis of the
23participant's accumulated normal contributions, as specified
24in this Rule and defined in Section 15-116. Neither an employee
25or employer contribution for early retirement under Section
2615-136.2 nor any other employer contribution shall be used in

SB2194- 60 -LRB100 12225 RPS 24730 b
1the calculation of the amount of a retirement annuity under
2this Rule 2.
3 This amendatory Act of the 91st General Assembly is a
4clarification of existing law and applies to every participant
5and annuitant without regard to whether status as an employee
6terminates before the effective date of this amendatory Act.
7 This Rule 2 does not apply to a person who first becomes an
8employee under this Article on or after July 1, 2005.
9 Rule 3: The retirement annuity of a participant who is
10employed at least one-half time during the period on which his
11or her final rate of earnings is based, shall be equal to the
12participant's years of service not to exceed 30, multiplied by
13(1) $96 if the participant's final rate of earnings is less
14than $3,500, (2) $108 if the final rate of earnings is at least
15$3,500 but less than $4,500, (3) $120 if the final rate of
16earnings is at least $4,500 but less than $5,500, (4) $132 if
17the final rate of earnings is at least $5,500 but less than
18$6,500, (5) $144 if the final rate of earnings is at least
19$6,500 but less than $7,500, (6) $156 if the final rate of
20earnings is at least $7,500 but less than $8,500, (7) $168 if
21the final rate of earnings is at least $8,500 but less than
22$9,500, and (8) $180 if the final rate of earnings is $9,500 or
23more, except that the annuity for those persons having made an
24election under Section 15-154(a-1) shall be calculated and
25payable under the portable retirement benefit program pursuant
26to the provisions of Section 15-136.4.

SB2194- 61 -LRB100 12225 RPS 24730 b
1 Rule 4: A participant who is at least age 50 and has 25 or
2more years of service as a police officer or firefighter, and a
3participant who is age 55 or over and has at least 20 but less
4than 25 years of service as a police officer or firefighter,
5shall be entitled to a retirement annuity of 2 1/4% of the
6final rate of earnings for each of the first 10 years of
7service as a police officer or firefighter, 2 1/2% for each of
8the next 10 years of service as a police officer or
9firefighter, and 2 3/4% for each year of service as a police
10officer or firefighter in excess of 20. The retirement annuity
11for all other service shall be computed under Rule 1. A Tier 2
12member is eligible for a retirement annuity calculated under
13Rule 4 only if that Tier 2 member meets the service
14requirements for that benefit calculation as prescribed under
15this Rule 4 in addition to the applicable age requirement under
16subsection (a-5) of Section 15-135.
17 For purposes of this Rule 4, a participant's service as a
18firefighter shall also include the following:
19 (i) service that is performed while the person is an
20 employee under subsection (h) of Section 15-107; and
21 (ii) in the case of an individual who was a
22 participating employee employed in the fire department of
23 the University of Illinois's Champaign-Urbana campus
24 immediately prior to the elimination of that fire
25 department and who immediately after the elimination of
26 that fire department transferred to another job with the

SB2194- 62 -LRB100 12225 RPS 24730 b
1 University of Illinois, service performed as an employee of
2 the University of Illinois in a position other than police
3 officer or firefighter, from the date of that transfer
4 until the employee's next termination of service with the
5 University of Illinois.
6 (b) For a Tier 1 member, the retirement annuity provided
7under Rules 1 and 3 above shall be reduced by 1/2 of 1% for each
8month the participant is under age 60 at the time of
9retirement. However, this reduction shall not apply in the
10following cases:
11 (1) For a disabled participant whose disability
12 benefits have been discontinued because he or she has
13 exhausted eligibility for disability benefits under clause
14 (6) of Section 15-152;
15 (2) For a participant who has at least the number of
16 years of service required to retire at any age under
17 subsection (a) of Section 15-135; or
18 (3) For that portion of a retirement annuity which has
19 been provided on account of service of the participant
20 during periods when he or she performed the duties of a
21 police officer or firefighter, if these duties were
22 performed for at least 5 years immediately preceding the
23 date the retirement annuity is to begin.
24 (b-5) The retirement annuity of a Tier 2 member who is
25retiring after attaining age 62 with at least 10 years of
26service credit shall be reduced by 1/2 of 1% for each full

SB2194- 63 -LRB100 12225 RPS 24730 b
1month that the member's age is under age 67.
2 (c) The maximum retirement annuity provided under Rules 1,
32, 4, and 5 shall be the lesser of (1) the annual limit of
4benefits as specified in Section 415 of the Internal Revenue
5Code of 1986, as such Section may be amended from time to time
6and as such benefit limits shall be adjusted by the
7Commissioner of Internal Revenue, and (2) 80% of final rate of
8earnings.
9 (d) Subject to the provisions of subsection (d-1), a A Tier
101 member whose status as an employee terminates after August
1114, 1969 shall receive automatic increases in his or her
12retirement annuity as follows:
13 Effective January 1 immediately following the date the
14retirement annuity begins, the annuitant shall receive an
15increase in his or her monthly retirement annuity of 0.125% of
16the monthly retirement annuity provided under Rule 1, Rule 2,
17Rule 3, or Rule 4 contained in this Section, multiplied by the
18number of full months which elapsed from the date the
19retirement annuity payments began to January 1, 1972, plus
200.1667% of such annuity, multiplied by the number of full
21months which elapsed from January 1, 1972, or the date the
22retirement annuity payments began, whichever is later, to
23January 1, 1978, plus 0.25% of such annuity multiplied by the
24number of full months which elapsed from January 1, 1978, or
25the date the retirement annuity payments began, whichever is
26later, to the effective date of the increase.

SB2194- 64 -LRB100 12225 RPS 24730 b
1 The annuitant shall receive an increase in his or her
2monthly retirement annuity on each January 1 thereafter during
3the annuitant's life of 3% of the monthly annuity provided
4under Rule 1, Rule 2, Rule 3, or Rule 4 contained in this
5Section. The change made under this subsection by P.A. 81-970
6is effective January 1, 1980 and applies to each annuitant
7whose status as an employee terminates before or after that
8date.
9 Beginning January 1, 1990, and except as provided in
10subsection (d-1), all automatic annual increases payable under
11this Section shall be calculated as a percentage of the total
12annuity payable at the time of the increase, including all
13increases previously granted under this Article.
14 The change made in this subsection by P.A. 85-1008 is
15effective January 26, 1988, and is applicable without regard to
16whether status as an employee terminated before that date.
17 (d-1) Notwithstanding any other provision of this Article,
18for a Tier 1 employee who made the election under paragraph (1)
19of subsection (a) of Section 15-132.9:
20 (1) The initial increase in retirement annuity under
21 this Section shall occur on the January 1 occurring either
22 on or after the attainment of age 67 or the fifth
23 anniversary of the annuity start date, whichever is
24 earlier.
25 (2) The amount of each automatic annual increase in
26 retirement annuity or survivor annuity occurring on or

SB2194- 65 -LRB100 12225 RPS 24730 b
1 after the effective date of that election shall be
2 calculated as a percentage of the originally granted
3 retirement annuity or survivor annuity, equal to 3% or
4 one-half the annual unadjusted percentage increase (but
5 not less than zero) in the consumer price index-u for the
6 12 months ending with the September preceding each November
7 1, whichever is less. If the annual unadjusted percentage
8 change in the consumer price index-u for the 12 months
9 ending with the September preceding each November 1 is zero
10 or there is a decrease, then the annuity shall not be
11 increased.
12 For the purposes of this Section, "consumer price index-u"
13means the index published by the Bureau of Labor Statistics of
14the United States Department of Labor that measures the average
15change in prices of goods and services purchased by all urban
16consumers, United States city average, all items, 1982-84 =
17100. The new amount resulting from each annual adjustment shall
18be determined by the Public Pension Division of the Department
19of Insurance and made available to the board of the retirement
20system by November 1 of each year.
21 (d-5) A retirement annuity of a Tier 2 member shall receive
22annual increases on the January 1 occurring either on or after
23the attainment of age 67 or the first anniversary of the
24annuity start date, whichever is later. Each annual increase
25shall be calculated at 3% or one half the annual unadjusted
26percentage increase (but not less than zero) in the consumer

SB2194- 66 -LRB100 12225 RPS 24730 b
1price index-u for the 12 months ending with the September
2preceding each November 1, whichever is less, of the originally
3granted retirement annuity. If the annual unadjusted
4percentage change in the consumer price index-u for the 12
5months ending with the September preceding each November 1 is
6zero or there is a decrease, then the annuity shall not be
7increased.
8 (e) If, on January 1, 1987, or the date the retirement
9annuity payment period begins, whichever is later, the sum of
10the retirement annuity provided under Rule 1 or Rule 2 of this
11Section and the automatic annual increases provided under the
12preceding subsection or Section 15-136.1, amounts to less than
13the retirement annuity which would be provided by Rule 3, the
14retirement annuity shall be increased as of January 1, 1987, or
15the date the retirement annuity payment period begins,
16whichever is later, to the amount which would be provided by
17Rule 3 of this Section. Such increased amount shall be
18considered as the retirement annuity in determining benefits
19provided under other Sections of this Article. This paragraph
20applies without regard to whether status as an employee
21terminated before the effective date of this amendatory Act of
221987, provided that the annuitant was employed at least
23one-half time during the period on which the final rate of
24earnings was based.
25 (f) A participant is entitled to such additional annuity as
26may be provided on an actuarially equivalent basis, by any

SB2194- 67 -LRB100 12225 RPS 24730 b
1accumulated additional contributions to his or her credit.
2However, the additional contributions made by the participant
3toward the automatic increases in annuity provided under this
4Section shall not be taken into account in determining the
5amount of such additional annuity.
6 (g) If, (1) by law, a function of a governmental unit, as
7defined by Section 20-107 of this Code, is transferred in whole
8or in part to an employer, and (2) a participant transfers
9employment from such governmental unit to such employer within
106 months after the transfer of the function, and (3) the sum of
11(A) the annuity payable to the participant under Rule 1, 2, or
123 of this Section (B) all proportional annuities payable to the
13participant by all other retirement systems covered by Article
1420, and (C) the initial primary insurance amount to which the
15participant is entitled under the Social Security Act, is less
16than the retirement annuity which would have been payable if
17all of the participant's pension credits validated under
18Section 20-109 had been validated under this system, a
19supplemental annuity equal to the difference in such amounts
20shall be payable to the participant.
21 (h) On January 1, 1981, an annuitant who was receiving a
22retirement annuity on or before January 1, 1971 shall have his
23or her retirement annuity then being paid increased $1 per
24month for each year of creditable service. On January 1, 1982,
25an annuitant whose retirement annuity began on or before
26January 1, 1977, shall have his or her retirement annuity then

SB2194- 68 -LRB100 12225 RPS 24730 b
1being paid increased $1 per month for each year of creditable
2service.
3 (i) On January 1, 1987, any annuitant whose retirement
4annuity began on or before January 1, 1977, shall have the
5monthly retirement annuity increased by an amount equal to 8
6per year of creditable service times the number of years that
7have elapsed since the annuity began.
8(Source: P.A. 97-933, eff. 8-10-12; 97-968, eff. 8-16-12;
998-92, eff. 7-16-13.)
10 (40 ILCS 5/15-155) (from Ch. 108 1/2, par. 15-155)
11 Sec. 15-155. Employer contributions.
12 (a) The State of Illinois shall make contributions by
13appropriations of amounts which, together with the other
14employer contributions from trust, federal, and other funds,
15employee contributions, income from investments, and other
16income of this System, will be sufficient to meet the cost of
17maintaining and administering the System on a 90% funded basis
18in accordance with actuarial recommendations.
19 The Board shall determine the amount of State contributions
20required for each fiscal year on the basis of the actuarial
21tables and other assumptions adopted by the Board and the
22recommendations of the actuary, using the formula in subsection
23(a-1).
24 (a-1) For State fiscal years 2012 through 2045 (except as
25otherwise provided for fiscal year 2019), the minimum

SB2194- 69 -LRB100 12225 RPS 24730 b
1contribution to the System to be made by the State for each
2fiscal year shall be an amount determined by the System to be
3sufficient to bring the total assets of the System up to 90% of
4the total actuarial liabilities of the System by the end of
5State fiscal year 2045. In making these determinations, the
6required State contribution shall be calculated each year as a
7level percentage of payroll over the years remaining to and
8including fiscal year 2045 and shall be determined under the
9projected unit credit actuarial cost method.
10 For State fiscal year 2019:
11 (1) The initial calculation and certification shall be
12 based on the amount determined above.
13 (2) For purposes of the recertification due on or
14 before May 1, 2018, the recalculation of the required State
15 contribution for fiscal year 2019 shall take into account
16 the effect on the System's liabilities of the elections
17 made under Section 15-132.9.
18 (3) For purposes of the recertification due on or
19 before October 1, 2018, the total required State
20 contribution for fiscal year 2019 shall be reduced by the
21 amount of the consideration payments made to Tier 1
22 employees who made the election under paragraph (1) of
23 subsection (a) of Section 15-132.9.
24 For State fiscal years 1996 through 2005, the State
25contribution to the System, as a percentage of the applicable
26employee payroll, shall be increased in equal annual increments

SB2194- 70 -LRB100 12225 RPS 24730 b
1so that by State fiscal year 2011, the State is contributing at
2the rate required under this Section.
3 Notwithstanding any other provision of this Article, the
4total required State contribution for State fiscal year 2006 is
5$166,641,900.
6 Notwithstanding any other provision of this Article, the
7total required State contribution for State fiscal year 2007 is
8$252,064,100.
9 For each of State fiscal years 2008 through 2009, the State
10contribution to the System, as a percentage of the applicable
11employee payroll, shall be increased in equal annual increments
12from the required State contribution for State fiscal year
132007, so that by State fiscal year 2011, the State is
14contributing at the rate otherwise required under this Section.
15 Notwithstanding any other provision of this Article, the
16total required State contribution for State fiscal year 2010 is
17$702,514,000 and shall be made from the State Pensions Fund and
18proceeds of bonds sold in fiscal year 2010 pursuant to Section
197.2 of the General Obligation Bond Act, less (i) the pro rata
20share of bond sale expenses determined by the System's share of
21total bond proceeds, (ii) any amounts received from the General
22Revenue Fund in fiscal year 2010, (iii) any reduction in bond
23proceeds due to the issuance of discounted bonds, if
24applicable.
25 Notwithstanding any other provision of this Article, the
26total required State contribution for State fiscal year 2011 is

SB2194- 71 -LRB100 12225 RPS 24730 b
1the amount recertified by the System on or before April 1, 2011
2pursuant to Section 15-165 and shall be made from the State
3Pensions Fund and proceeds of bonds sold in fiscal year 2011
4pursuant to Section 7.2 of the General Obligation Bond Act,
5less (i) the pro rata share of bond sale expenses determined by
6the System's share of total bond proceeds, (ii) any amounts
7received from the General Revenue Fund in fiscal year 2011, and
8(iii) any reduction in bond proceeds due to the issuance of
9discounted bonds, if applicable.
10 Beginning in State fiscal year 2046, the minimum State
11contribution for each fiscal year shall be the amount needed to
12maintain the total assets of the System at 90% of the total
13actuarial liabilities of the System.
14 Amounts received by the System pursuant to Section 25 of
15the Budget Stabilization Act or Section 8.12 of the State
16Finance Act in any fiscal year do not reduce and do not
17constitute payment of any portion of the minimum State
18contribution required under this Article in that fiscal year.
19Such amounts shall not reduce, and shall not be included in the
20calculation of, the required State contributions under this
21Article in any future year until the System has reached a
22funding ratio of at least 90%. A reference in this Article to
23the "required State contribution" or any substantially similar
24term does not include or apply to any amounts payable to the
25System under Section 25 of the Budget Stabilization Act.
26 Notwithstanding any other provision of this Section, the

SB2194- 72 -LRB100 12225 RPS 24730 b
1required State contribution for State fiscal year 2005 and for
2fiscal year 2008 and each fiscal year thereafter, as calculated
3under this Section and certified under Section 15-165, shall
4not exceed an amount equal to (i) the amount of the required
5State contribution that would have been calculated under this
6Section for that fiscal year if the System had not received any
7payments under subsection (d) of Section 7.2 of the General
8Obligation Bond Act, minus (ii) the portion of the State's
9total debt service payments for that fiscal year on the bonds
10issued in fiscal year 2003 for the purposes of that Section
117.2, as determined and certified by the Comptroller, that is
12the same as the System's portion of the total moneys
13distributed under subsection (d) of Section 7.2 of the General
14Obligation Bond Act. In determining this maximum for State
15fiscal years 2008 through 2010, however, the amount referred to
16in item (i) shall be increased, as a percentage of the
17applicable employee payroll, in equal increments calculated
18from the sum of the required State contribution for State
19fiscal year 2007 plus the applicable portion of the State's
20total debt service payments for fiscal year 2007 on the bonds
21issued in fiscal year 2003 for the purposes of Section 7.2 of
22the General Obligation Bond Act, so that, by State fiscal year
232011, the State is contributing at the rate otherwise required
24under this Section.
25 (b) If an employee is paid from trust or federal funds, the
26employer shall pay to the Board contributions from those funds

SB2194- 73 -LRB100 12225 RPS 24730 b
1which are sufficient to cover the accruing normal costs on
2behalf of the employee. However, universities having employees
3who are compensated out of local auxiliary funds, income funds,
4or service enterprise funds are not required to pay such
5contributions on behalf of those employees. The local auxiliary
6funds, income funds, and service enterprise funds of
7universities shall not be considered trust funds for the
8purpose of this Article, but funds of alumni associations,
9foundations, and athletic associations which are affiliated
10with the universities included as employers under this Article
11and other employers which do not receive State appropriations
12are considered to be trust funds for the purpose of this
13Article.
14 (b-1) The City of Urbana and the City of Champaign shall
15each make employer contributions to this System for their
16respective firefighter employees who participate in this
17System pursuant to subsection (h) of Section 15-107. The rate
18of contributions to be made by those municipalities shall be
19determined annually by the Board on the basis of the actuarial
20assumptions adopted by the Board and the recommendations of the
21actuary, and shall be expressed as a percentage of salary for
22each such employee. The Board shall certify the rate to the
23affected municipalities as soon as may be practical. The
24employer contributions required under this subsection shall be
25remitted by the municipality to the System at the same time and
26in the same manner as employee contributions.

SB2194- 74 -LRB100 12225 RPS 24730 b
1 (c) Through State fiscal year 1995: The total employer
2contribution shall be apportioned among the various funds of
3the State and other employers, whether trust, federal, or other
4funds, in accordance with actuarial procedures approved by the
5Board. State of Illinois contributions for employers receiving
6State appropriations for personal services shall be payable
7from appropriations made to the employers or to the System. The
8contributions for Class I community colleges covering earnings
9other than those paid from trust and federal funds, shall be
10payable solely from appropriations to the Illinois Community
11College Board or the System for employer contributions.
12 (d) Beginning in State fiscal year 1996, the required State
13contributions to the System shall be appropriated directly to
14the System and shall be payable through vouchers issued in
15accordance with subsection (c) of Section 15-165, except as
16provided in subsection (g).
17 (e) The State Comptroller shall draw warrants payable to
18the System upon proper certification by the System or by the
19employer in accordance with the appropriation laws and this
20Code.
21 (f) Normal costs under this Section means liability for
22pensions and other benefits which accrues to the System because
23of the credits earned for service rendered by the participants
24during the fiscal year and expenses of administering the
25System, but shall not include the principal of or any
26redemption premium or interest on any bonds issued by the Board

SB2194- 75 -LRB100 12225 RPS 24730 b
1or any expenses incurred or deposits required in connection
2therewith.
3 (g) If the amount of a participant's earnings for any
4academic year used to determine the final rate of earnings,
5determined on a full-time equivalent basis, exceeds the amount
6of his or her earnings with the same employer for the previous
7academic year, determined on a full-time equivalent basis, by
8more than 6%, the participant's employer shall pay to the
9System, in addition to all other payments required under this
10Section and in accordance with guidelines established by the
11System, the present value of the increase in benefits resulting
12from the portion of the increase in earnings that is in excess
13of 6%. This present value shall be computed by the System on
14the basis of the actuarial assumptions and tables used in the
15most recent actuarial valuation of the System that is available
16at the time of the computation. The System may require the
17employer to provide any pertinent information or
18documentation.
19 Whenever it determines that a payment is or may be required
20under this subsection (g), the System shall calculate the
21amount of the payment and bill the employer for that amount.
22The bill shall specify the calculations used to determine the
23amount due. If the employer disputes the amount of the bill, it
24may, within 30 days after receipt of the bill, apply to the
25System in writing for a recalculation. The application must
26specify in detail the grounds of the dispute and, if the

SB2194- 76 -LRB100 12225 RPS 24730 b
1employer asserts that the calculation is subject to subsection
2(h) or (i) of this Section, must include an affidavit setting
3forth and attesting to all facts within the employer's
4knowledge that are pertinent to the applicability of subsection
5(h) or (i). Upon receiving a timely application for
6recalculation, the System shall review the application and, if
7appropriate, recalculate the amount due.
8 The employer contributions required under this subsection
9(g) may be paid in the form of a lump sum within 90 days after
10receipt of the bill. If the employer contributions are not paid
11within 90 days after receipt of the bill, then interest will be
12charged at a rate equal to the System's annual actuarially
13assumed rate of return on investment compounded annually from
14the 91st day after receipt of the bill. Payments must be
15concluded within 3 years after the employer's receipt of the
16bill.
17 When assessing payment for any amount due under this
18subsection (g), the System shall include earnings, to the
19extent not established by a participant under Section 15-113.11
20or 15-113.12, that would have been paid to the participant had
21the participant not taken (i) periods of voluntary or
22involuntary furlough occurring on or after July 1, 2015 and on
23or before June 30, 2017 or (ii) periods of voluntary pay
24reduction in lieu of furlough occurring on or after July 1,
252015 and on or before June 30, 2017. Determining earnings that
26would have been paid to a participant had the participant not

SB2194- 77 -LRB100 12225 RPS 24730 b
1taken periods of voluntary or involuntary furlough or periods
2of voluntary pay reduction shall be the responsibility of the
3employer, and shall be reported in a manner prescribed by the
4System.
5 (h) This subsection (h) applies only to payments made or
6salary increases given on or after June 1, 2005 but before July
71, 2011. The changes made by Public Act 94-1057 shall not
8require the System to refund any payments received before July
931, 2006 (the effective date of Public Act 94-1057).
10 When assessing payment for any amount due under subsection
11(g), the System shall exclude earnings increases paid to
12participants under contracts or collective bargaining
13agreements entered into, amended, or renewed before June 1,
142005.
15 When assessing payment for any amount due under subsection
16(g), the System shall exclude earnings increases paid to a
17participant at a time when the participant is 10 or more years
18from retirement eligibility under Section 15-135.
19 When assessing payment for any amount due under subsection
20(g), the System shall exclude earnings increases resulting from
21overload work, including a contract for summer teaching, or
22overtime when the employer has certified to the System, and the
23System has approved the certification, that: (i) in the case of
24overloads (A) the overload work is for the sole purpose of
25academic instruction in excess of the standard number of
26instruction hours for a full-time employee occurring during the

SB2194- 78 -LRB100 12225 RPS 24730 b
1academic year that the overload is paid and (B) the earnings
2increases are equal to or less than the rate of pay for
3academic instruction computed using the participant's current
4salary rate and work schedule; and (ii) in the case of
5overtime, the overtime was necessary for the educational
6mission.
7 When assessing payment for any amount due under subsection
8(g), the System shall exclude any earnings increase resulting
9from (i) a promotion for which the employee moves from one
10classification to a higher classification under the State
11Universities Civil Service System, (ii) a promotion in academic
12rank for a tenured or tenure-track faculty position, or (iii) a
13promotion that the Illinois Community College Board has
14recommended in accordance with subsection (k) of this Section.
15These earnings increases shall be excluded only if the
16promotion is to a position that has existed and been filled by
17a member for no less than one complete academic year and the
18earnings increase as a result of the promotion is an increase
19that results in an amount no greater than the average salary
20paid for other similar positions.
21 (i) When assessing payment for any amount due under
22subsection (g), the System shall exclude any salary increase
23described in subsection (h) of this Section given on or after
24July 1, 2011 but before July 1, 2014 under a contract or
25collective bargaining agreement entered into, amended, or
26renewed on or after June 1, 2005 but before July 1, 2011.

SB2194- 79 -LRB100 12225 RPS 24730 b
1Notwithstanding any other provision of this Section, any
2payments made or salary increases given after June 30, 2014
3shall be used in assessing payment for any amount due under
4subsection (g) of this Section.
5 (j) The System shall prepare a report and file copies of
6the report with the Governor and the General Assembly by
7January 1, 2007 that contains all of the following information:
8 (1) The number of recalculations required by the
9 changes made to this Section by Public Act 94-1057 for each
10 employer.
11 (2) The dollar amount by which each employer's
12 contribution to the System was changed due to
13 recalculations required by Public Act 94-1057.
14 (3) The total amount the System received from each
15 employer as a result of the changes made to this Section by
16 Public Act 94-4.
17 (4) The increase in the required State contribution
18 resulting from the changes made to this Section by Public
19 Act 94-1057.
20 (k) The Illinois Community College Board shall adopt rules
21for recommending lists of promotional positions submitted to
22the Board by community colleges and for reviewing the
23promotional lists on an annual basis. When recommending
24promotional lists, the Board shall consider the similarity of
25the positions submitted to those positions recognized for State
26universities by the State Universities Civil Service System.

SB2194- 80 -LRB100 12225 RPS 24730 b
1The Illinois Community College Board shall file a copy of its
2findings with the System. The System shall consider the
3findings of the Illinois Community College Board when making
4determinations under this Section. The System shall not exclude
5any earnings increases resulting from a promotion when the
6promotion was not submitted by a community college. Nothing in
7this subsection (k) shall require any community college to
8submit any information to the Community College Board.
9 (l) For purposes of determining the required State
10contribution to the System, the value of the System's assets
11shall be equal to the actuarial value of the System's assets,
12which shall be calculated as follows:
13 As of June 30, 2008, the actuarial value of the System's
14assets shall be equal to the market value of the assets as of
15that date. In determining the actuarial value of the System's
16assets for fiscal years after June 30, 2008, any actuarial
17gains or losses from investment return incurred in a fiscal
18year shall be recognized in equal annual amounts over the
195-year period following that fiscal year.
20 (m) For purposes of determining the required State
21contribution to the system for a particular year, the actuarial
22value of assets shall be assumed to earn a rate of return equal
23to the system's actuarially assumed rate of return.
24 (n) If Section 15-132.9 is determined to be
25unconstitutional or otherwise invalid by a final unappealable
26decision of an Illinois court or a court of competent

SB2194- 81 -LRB100 12225 RPS 24730 b
1jurisdiction, then the changes made to this Section by this
2amendatory Act of the 100th General Assembly shall not take
3effect and are repealed by operation of law.
4(Source: P.A. 98-92, eff. 7-16-13; 98-463, eff. 8-16-13;
599-897, eff. 1-1-17.)
6 (40 ILCS 5/15-157) (from Ch. 108 1/2, par. 15-157)
7 Sec. 15-157. Employee Contributions.
8 (a) Each participating employee shall make contributions
9towards the retirement benefits payable under the retirement
10program applicable to the employee from each payment of
11earnings applicable to employment under this system on and
12after the date of becoming a participant as follows: Prior to
13September 1, 1949, 3 1/2% of earnings; from September 1, 1949
14to August 31, 1955, 5%; from September 1, 1955 to August 31,
151969, 6%; from September 1, 1969, 6 1/2%. These contributions
16are to be considered as normal contributions for purposes of
17this Article.
18 Each participant who is a police officer or firefighter
19shall make normal contributions of 8% of each payment of
20earnings applicable to employment as a police officer or
21firefighter under this system on or after September 1, 1981,
22unless he or she files with the board within 60 days after the
23effective date of this amendatory Act of 1991 or 60 days after
24the board receives notice that he or she is employed as a
25police officer or firefighter, whichever is later, a written

SB2194- 82 -LRB100 12225 RPS 24730 b
1notice waiving the retirement formula provided by Rule 4 of
2Section 15-136. This waiver shall be irrevocable. If a
3participant had met the conditions set forth in Section
415-132.1 prior to the effective date of this amendatory Act of
51991 but failed to make the additional normal contributions
6required by this paragraph, he or she may elect to pay the
7additional contributions plus compound interest at the
8effective rate. If such payment is received by the board, the
9service shall be considered as police officer service in
10calculating the retirement annuity under Rule 4 of Section
1115-136. While performing service described in clause (i) or
12(ii) of Rule 4 of Section 15-136, a participating employee
13shall be deemed to be employed as a firefighter for the purpose
14of determining the rate of employee contributions under this
15Section.
16 (b) Starting September 1, 1969, each participating
17employee shall make additional contributions of 1/2 of 1% of
18earnings to finance a portion of the cost of the annual
19increases in retirement annuity provided under Section 15-136,
20except that with respect to participants in the self-managed
21plan this additional contribution shall be used to finance the
22benefits obtained under that retirement program. Beginning
23July 1, 2018 or the effective date of the Tier 1 employee's
24election under paragraph (1) of subsection (a) of Section
2515-132.9, whichever is later, each Tier 1 employee who made the
26election under paragraph (1) of subsection (a) of Section

SB2194- 83 -LRB100 12225 RPS 24730 b
115-132.9 is no longer required to make contributions under this
2subsection.
3 (c) Except as provided in subsection (c-5), in In addition
4to the amounts described in subsections (a) and (b) of this
5Section, each participating employee shall make contributions
6of 1% of earnings applicable under this system on and after
7August 1, 1959. The contributions made under this subsection
8(c) shall be considered as survivor's insurance contributions
9for purposes of this Article if the employee is covered under
10the traditional benefit package, and such contributions shall
11be considered as additional contributions for purposes of this
12Article if the employee is participating in the self-managed
13plan or has elected to participate in the portable benefit
14package and has completed the applicable one-year waiting
15period. Contributions in excess of $80 during any fiscal year
16beginning before August 31, 1969 and in excess of $120 during
17any fiscal year thereafter until September 1, 1971 shall be
18considered as additional contributions for purposes of this
19Article.
20 (c-5) Beginning July 1, 2018 or the effective date of the
21Tier 1 employee's election under paragraph (1) of subsection
22(a) of Section 15-132.9, whichever is later, in lieu of the
23contributions otherwise required under subsection (c), each
24Tier 1 employee who made the election under paragraph (1) of
25subsection (a) of Section 15-132.9 shall make contributions of
260.7% of earnings applicable under this System and each Tier 1

SB2194- 84 -LRB100 12225 RPS 24730 b
1employee who is a police officer or firefighter who makes
2normal contributions of 8% of each payment of earnings
3applicable to employment as a police officer or firefighter
4under this System and who made the election under paragraph (1)
5of subsection (a) of Section 15-132.9 shall make contributions
6of 0.55% of earnings applicable under this System. The
7contributions made under this subsection (c-5) shall be
8considered as survivor's insurance contributions for purposes
9of this Article and such contributions shall be considered as
10additional contributions for purposes of this Article if the
11employee has elected to participate in the portable benefit
12package and has completed the applicable one-year waiting
13period.
14 (d) If the board by board rule so permits and subject to
15such conditions and limitations as may be specified in its
16rules, a participant may make other additional contributions of
17such percentage of earnings or amounts as the participant shall
18elect in a written notice thereof received by the board.
19 (e) That fraction of a participant's total accumulated
20normal contributions, the numerator of which is equal to the
21number of years of service in excess of that which is required
22to qualify for the maximum retirement annuity, and the
23denominator of which is equal to the total service of the
24participant, shall be considered as accumulated additional
25contributions. The determination of the applicable maximum
26annuity and the adjustment in contributions required by this

SB2194- 85 -LRB100 12225 RPS 24730 b
1provision shall be made as of the date of the participant's
2retirement.
3 (f) Notwithstanding the foregoing, a participating
4employee shall not be required to make contributions under this
5Section after the date upon which continuance of such
6contributions would otherwise cause his or her retirement
7annuity to exceed the maximum retirement annuity as specified
8in clause (1) of subsection (c) of Section 15-136.
9 (g) A participant may make contributions for the purchase
10of service credit under this Article; however, only a
11participating employee may make optional contributions under
12subsection (b) of Section 15-157.1 of this Article.
13 (h) A Tier 2 member shall not make contributions on
14earnings that exceed the limitation as prescribed under
15subsection (b) of Section 15-111 of this Article.
16(Source: P.A. 98-92, eff. 7-16-13; 99-450, eff. 8-24-15.)
17 (40 ILCS 5/15-165) (from Ch. 108 1/2, par. 15-165)
18 (Text of Section WITHOUT the changes made by P.A. 98-599,
19which has been held unconstitutional)
20 Sec. 15-165. To certify amounts and submit vouchers.
21 (a) The Board shall certify to the Governor on or before
22November 15 of each year until November 15, 2011 the
23appropriation required from State funds for the purposes of
24this System for the following fiscal year. The certification
25under this subsection (a) shall include a copy of the actuarial

SB2194- 86 -LRB100 12225 RPS 24730 b
1recommendations upon which it is based and shall specifically
2identify the System's projected State normal cost for that
3fiscal year and the projected State cost for the self-managed
4plan for that fiscal year.
5 On or before May 1, 2004, the Board shall recalculate and
6recertify to the Governor the amount of the required State
7contribution to the System for State fiscal year 2005, taking
8into account the amounts appropriated to and received by the
9System under subsection (d) of Section 7.2 of the General
10Obligation Bond Act.
11 On or before July 1, 2005, the Board shall recalculate and
12recertify to the Governor the amount of the required State
13contribution to the System for State fiscal year 2006, taking
14into account the changes in required State contributions made
15by this amendatory Act of the 94th General Assembly.
16 On or before April 1, 2011, the Board shall recalculate and
17recertify to the Governor the amount of the required State
18contribution to the System for State fiscal year 2011, applying
19the changes made by Public Act 96-889 to the System's assets
20and liabilities as of June 30, 2009 as though Public Act 96-889
21was approved on that date.
22 (a-5) On or before November 1 of each year, beginning
23November 1, 2012, the Board shall submit to the State Actuary,
24the Governor, and the General Assembly a proposed certification
25of the amount of the required State contribution to the System
26for the next fiscal year, along with all of the actuarial

SB2194- 87 -LRB100 12225 RPS 24730 b
1assumptions, calculations, and data upon which that proposed
2certification is based. On or before January 1 of each year,
3beginning January 1, 2013, the State Actuary shall issue a
4preliminary report concerning the proposed certification and
5identifying, if necessary, recommended changes in actuarial
6assumptions that the Board must consider before finalizing its
7certification of the required State contributions. On or before
8January 15, 2013 and each January 15 thereafter, the Board
9shall certify to the Governor and the General Assembly the
10amount of the required State contribution for the next fiscal
11year. The Board's certification must note, in a written
12response to the State Actuary, any deviations from the State
13Actuary's recommended changes, the reason or reasons for not
14following the State Actuary's recommended changes, and the
15fiscal impact of not following the State Actuary's recommended
16changes on the required State contribution.
17 (a-10) On or before May 1, 2018, the Board shall
18recalculate and recertify to the Governor and the General
19Assembly the amount of the required State contribution to the
20System for State fiscal year 2019, taking into account the
21effect on the System's liabilities of the elections made under
22Section 15-132.9.
23 On or before October 1, 2018, the Board shall recalculate
24and recertify to the Governor and the General Assembly the
25amount of the required State contribution to the System for
26State fiscal year 2019, taking into account the reduction

SB2194- 88 -LRB100 12225 RPS 24730 b
1specified under item (3) of subsection (a-1) of Section 15-155.
2 (b) The Board shall certify to the State Comptroller or
3employer, as the case may be, from time to time, by its
4chairperson and secretary, with its seal attached, the amounts
5payable to the System from the various funds.
6 (c) Beginning in State fiscal year 1996, on or as soon as
7possible after the 15th day of each month the Board shall
8submit vouchers for payment of State contributions to the
9System, in a total monthly amount of one-twelfth of the
10required annual State contribution certified under subsection
11(a). From the effective date of this amendatory Act of the 93rd
12General Assembly through June 30, 2004, the Board shall not
13submit vouchers for the remainder of fiscal year 2004 in excess
14of the fiscal year 2004 certified contribution amount
15determined under this Section after taking into consideration
16the transfer to the System under subsection (b) of Section
176z-61 of the State Finance Act. These vouchers shall be paid by
18the State Comptroller and Treasurer by warrants drawn on the
19funds appropriated to the System for that fiscal year.
20 If in any month the amount remaining unexpended from all
21other appropriations to the System for the applicable fiscal
22year (including the appropriations to the System under Section
238.12 of the State Finance Act and Section 1 of the State
24Pension Funds Continuing Appropriation Act) is less than the
25amount lawfully vouchered under this Section, the difference
26shall be paid from the General Revenue Fund under the

SB2194- 89 -LRB100 12225 RPS 24730 b
1continuing appropriation authority provided in Section 1.1 of
2the State Pension Funds Continuing Appropriation Act.
3 (d) So long as the payments received are the full amount
4lawfully vouchered under this Section, payments received by the
5System under this Section shall be applied first toward the
6employer contribution to the self-managed plan established
7under Section 15-158.2. Payments shall be applied second toward
8the employer's portion of the normal costs of the System, as
9defined in subsection (f) of Section 15-155. The balance shall
10be applied toward the unfunded actuarial liabilities of the
11System.
12 (e) In the event that the System does not receive, as a
13result of legislative enactment or otherwise, payments
14sufficient to fully fund the employer contribution to the
15self-managed plan established under Section 15-158.2 and to
16fully fund that portion of the employer's portion of the normal
17costs of the System, as calculated in accordance with Section
1815-155(a-1), then any payments received shall be applied
19proportionately to the optional retirement program established
20under Section 15-158.2 and to the employer's portion of the
21normal costs of the System, as calculated in accordance with
22Section 15-155(a-1).
23(Source: P.A. 97-694, eff. 6-18-12; 98-92, eff. 7-16-13.)
24 (40 ILCS 5/15-198)
25 (Text of Section WITHOUT the changes made by P.A. 98-599,

SB2194- 90 -LRB100 12225 RPS 24730 b
1which has been held unconstitutional)
2 Sec. 15-198. Application and expiration of new benefit
3increases.
4 (a) As used in this Section, "new benefit increase" means
5an increase in the amount of any benefit provided under this
6Article, or an expansion of the conditions of eligibility for
7any benefit under this Article, that results from an amendment
8to this Code that takes effect after the effective date of this
9amendatory Act of the 94th General Assembly. "New benefit
10increase", however, does not include any benefit increase
11resulting from the changes made to this Article by this
12amendatory Act of the 100th General Assembly.
13 (b) Notwithstanding any other provision of this Code or any
14subsequent amendment to this Code, every new benefit increase
15is subject to this Section and shall be deemed to be granted
16only in conformance with and contingent upon compliance with
17the provisions of this Section.
18 (c) The Public Act enacting a new benefit increase must
19identify and provide for payment to the System of additional
20funding at least sufficient to fund the resulting annual
21increase in cost to the System as it accrues.
22 Every new benefit increase is contingent upon the General
23Assembly providing the additional funding required under this
24subsection. The Commission on Government Forecasting and
25Accountability shall analyze whether adequate additional
26funding has been provided for the new benefit increase and

SB2194- 91 -LRB100 12225 RPS 24730 b
1shall report its analysis to the Public Pension Division of the
2Department of Insurance Financial and Professional Regulation.
3A new benefit increase created by a Public Act that does not
4include the additional funding required under this subsection
5is null and void. If the Public Pension Division determines
6that the additional funding provided for a new benefit increase
7under this subsection is or has become inadequate, it may so
8certify to the Governor and the State Comptroller and, in the
9absence of corrective action by the General Assembly, the new
10benefit increase shall expire at the end of the fiscal year in
11which the certification is made.
12 (d) Every new benefit increase shall expire 5 years after
13its effective date or on such earlier date as may be specified
14in the language enacting the new benefit increase or provided
15under subsection (c). This does not prevent the General
16Assembly from extending or re-creating a new benefit increase
17by law.
18 (e) Except as otherwise provided in the language creating
19the new benefit increase, a new benefit increase that expires
20under this Section continues to apply to persons who applied
21and qualified for the affected benefit while the new benefit
22increase was in effect and to the affected beneficiaries and
23alternate payees of such persons, but does not apply to any
24other person, including without limitation a person who
25continues in service after the expiration date and did not
26apply and qualify for the affected benefit while the new

SB2194- 92 -LRB100 12225 RPS 24730 b
1benefit increase was in effect.
2(Source: P.A. 94-4, eff. 6-1-05.)
3 (40 ILCS 5/16-107.1 new)
4 Sec. 16-107.1. Tier 1 employee. "Tier 1 employee": A
5teacher under this Article who first became a member or
6participant before January 1, 2011 under any reciprocal
7retirement system or pension fund established under this Code
8other than a retirement system or pension fund established
9under Article 2, 3, 4, 5, 6, or 18 of this Code. However, for
10the purposes of the election under Section 16-122.9, "Tier 1
11employee" does not include a teacher under this Article who
12would qualify as a Tier 1 employee but who has made an
13irrevocable election on or before June 1, 2017 to retire from
14service pursuant to the terms of an employment contract or a
15collective bargaining agreement in effect on June 1, 2017,
16excluding any extension, amendment, or renewal of that
17agreement after that date, and has notified the System of that
18election.
19 (40 ILCS 5/16-121) (from Ch. 108 1/2, par. 16-121)
20 (Text of Section WITHOUT the changes made by P.A. 98-599,
21which has been held unconstitutional)
22 Sec. 16-121. Salary. "Salary": The actual compensation
23received by a teacher during any school year and recognized by
24the system in accordance with rules of the board. For purposes

SB2194- 93 -LRB100 12225 RPS 24730 b
1of this Section, "school year" includes the regular school term
2plus any additional period for which a teacher is compensated
3and such compensation is recognized by the rules of the board.
4 Notwithstanding any other provision of this Section,
5"salary" does not include any future increase in income that is
6offered by an employer for service as a Tier 1 employee under
7this Article pursuant to the condition set forth in subsection
8(c) of Section 16-122.9 and accepted under that condition by a
9Tier 1 employee who has made the election under paragraph (2)
10of subsection (a) of Section 16-122.9.
11 Notwithstanding any other provision of this Section,
12"salary" does not include any consideration payment made to a
13Tier 1 employee.
14(Source: P.A. 84-1028.)
15 (40 ILCS 5/16-121.1 new)
16 Sec. 16-121.1. Future increase in income. "Future increase
17in income" means an increase to a Tier 1 employee's base pay
18that is offered by an employer to the Tier 1 employee for
19service under this Article after June 30, 2018 that qualifies
20as "salary", as defined in Section 16-121, or would qualify as
21"salary" but for the fact that it was offered to and accepted
22by the Tier 1 employee under the condition set forth in
23subsection (c) of Section 16-122.9. The term "future increase
24in income" includes an increase to a Tier 1 employee's base pay
25that is paid to the Tier 1 employee pursuant to an extension,

SB2194- 94 -LRB100 12225 RPS 24730 b
1amendment, or renewal of any such employment contract or
2collective bargaining agreement after the effective date of
3this Section.
4 (40 ILCS 5/16-121.2 new)
5 Sec. 16-121.2. Base pay. As used in Section 16-121.1 of
6this Code, "base pay" means the greater of either (i) the Tier
71 employee's annualized rate of salary as of June 30, 2018, or
8(ii) the Tier 1 employee's annualized rate of salary
9immediately preceding the expiration, renewal, or amendment of
10an employment contract or collective bargaining agreement in
11effect on the effective date of this Section. For a person
12returning to active service as a Tier 1 employee after June 30,
132018, however, "base pay" means the employee's annualized rate
14of salary as of the employee's last date of service prior to
15July 1, 2018. The System shall calculate the base pay of each
16Tier 1 employee pursuant to this Section.
17 (40 ILCS 5/16-122.9 new)
18 Sec. 16-122.9. Election by Tier 1 employees.
19 (a) Each active Tier 1 employee shall make an irrevocable
20election either:
21 (1) to agree to delay his or her eligibility for
22 automatic annual increases in retirement annuity as
23 provided in subsection (a-1) of Section 16-133.1 or
24 subsection (b-1) of Section 16-136.1, whichever is

SB2194- 95 -LRB100 12225 RPS 24730 b
1 applicable, and to have the amount of the automatic annual
2 increases in his or her retirement annuity and survivor
3 benefit that are otherwise provided for in this Article
4 calculated, instead, as provided in subsection (a-1) of
5 Section 16-133.1 or subsection (b-1) of Section 16-136.1,
6 whichever is applicable; or
7 (2) to not agree to paragraph (1) of this subsection.
8 The election required under this subsection (a) shall be
9made by each active Tier 1 employee no earlier than January 1,
102018 and no later than March 31, 2018, except that:
11 (i) a person who becomes a Tier 1 employee under this
12 Article on or after February 1, 2018 must make the election
13 under this subsection (a) within 60 days after becoming a
14 Tier 1 employee; and
15 (ii) a person who returns to active service as a Tier 1
16 employee under this Article on or after February 1, 2018
17 and has not yet made an election under this Section must
18 make the election under this subsection (a) within 60 days
19 after returning to active service as a Tier 1 employee.
20 If a Tier 1 employee fails for any reason to make a
21required election under this subsection within the time
22specified, then the employee shall be deemed to have made the
23election under paragraph (2) of this subsection.
24 (a-5) If this Section is enjoined or stayed by an Illinois
25court or a court of competent jurisdiction pending the entry of
26a final and unappealable decision, and this Section is

SB2194- 96 -LRB100 12225 RPS 24730 b
1determined to be constitutional or otherwise valid by a final
2unappealable decision of an Illinois court or a court of
3competent jurisdiction, then the election procedure set forth
4in subsection (a) of this Section shall commence on the 180th
5calendar day after the date of the issuance of the final
6unappealable decision and shall conclude at the end of the
7270th calendar day after that date.
8 (a-10) All elections under subsection (a) that are made or
9deemed to be made before July 1, 2018 shall take effect on July
101, 2018. Elections that are made or deemed to be made on or
11after July 1, 2018 shall take effect on the first day of the
12month following the month in which the election is made or
13deemed to be made.
14 (b) As adequate and legal consideration provided under this
15amendatory Act of the 100th General Assembly for making an
16election under paragraph (1) of subsection (a) of this Section,
17an employer shall be expressly and irrevocably prohibited from
18offering any future increases in income to a Tier 1 employee
19who has made an election under paragraph (1) of subsection (a)
20of this Section on the condition of not constituting salary
21under Section 16-121.
22 As adequate and legal consideration provided under this
23amendatory Act of the 100th General Assembly for making an
24election under paragraph (1) of subsection (a) of this Section,
25each Tier 1 employee who has made an election under paragraph
26(1) of subsection (a) of this Section shall receive a

SB2194- 97 -LRB100 12225 RPS 24730 b
1consideration payment equal to 10% of the contributions made by
2or on behalf of the employee under paragraphs (1), (2), and (3)
3of subsection (a) of Section 16-152 before the effective date
4of that election. The State Comptroller shall pay the
5consideration payment to the Tier 1 employee out of funds
6appropriated for that purpose under Section 1.9 of the State
7Pension Funds Continuing Appropriation Act. The System shall
8calculate the amount of each consideration payment and, by July
91, 2018, shall certify to the State Comptroller the amount of
10the consideration payment, together with the name, address, and
11any other available payment information of the Tier 1 employee
12as found in the records of the System. The System shall make
13additional calculations and certifications of consideration
14payments to the State Comptroller as the System deems
15necessary.
16 (c) A Tier 1 employee who makes the election under
17paragraph (2) of subsection (a) of this Section shall not be
18subject to paragraph (1) of subsection (a) of this Section.
19However, each future increase in income offered by an employer
20under this Article to a Tier 1 employee who has made the
21election under paragraph (2) of subsection (a) of this Section
22shall be offered by the employer expressly and irrevocably on
23the condition of not constituting salary under Section 16-121
24and that the Tier 1 employee's acceptance of the offered future
25increase in income shall constitute his or her agreement to
26that condition.

SB2194- 98 -LRB100 12225 RPS 24730 b
1 (d) The System shall make a good faith effort to contact
2each Tier 1 employee subject to this Section. The System shall
3mail information describing the required election to each Tier
41 employee by United States Postal Service mail to his or her
5last known address on file with the System. If the Tier 1
6employee is not responsive to other means of contact, it is
7sufficient for the System to publish the details of any
8required elections on its website or to publish those details
9in a regularly published newsletter or other existing public
10forum.
11 Tier 1 employees who are subject to this Section shall be
12provided with an election packet containing information
13regarding their options, as well as the forms necessary to make
14the required election. Upon request, the System shall offer
15Tier 1 employees an opportunity to receive information from the
16System before making the required election. The information may
17consist of video materials, group presentations, individual
18consultation with a member or authorized representative of the
19System in person or by telephone or other electronic means, or
20any combination of those methods. The System shall not provide
21advice or counseling with respect to which election a Tier 1
22employee should make or specific to the legal or tax
23circumstances of or consequences to the Tier 1 employee.
24 The System shall inform Tier 1 employees in the election
25packet required under this subsection that the Tier 1 employee
26may also wish to obtain information and counsel relating to the

SB2194- 99 -LRB100 12225 RPS 24730 b
1election required under this Section from any other available
2source, including, but not limited to, labor organizations and
3private counsel.
4 In no event shall the System, its staff, or the Board be
5held liable for any information given to a member regarding the
6elections under this Section. The System shall coordinate with
7the Illinois Department of Central Management Services and each
8other retirement system administering an election in
9accordance with this amendatory Act of the 100th General
10Assembly to provide information concerning the impact of the
11election set forth in this Section.
12 (e) Notwithstanding any other provision of law, an employer
13under this Article is required to offer each future increase in
14income expressly and irrevocably on the condition of not
15constituting "salary" under Section 16-121 to any Tier 1
16employee who has made an election under paragraph (2) of
17subsection (a) of this Section. The offer shall also provide
18that the Tier 1 employee's acceptance of the offered future
19increase in income shall constitute his or her agreement to the
20condition set forth in this subsection.
21 For purposes of legislative intent, the condition set forth
22in this subsection shall be construed in a manner that ensures
23that the condition is not violated or circumvented through any
24contrivance of any kind.
25 (f) A member's election under this Section is not a
26prohibited election under subdivision (j)(1) of Section 1-119

SB2194- 100 -LRB100 12225 RPS 24730 b
1of this Code.
2 (g) No provision of this Section shall be interpreted in a
3way that would cause the System to cease to be a qualified plan
4under Section 401(a) of the Internal Revenue Code of 1986.
5 (h) If an election created by this amendatory Act in any
6other Article of this Code or any change deriving from that
7election is determined to be unconstitutional or otherwise
8invalid by a final unappealable decision of an Illinois court
9or a court of competent jurisdiction, the invalidity of that
10provision shall not in any way affect the validity of this
11Section or the changes deriving from the election required
12under this Section.
13 (40 ILCS 5/16-133.1) (from Ch. 108 1/2, par. 16-133.1)
14 (Text of Section WITHOUT the changes made by P.A. 98-599,
15which has been held unconstitutional)
16 Sec. 16-133.1. Automatic annual increase in annuity.
17 (a) Each member with creditable service and retiring on or
18after August 26, 1969 is entitled to the automatic annual
19increases in annuity provided under this Section while
20receiving a retirement annuity or disability retirement
21annuity from the system.
22 Except as otherwise provided in subsection (a-1), an An
23annuitant shall first be entitled to an initial increase under
24this Section on the January 1 next following the first
25anniversary of retirement, or January 1 of the year next

SB2194- 101 -LRB100 12225 RPS 24730 b
1following attainment of age 61, whichever is later. At such
2time, the system shall pay an initial increase determined as
3follows:
4 (1) 1.5% of the originally granted retirement annuity
5 or disability retirement annuity multiplied by the number
6 of years elapsed, if any, from the date of retirement until
7 January 1, 1972, plus
8 (2) 2% of the originally granted annuity multiplied by
9 the number of years elapsed, if any, from the date of
10 retirement or January 1, 1972, whichever is later, until
11 January 1, 1978, plus
12 (3) 3% of the originally granted annuity multiplied by
13 the number of years elapsed from the date of retirement or
14 January 1, 1978, whichever is later, until the effective
15 date of the initial increase.
16However, the initial annual increase calculated under this
17Section for the recipient of a disability retirement annuity
18granted under Section 16-149.2 shall be reduced by an amount
19equal to the total of all increases in that annuity received
20under Section 16-149.5 (but not exceeding 100% of the amount of
21the initial increase otherwise provided under this Section).
22 Except as otherwise provided in subsection (a-1),
23following Following the initial increase, automatic annual
24increases in annuity shall be payable on each January 1
25thereafter during the lifetime of the annuitant, determined as
26a percentage of the originally granted retirement annuity or

SB2194- 102 -LRB100 12225 RPS 24730 b
1disability retirement annuity for increases granted prior to
2January 1, 1990, and calculated as a percentage of the total
3amount of annuity, including previous increases under this
4Section, for increases granted on or after January 1, 1990, as
5follows: 1.5% for periods prior to January 1, 1972, 2% for
6periods after December 31, 1971 and prior to January 1, 1978,
7and 3% for periods after December 31, 1977.
8 (a-1) Notwithstanding any other provision of this Article,
9for a Tier 1 employee who made the election under paragraph (1)
10of subsection (a) of Section 16-122.9:
11 (1) The initial increase in retirement annuity under
12 this Section shall occur on the January 1 occurring either
13 on or after the attainment of age 67 or the fifth
14 anniversary of the annuity start date, whichever is
15 earlier.
16 (2) The amount of each automatic annual increase in
17 retirement annuity and survivor benefit occurring on or
18 after the effective date of that election shall be
19 calculated as a percentage of the originally granted
20 retirement annuity or survivor benefit, equal to 3% or
21 one-half the annual unadjusted percentage increase (but
22 not less than zero) in the consumer price index-u for the
23 12 months ending with the September preceding each November
24 1, whichever is less. If the annual unadjusted percentage
25 change in the consumer price index-u for the 12 months
26 ending with the September preceding each November 1 is zero

SB2194- 103 -LRB100 12225 RPS 24730 b
1 or there is a decrease, then the annuity shall not be
2 increased.
3 For the purposes of this Section, "consumer price index-u"
4means the index published by the Bureau of Labor Statistics of
5the United States Department of Labor that measures the average
6change in prices of goods and services purchased by all urban
7consumers, United States city average, all items, 1982-84 =
8100. The new amount resulting from each annual adjustment shall
9be determined by the Public Pension Division of the Department
10of Insurance and made available to the board of the retirement
11system by November 1 of each year.
12 (b) The automatic annual increases in annuity provided
13under this Section shall not be applicable unless a member has
14made contributions toward such increases for a period
15equivalent to one full year of creditable service. If a member
16contributes for service performed after August 26, 1969 but the
17member becomes an annuitant before such contributions amount to
18one full year's contributions based on the salary at the date
19of retirement, he or she may pay the necessary balance of the
20contributions to the system and be eligible for the automatic
21annual increases in annuity provided under this Section.
22 (c) Each member shall make contributions toward the cost of
23the automatic annual increases in annuity as provided under
24Section 16-152.
25 (d) An annuitant receiving a retirement annuity or
26disability retirement annuity on July 1, 1969, who subsequently

SB2194- 104 -LRB100 12225 RPS 24730 b
1re-enters service as a teacher is eligible for the automatic
2annual increases in annuity provided under this Section if he
3or she renders at least one year of creditable service
4following the latest re-entry.
5 (e) In addition to the automatic annual increases in
6annuity provided under this Section, an annuitant who meets the
7service requirements of this Section and whose retirement
8annuity or disability retirement annuity began on or before
9January 1, 1971 shall receive, on January 1, 1981, an increase
10in the annuity then being paid of one dollar per month for each
11year of creditable service. On January 1, 1982, an annuitant
12whose retirement annuity or disability retirement annuity
13began on or before January 1, 1977 shall receive an increase in
14the annuity then being paid of one dollar per month for each
15year of creditable service.
16 On January 1, 1987, any annuitant whose retirement annuity
17began on or before January 1, 1977, shall receive an increase
18in the monthly retirement annuity equal to 8 per year of
19creditable service times the number of years that have elapsed
20since the annuity began.
21(Source: P.A. 91-927, eff. 12-14-00.)
22 (40 ILCS 5/16-136.1) (from Ch. 108 1/2, par. 16-136.1)
23 (Text of Section WITHOUT the changes made by P.A. 98-599,
24which has been held unconstitutional)
25 Sec. 16-136.1. Annual increase for certain annuitants.

SB2194- 105 -LRB100 12225 RPS 24730 b
1 (a) Any annuitant receiving a retirement annuity on June
230, 1969 and any member retiring after June 30, 1969 shall be
3eligible for the annual increases provided under this Section
4provided the annuitant is ineligible for the automatic annual
5increase in annuity provided under Section 16-133.1, and
6provided further that (1) retirement occurred at age 55 or over
7and was based on 5 or more years of creditable service or (2)
8if retirement occurred prior to age 55, the retirement annuity
9was based on 20 or more years of creditable service.
10 (b) Except as otherwise provided in subsection (b-1), an An
11annuitant entitled to increases under this Section shall be
12entitled to the initial increase as of the later of: (1)
13January 1 following attainment of age 65, (2) January 1
14following the first anniversary of retirement, or (3) the first
15day of the month following receipt of the required qualifying
16contribution from the annuitant. The initial monthly increase
17shall be computed on the basis of the period elapsed between
18the later of the date of last retirement or attainment of age
1950 and the date of qualification for the initial increase, at
20the rate of 1 1/2% of the original monthly retirement annuity
21per year for periods prior to September 1, 1971, and at the
22rate of 2% per year for periods between September 1, 1971 and
23September 1, 1978, and at the rate of 3% per year for periods
24thereafter.
25 Except as otherwise provided in subsection (b-1), if
26applicable, an An annuitant who has received an initial

SB2194- 106 -LRB100 12225 RPS 24730 b
1increase under this Section, shall be entitled, on each January
21 following the granting of the initial increase, to an
3increase of 3% of the original monthly retirement annuity for
4increases granted prior to January 1, 1990, and equal to 3% of
5the total annuity, including previous increases under this
6Section, for increases granted on or after January 1, 1990. The
7original monthly retirement annuity for computations under
8this subsection (b) shall be considered to be $83.34 for any
9annuitant entitled to benefits under Section 16-134. The
10minimum original disability retirement annuity for
11computations under this subsection (b) shall be considered to
12be $33.34 per month for any annuitant retired on account of
13disability.
14 (b-1) Notwithstanding any other provision of this Article,
15for a Tier 1 employee who made the election under paragraph (1)
16of subsection (a) of Section 16-122.9:
17 (1) The initial increase in retirement annuity under
18 this Section shall occur on the January 1 occurring either
19 on or after the attainment of age 67 or the fifth
20 anniversary of the annuity start date, whichever is
21 earlier.
22 (2) The amount of each automatic annual increase in
23 retirement annuity or survivor benefit occurring on or
24 after the effective date of that election shall be
25 calculated as a percentage of the originally granted
26 retirement annuity or survivor benefit, equal to 3% or

SB2194- 107 -LRB100 12225 RPS 24730 b
1 one-half the annual unadjusted percentage increase (but
2 not less than zero) in the consumer price index-u for the
3 12 months ending with the September preceding each November
4 1, whichever is less. If the annual unadjusted percentage
5 change in the consumer price index-u for the 12 months
6 ending with the September preceding each November 1 is zero
7 or there is a decrease, then the annuity shall not be
8 increased.
9 For the purposes of this Section, "consumer price index-u"
10means the index published by the Bureau of Labor Statistics of
11the United States Department of Labor that measures the average
12change in prices of goods and services purchased by all urban
13consumers, United States city average, all items, 1982-84 =
14100. The new amount resulting from each annual adjustment shall
15be determined by the Public Pension Division of the Department
16of Insurance and made available to the board of the retirement
17system by November 1 of each year.
18 (c) An annuitant who otherwise qualifies for annual
19increases under this Section must make a one-time payment of 1%
20of the monthly final average salary for each full year of the
21creditable service forming the basis of the retirement annuity
22or, if the retirement annuity was not computed using final
23average salary, 1% of the original monthly retirement annuity
24for each full year of service forming the basis of the
25retirement annuity.
26 (d) In addition to other increases which may be provided by

SB2194- 108 -LRB100 12225 RPS 24730 b
1this Section, regardless of creditable service, annuitants not
2meeting the service requirements of Section 16-133.1 and whose
3retirement annuity began on or before January 1, 1971 shall
4receive, on January 1, 1981, an increase in the retirement
5annuity then being paid of one dollar per month for each year
6of creditable service forming the basis of the retirement
7allowance. On January 1, 1982, annuitants whose retirement
8annuity began on or before January 1, 1977, shall receive an
9increase in the retirement annuity then being paid of one
10dollar per month for each year of creditable service.
11 On January 1, 1987, any annuitant whose retirement annuity
12began on or before January 1, 1977, shall receive an increase
13in the monthly retirement annuity equal to 8 per year of
14creditable service times the number of years that have elapsed
15since the annuity began.
16(Source: P.A. 86-273.)
17 (40 ILCS 5/16-152) (from Ch. 108 1/2, par. 16-152)
18 (Text of Section WITHOUT the changes made by P.A. 98-599,
19which has been held unconstitutional)
20 Sec. 16-152. Contributions by members.
21 (a) Except as otherwise provided in subsection (a-5), each
22Each member shall make contributions for membership service to
23this System as follows:
24 (1) Effective July 1, 1998, contributions of 7.50% of
25 salary towards the cost of the retirement annuity. Such

SB2194- 109 -LRB100 12225 RPS 24730 b
1 contributions shall be deemed "normal contributions".
2 (2) Effective July 1, 1969, contributions of 1/2 of 1%
3 of salary toward the cost of the automatic annual increase
4 in retirement annuity provided under Section 16-133.1.
5 (3) Effective July 24, 1959, contributions of 1% of
6 salary towards the cost of survivor benefits. Such
7 contributions shall not be credited to the individual
8 account of the member and shall not be subject to refund
9 except as provided under Section 16-143.2.
10 (4) Effective July 1, 2005, contributions of 0.40% of
11 salary toward the cost of the early retirement without
12 discount option provided under Section 16-133.2. This
13 contribution shall cease upon termination of the early
14 retirement without discount option as provided in Section
15 16-133.2.
16 (a-5) Beginning July 1, 2018 or the effective date of the
17Tier 1 employee's election under paragraph (1) of subsection
18(a) of Section 16-122.9, whichever is later, in lieu of the
19contributions otherwise required under subsection (a), each
20Tier 1 employee who made the election under paragraph (1) of
21subsection (a) of Section 16-122.9 shall make contributions as
22follows:
23 (1) Contributions of 7.50% of salary towards the cost
24 of the retirement annuity. Such contributions shall be
25 deemed "normal contributions".
26 (2) Contributions of 0.60% towards the cost of survivor

SB2194- 110 -LRB100 12225 RPS 24730 b
1 benefits. Such contributions shall not be credited to the
2 individual account of the member and shall not be subject
3 to refund except as provided in Section 16-143.2.
4 (3) Contributions of 0.40% of salary toward the cost of
5 the early retirement without discount option provided
6 under Section 16-133.2. This contribution shall cease upon
7 termination of the early retirement without discount
8 option as provided in Section 16-133.2.
9 (b) The minimum required contribution for any year of
10full-time teaching service shall be $192.
11 (c) Contributions shall not be required of any annuitant
12receiving a retirement annuity who is given employment as
13permitted under Section 16-118 or 16-150.1.
14 (d) A person who (i) was a member before July 1, 1998, (ii)
15retires with more than 34 years of creditable service, and
16(iii) does not elect to qualify for the augmented rate under
17Section 16-129.1 shall be entitled, at the time of retirement,
18to receive a partial refund of contributions made under this
19Section for service occurring after the later of June 30, 1998
20or attainment of 34 years of creditable service, in an amount
21equal to 1.00% of the salary upon which those contributions
22were based.
23 (e) A member's contributions toward the cost of early
24retirement without discount made under item (a)(4) of this
25Section shall not be refunded if the member has elected early
26retirement without discount under Section 16-133.2 and has

SB2194- 111 -LRB100 12225 RPS 24730 b
1begun to receive a retirement annuity under this Article
2calculated in accordance with that election. Otherwise, a
3member's contributions toward the cost of early retirement
4without discount made under item (a)(4) of this Section shall
5be refunded according to whichever one of the following
6circumstances occurs first:
7 (1) The contributions shall be refunded to the member,
8 without interest, within 120 days after the member's
9 retirement annuity commences, if the member does not elect
10 early retirement without discount under Section 16-133.2.
11 (2) The contributions shall be included, without
12 interest, in any refund claimed by the member under Section
13 16-151.
14 (3) The contributions shall be refunded to the member's
15 designated beneficiary (or if there is no beneficiary, to
16 the member's estate), without interest, if the member dies
17 without having begun to receive a retirement annuity under
18 this Article.
19 (4) The contributions shall be refunded to the member,
20 without interest, if the early retirement without discount
21 option provided under subsection (d) of Section 16-133.2 is
22 terminated. In that event, the System shall provide to the
23 member, within 120 days after the option is terminated, an
24 application for a refund of those contributions.
25(Source: P.A. 98-42, eff. 6-28-13; 98-92, eff. 7-16-13; 99-642,
26eff. 7-28-16.)

SB2194- 112 -LRB100 12225 RPS 24730 b
1 (40 ILCS 5/16-158) (from Ch. 108 1/2, par. 16-158)
2 (Text of Section WITHOUT the changes made by P.A. 98-599,
3which has been held unconstitutional)
4 Sec. 16-158. Contributions by State and other employing
5units.
6 (a) The State shall make contributions to the System by
7means of appropriations from the Common School Fund and other
8State funds of amounts which, together with other employer
9contributions, employee contributions, investment income, and
10other income, will be sufficient to meet the cost of
11maintaining and administering the System on a 90% funded basis
12in accordance with actuarial recommendations.
13 The Board shall determine the amount of State contributions
14required for each fiscal year on the basis of the actuarial
15tables and other assumptions adopted by the Board and the
16recommendations of the actuary, using the formula in subsection
17(b-3).
18 (a-1) Annually, on or before November 15 until November 15,
192011, the Board shall certify to the Governor the amount of the
20required State contribution for the coming fiscal year. The
21certification under this subsection (a-1) shall include a copy
22of the actuarial recommendations upon which it is based and
23shall specifically identify the System's projected State
24normal cost for that fiscal year.
25 On or before May 1, 2004, the Board shall recalculate and

SB2194- 113 -LRB100 12225 RPS 24730 b
1recertify to the Governor the amount of the required State
2contribution to the System for State fiscal year 2005, taking
3into account the amounts appropriated to and received by the
4System under subsection (d) of Section 7.2 of the General
5Obligation Bond Act.
6 On or before July 1, 2005, the Board shall recalculate and
7recertify to the Governor the amount of the required State
8contribution to the System for State fiscal year 2006, taking
9into account the changes in required State contributions made
10by this amendatory Act of the 94th General Assembly.
11 On or before April 1, 2011, the Board shall recalculate and
12recertify to the Governor the amount of the required State
13contribution to the System for State fiscal year 2011, applying
14the changes made by Public Act 96-889 to the System's assets
15and liabilities as of June 30, 2009 as though Public Act 96-889
16was approved on that date.
17 (a-5) On or before November 1 of each year, beginning
18November 1, 2012, the Board shall submit to the State Actuary,
19the Governor, and the General Assembly a proposed certification
20of the amount of the required State contribution to the System
21for the next fiscal year, along with all of the actuarial
22assumptions, calculations, and data upon which that proposed
23certification is based. On or before January 1 of each year,
24beginning January 1, 2013, the State Actuary shall issue a
25preliminary report concerning the proposed certification and
26identifying, if necessary, recommended changes in actuarial

SB2194- 114 -LRB100 12225 RPS 24730 b
1assumptions that the Board must consider before finalizing its
2certification of the required State contributions. On or before
3January 15, 2013 and each January 15 thereafter, the Board
4shall certify to the Governor and the General Assembly the
5amount of the required State contribution for the next fiscal
6year. The Board's certification must note any deviations from
7the State Actuary's recommended changes, the reason or reasons
8for not following the State Actuary's recommended changes, and
9the fiscal impact of not following the State Actuary's
10recommended changes on the required State contribution.
11 (a-10) On or before May 1, 2018, the Board shall
12recalculate and recertify to the Governor and the General
13Assembly the amount of the required State contribution to the
14System for State fiscal year 2019, taking into account the
15effect on the System's liabilities of the elections made under
16Section 16-122.9.
17 On or before October 1, 2018, the Board shall recalculate
18and recertify to the Governor and the General Assembly the
19amount of the required State contribution to the System for
20State fiscal year 2019, taking into account the reduction
21specified under item (3) of subsection (b-3) of this Section.
22 (b) Through State fiscal year 1995, the State contributions
23shall be paid to the System in accordance with Section 18-7 of
24the School Code.
25 (b-1) Beginning in State fiscal year 1996, on the 15th day
26of each month, or as soon thereafter as may be practicable, the

SB2194- 115 -LRB100 12225 RPS 24730 b
1Board shall submit vouchers for payment of State contributions
2to the System, in a total monthly amount of one-twelfth of the
3required annual State contribution certified under subsection
4(a-1). From the effective date of this amendatory Act of the
593rd General Assembly through June 30, 2004, the Board shall
6not submit vouchers for the remainder of fiscal year 2004 in
7excess of the fiscal year 2004 certified contribution amount
8determined under this Section after taking into consideration
9the transfer to the System under subsection (a) of Section
106z-61 of the State Finance Act. These vouchers shall be paid by
11the State Comptroller and Treasurer by warrants drawn on the
12funds appropriated to the System for that fiscal year.
13 If in any month the amount remaining unexpended from all
14other appropriations to the System for the applicable fiscal
15year (including the appropriations to the System under Section
168.12 of the State Finance Act and Section 1 of the State
17Pension Funds Continuing Appropriation Act) is less than the
18amount lawfully vouchered under this subsection, the
19difference shall be paid from the Common School Fund under the
20continuing appropriation authority provided in Section 1.1 of
21the State Pension Funds Continuing Appropriation Act.
22 (b-2) Allocations from the Common School Fund apportioned
23to school districts not coming under this System shall not be
24diminished or affected by the provisions of this Article.
25 (b-3) For State fiscal years 2012 through 2045 (except as
26otherwise provided for fiscal year 2019), the minimum

SB2194- 116 -LRB100 12225 RPS 24730 b
1contribution to the System to be made by the State for each
2fiscal year shall be an amount determined by the System to be
3sufficient to bring the total assets of the System up to 90% of
4the total actuarial liabilities of the System by the end of
5State fiscal year 2045. In making these determinations, the
6required State contribution shall be calculated each year as a
7level percentage of payroll over the years remaining to and
8including fiscal year 2045 and shall be determined under the
9projected unit credit actuarial cost method.
10 For State fiscal year 2019:
11 (1) The initial calculation and certification shall be
12 based on the amount determined above.
13 (2) For purposes of the recertification due on or
14 before May 1, 2018, the recalculation of the required State
15 contribution for fiscal year 2019 shall take into account
16 the effect on the System's liabilities of the elections
17 made under Section 16-122.9.
18 (3) For purposes of the recertification due on or
19 before October 1, 2018, the total required State
20 contribution for fiscal year 2019 shall be reduced by the
21 amount of the consideration payments made to Tier 1
22 employees who made the election under paragraph (1) of
23 subsection (a) of Section 16-122.9.
24 For State fiscal years 1996 through 2005, the State
25contribution to the System, as a percentage of the applicable
26employee payroll, shall be increased in equal annual increments

SB2194- 117 -LRB100 12225 RPS 24730 b
1so that by State fiscal year 2011, the State is contributing at
2the rate required under this Section; except that in the
3following specified State fiscal years, the State contribution
4to the System shall not be less than the following indicated
5percentages of the applicable employee payroll, even if the
6indicated percentage will produce a State contribution in
7excess of the amount otherwise required under this subsection
8and subsection (a), and notwithstanding any contrary
9certification made under subsection (a-1) before the effective
10date of this amendatory Act of 1998: 10.02% in FY 1999; 10.77%
11in FY 2000; 11.47% in FY 2001; 12.16% in FY 2002; 12.86% in FY
122003; and 13.56% in FY 2004.
13 Notwithstanding any other provision of this Article, the
14total required State contribution for State fiscal year 2006 is
15$534,627,700.
16 Notwithstanding any other provision of this Article, the
17total required State contribution for State fiscal year 2007 is
18$738,014,500.
19 For each of State fiscal years 2008 through 2009, the State
20contribution to the System, as a percentage of the applicable
21employee payroll, shall be increased in equal annual increments
22from the required State contribution for State fiscal year
232007, so that by State fiscal year 2011, the State is
24contributing at the rate otherwise required under this Section.
25 Notwithstanding any other provision of this Article, the
26total required State contribution for State fiscal year 2010 is

SB2194- 118 -LRB100 12225 RPS 24730 b
1$2,089,268,000 and shall be made from the proceeds of bonds
2sold in fiscal year 2010 pursuant to Section 7.2 of the General
3Obligation Bond Act, less (i) the pro rata share of bond sale
4expenses determined by the System's share of total bond
5proceeds, (ii) any amounts received from the Common School Fund
6in fiscal year 2010, and (iii) any reduction in bond proceeds
7due to the issuance of discounted bonds, if applicable.
8 Notwithstanding any other provision of this Article, the
9total required State contribution for State fiscal year 2011 is
10the amount recertified by the System on or before April 1, 2011
11pursuant to subsection (a-1) of this Section and shall be made
12from the proceeds of bonds sold in fiscal year 2011 pursuant to
13Section 7.2 of the General Obligation Bond Act, less (i) the
14pro rata share of bond sale expenses determined by the System's
15share of total bond proceeds, (ii) any amounts received from
16the Common School Fund in fiscal year 2011, and (iii) any
17reduction in bond proceeds due to the issuance of discounted
18bonds, if applicable. This amount shall include, in addition to
19the amount certified by the System, an amount necessary to meet
20employer contributions required by the State as an employer
21under paragraph (e) of this Section, which may also be used by
22the System for contributions required by paragraph (a) of
23Section 16-127.
24 Beginning in State fiscal year 2046, the minimum State
25contribution for each fiscal year shall be the amount needed to
26maintain the total assets of the System at 90% of the total

SB2194- 119 -LRB100 12225 RPS 24730 b
1actuarial liabilities of the System.
2 Amounts received by the System pursuant to Section 25 of
3the Budget Stabilization Act or Section 8.12 of the State
4Finance Act in any fiscal year do not reduce and do not
5constitute payment of any portion of the minimum State
6contribution required under this Article in that fiscal year.
7Such amounts shall not reduce, and shall not be included in the
8calculation of, the required State contributions under this
9Article in any future year until the System has reached a
10funding ratio of at least 90%. A reference in this Article to
11the "required State contribution" or any substantially similar
12term does not include or apply to any amounts payable to the
13System under Section 25 of the Budget Stabilization Act.
14 Notwithstanding any other provision of this Section, the
15required State contribution for State fiscal year 2005 and for
16fiscal year 2008 and each fiscal year thereafter, as calculated
17under this Section and certified under subsection (a-1), shall
18not exceed an amount equal to (i) the amount of the required
19State contribution that would have been calculated under this
20Section for that fiscal year if the System had not received any
21payments under subsection (d) of Section 7.2 of the General
22Obligation Bond Act, minus (ii) the portion of the State's
23total debt service payments for that fiscal year on the bonds
24issued in fiscal year 2003 for the purposes of that Section
257.2, as determined and certified by the Comptroller, that is
26the same as the System's portion of the total moneys

SB2194- 120 -LRB100 12225 RPS 24730 b
1distributed under subsection (d) of Section 7.2 of the General
2Obligation Bond Act. In determining this maximum for State
3fiscal years 2008 through 2010, however, the amount referred to
4in item (i) shall be increased, as a percentage of the
5applicable employee payroll, in equal increments calculated
6from the sum of the required State contribution for State
7fiscal year 2007 plus the applicable portion of the State's
8total debt service payments for fiscal year 2007 on the bonds
9issued in fiscal year 2003 for the purposes of Section 7.2 of
10the General Obligation Bond Act, so that, by State fiscal year
112011, the State is contributing at the rate otherwise required
12under this Section.
13 (c) Payment of the required State contributions and of all
14pensions, retirement annuities, death benefits, refunds, and
15other benefits granted under or assumed by this System, and all
16expenses in connection with the administration and operation
17thereof, are obligations of the State.
18 If members are paid from special trust or federal funds
19which are administered by the employing unit, whether school
20district or other unit, the employing unit shall pay to the
21System from such funds the full accruing retirement costs based
22upon that service, which, beginning July 1, 2014, shall be at a
23rate, expressed as a percentage of salary, equal to the total
24minimum contribution to the System to be made by the State for
25that fiscal year, including both normal cost and unfunded
26liability components, expressed as a percentage of payroll, as

SB2194- 121 -LRB100 12225 RPS 24730 b
1determined by the System under subsection (b-3) of this
2Section. Employer contributions, based on salary paid to
3members from federal funds, may be forwarded by the
4distributing agency of the State of Illinois to the System
5prior to allocation, in an amount determined in accordance with
6guidelines established by such agency and the System. Any
7contribution for fiscal year 2015 collected as a result of the
8change made by this amendatory Act of the 98th General Assembly
9shall be considered a State contribution under subsection (b-3)
10of this Section.
11 (d) Effective July 1, 1986, any employer of a teacher as
12defined in paragraph (8) of Section 16-106 shall pay the
13employer's normal cost of benefits based upon the teacher's
14service, in addition to employee contributions, as determined
15by the System. Such employer contributions shall be forwarded
16monthly in accordance with guidelines established by the
17System.
18 However, with respect to benefits granted under Section
1916-133.4 or 16-133.5 to a teacher as defined in paragraph (8)
20of Section 16-106, the employer's contribution shall be 12%
21(rather than 20%) of the member's highest annual salary rate
22for each year of creditable service granted, and the employer
23shall also pay the required employee contribution on behalf of
24the teacher. For the purposes of Sections 16-133.4 and
2516-133.5, a teacher as defined in paragraph (8) of Section
2616-106 who is serving in that capacity while on leave of

SB2194- 122 -LRB100 12225 RPS 24730 b
1absence from another employer under this Article shall not be
2considered an employee of the employer from which the teacher
3is on leave.
4 (e) Beginning July 1, 1998, every employer of a teacher
5shall pay to the System an employer contribution computed as
6follows:
7 (1) Beginning July 1, 1998 through June 30, 1999, the
8 employer contribution shall be equal to 0.3% of each
9 teacher's salary.
10 (2) Beginning July 1, 1999 and thereafter, the employer
11 contribution shall be equal to 0.58% of each teacher's
12 salary.
13The school district or other employing unit may pay these
14employer contributions out of any source of funding available
15for that purpose and shall forward the contributions to the
16System on the schedule established for the payment of member
17contributions.
18 These employer contributions are intended to offset a
19portion of the cost to the System of the increases in
20retirement benefits resulting from this amendatory Act of 1998.
21 Each employer of teachers is entitled to a credit against
22the contributions required under this subsection (e) with
23respect to salaries paid to teachers for the period January 1,
242002 through June 30, 2003, equal to the amount paid by that
25employer under subsection (a-5) of Section 6.6 of the State
26Employees Group Insurance Act of 1971 with respect to salaries

SB2194- 123 -LRB100 12225 RPS 24730 b
1paid to teachers for that period.
2 The additional 1% employee contribution required under
3Section 16-152 by this amendatory Act of 1998 is the
4responsibility of the teacher and not the teacher's employer,
5unless the employer agrees, through collective bargaining or
6otherwise, to make the contribution on behalf of the teacher.
7 If an employer is required by a contract in effect on May
81, 1998 between the employer and an employee organization to
9pay, on behalf of all its full-time employees covered by this
10Article, all mandatory employee contributions required under
11this Article, then the employer shall be excused from paying
12the employer contribution required under this subsection (e)
13for the balance of the term of that contract. The employer and
14the employee organization shall jointly certify to the System
15the existence of the contractual requirement, in such form as
16the System may prescribe. This exclusion shall cease upon the
17termination, extension, or renewal of the contract at any time
18after May 1, 1998.
19 (f) If the amount of a teacher's salary for any school year
20used to determine final average salary exceeds the member's
21annual full-time salary rate with the same employer for the
22previous school year by more than 6%, the teacher's employer
23shall pay to the System, in addition to all other payments
24required under this Section and in accordance with guidelines
25established by the System, the present value of the increase in
26benefits resulting from the portion of the increase in salary

SB2194- 124 -LRB100 12225 RPS 24730 b
1that is in excess of 6%. This present value shall be computed
2by the System on the basis of the actuarial assumptions and
3tables used in the most recent actuarial valuation of the
4System that is available at the time of the computation. If a
5teacher's salary for the 2005-2006 school year is used to
6determine final average salary under this subsection (f), then
7the changes made to this subsection (f) by Public Act 94-1057
8shall apply in calculating whether the increase in his or her
9salary is in excess of 6%. For the purposes of this Section,
10change in employment under Section 10-21.12 of the School Code
11on or after June 1, 2005 shall constitute a change in employer.
12The System may require the employer to provide any pertinent
13information or documentation. The changes made to this
14subsection (f) by this amendatory Act of the 94th General
15Assembly apply without regard to whether the teacher was in
16service on or after its effective date.
17 Whenever it determines that a payment is or may be required
18under this subsection, the System shall calculate the amount of
19the payment and bill the employer for that amount. The bill
20shall specify the calculations used to determine the amount
21due. If the employer disputes the amount of the bill, it may,
22within 30 days after receipt of the bill, apply to the System
23in writing for a recalculation. The application must specify in
24detail the grounds of the dispute and, if the employer asserts
25that the calculation is subject to subsection (g) or (h) of
26this Section, must include an affidavit setting forth and

SB2194- 125 -LRB100 12225 RPS 24730 b
1attesting to all facts within the employer's knowledge that are
2pertinent to the applicability of that subsection. Upon
3receiving a timely application for recalculation, the System
4shall review the application and, if appropriate, recalculate
5the amount due.
6 The employer contributions required under this subsection
7(f) may be paid in the form of a lump sum within 90 days after
8receipt of the bill. If the employer contributions are not paid
9within 90 days after receipt of the bill, then interest will be
10charged at a rate equal to the System's annual actuarially
11assumed rate of return on investment compounded annually from
12the 91st day after receipt of the bill. Payments must be
13concluded within 3 years after the employer's receipt of the
14bill.
15 (g) This subsection (g) applies only to payments made or
16salary increases given on or after June 1, 2005 but before July
171, 2011. The changes made by Public Act 94-1057 shall not
18require the System to refund any payments received before July
1931, 2006 (the effective date of Public Act 94-1057).
20 When assessing payment for any amount due under subsection
21(f), the System shall exclude salary increases paid to teachers
22under contracts or collective bargaining agreements entered
23into, amended, or renewed before June 1, 2005.
24 When assessing payment for any amount due under subsection
25(f), the System shall exclude salary increases paid to a
26teacher at a time when the teacher is 10 or more years from

SB2194- 126 -LRB100 12225 RPS 24730 b
1retirement eligibility under Section 16-132 or 16-133.2.
2 When assessing payment for any amount due under subsection
3(f), the System shall exclude salary increases resulting from
4overload work, including summer school, when the school
5district has certified to the System, and the System has
6approved the certification, that (i) the overload work is for
7the sole purpose of classroom instruction in excess of the
8standard number of classes for a full-time teacher in a school
9district during a school year and (ii) the salary increases are
10equal to or less than the rate of pay for classroom instruction
11computed on the teacher's current salary and work schedule.
12 When assessing payment for any amount due under subsection
13(f), the System shall exclude a salary increase resulting from
14a promotion (i) for which the employee is required to hold a
15certificate or supervisory endorsement issued by the State
16Teacher Certification Board that is a different certification
17or supervisory endorsement than is required for the teacher's
18previous position and (ii) to a position that has existed and
19been filled by a member for no less than one complete academic
20year and the salary increase from the promotion is an increase
21that results in an amount no greater than the lesser of the
22average salary paid for other similar positions in the district
23requiring the same certification or the amount stipulated in
24the collective bargaining agreement for a similar position
25requiring the same certification.
26 When assessing payment for any amount due under subsection

SB2194- 127 -LRB100 12225 RPS 24730 b
1(f), the System shall exclude any payment to the teacher from
2the State of Illinois or the State Board of Education over
3which the employer does not have discretion, notwithstanding
4that the payment is included in the computation of final
5average salary.
6 (h) When assessing payment for any amount due under
7subsection (f), the System shall exclude any salary increase
8described in subsection (g) of this Section given on or after
9July 1, 2011 but before July 1, 2014 under a contract or
10collective bargaining agreement entered into, amended, or
11renewed on or after June 1, 2005 but before July 1, 2011.
12Notwithstanding any other provision of this Section, any
13payments made or salary increases given after June 30, 2014
14shall be used in assessing payment for any amount due under
15subsection (f) of this Section.
16 (i) The System shall prepare a report and file copies of
17the report with the Governor and the General Assembly by
18January 1, 2007 that contains all of the following information:
19 (1) The number of recalculations required by the
20 changes made to this Section by Public Act 94-1057 for each
21 employer.
22 (2) The dollar amount by which each employer's
23 contribution to the System was changed due to
24 recalculations required by Public Act 94-1057.
25 (3) The total amount the System received from each
26 employer as a result of the changes made to this Section by

SB2194- 128 -LRB100 12225 RPS 24730 b
1 Public Act 94-4.
2 (4) The increase in the required State contribution
3 resulting from the changes made to this Section by Public
4 Act 94-1057.
5 (j) For purposes of determining the required State
6contribution to the System, the value of the System's assets
7shall be equal to the actuarial value of the System's assets,
8which shall be calculated as follows:
9 As of June 30, 2008, the actuarial value of the System's
10assets shall be equal to the market value of the assets as of
11that date. In determining the actuarial value of the System's
12assets for fiscal years after June 30, 2008, any actuarial
13gains or losses from investment return incurred in a fiscal
14year shall be recognized in equal annual amounts over the
155-year period following that fiscal year.
16 (k) For purposes of determining the required State
17contribution to the system for a particular year, the actuarial
18value of assets shall be assumed to earn a rate of return equal
19to the system's actuarially assumed rate of return.
20 (l) If Section 16-122.9 is determined to be
21unconstitutional or otherwise invalid by a final unappealable
22decision of an Illinois court or a court of competent
23jurisdiction, then the changes made to this Section by this
24amendatory Act of the 100th General Assembly shall not take
25effect and are repealed by operation of law.
26(Source: P.A. 96-43, eff. 7-15-09; 96-1497, eff. 1-14-11;

SB2194- 129 -LRB100 12225 RPS 24730 b
196-1511, eff. 1-27-11; 96-1554, eff. 3-18-11; 97-694, eff.
26-18-12; 97-813, eff. 7-13-12; 98-674, eff. 6-30-14.)
3 (40 ILCS 5/16-203)
4 (Text of Section WITHOUT the changes made by P.A. 98-599,
5which has been held unconstitutional)
6 Sec. 16-203. Application and expiration of new benefit
7increases.
8 (a) As used in this Section, "new benefit increase" means
9an increase in the amount of any benefit provided under this
10Article, or an expansion of the conditions of eligibility for
11any benefit under this Article, that results from an amendment
12to this Code that takes effect after June 1, 2005 (the
13effective date of Public Act 94-4). "New benefit increase",
14however, does not include any benefit increase resulting from
15the changes made to this Article by Public Act 95-910 or this
16amendatory Act of the 100th General Assembly this amendatory
17Act of the 95th General Assembly.
18 (b) Notwithstanding any other provision of this Code or any
19subsequent amendment to this Code, every new benefit increase
20is subject to this Section and shall be deemed to be granted
21only in conformance with and contingent upon compliance with
22the provisions of this Section.
23 (c) The Public Act enacting a new benefit increase must
24identify and provide for payment to the System of additional
25funding at least sufficient to fund the resulting annual

SB2194- 130 -LRB100 12225 RPS 24730 b
1increase in cost to the System as it accrues.
2 Every new benefit increase is contingent upon the General
3Assembly providing the additional funding required under this
4subsection. The Commission on Government Forecasting and
5Accountability shall analyze whether adequate additional
6funding has been provided for the new benefit increase and
7shall report its analysis to the Public Pension Division of the
8Department of Insurance Financial and Professional Regulation.
9A new benefit increase created by a Public Act that does not
10include the additional funding required under this subsection
11is null and void. If the Public Pension Division determines
12that the additional funding provided for a new benefit increase
13under this subsection is or has become inadequate, it may so
14certify to the Governor and the State Comptroller and, in the
15absence of corrective action by the General Assembly, the new
16benefit increase shall expire at the end of the fiscal year in
17which the certification is made.
18 (d) Every new benefit increase shall expire 5 years after
19its effective date or on such earlier date as may be specified
20in the language enacting the new benefit increase or provided
21under subsection (c). This does not prevent the General
22Assembly from extending or re-creating a new benefit increase
23by law.
24 (e) Except as otherwise provided in the language creating
25the new benefit increase, a new benefit increase that expires
26under this Section continues to apply to persons who applied

SB2194- 131 -LRB100 12225 RPS 24730 b
1and qualified for the affected benefit while the new benefit
2increase was in effect and to the affected beneficiaries and
3alternate payees of such persons, but does not apply to any
4other person, including without limitation a person who
5continues in service after the expiration date and did not
6apply and qualify for the affected benefit while the new
7benefit increase was in effect.
8(Source: P.A. 94-4, eff. 6-1-05; 95-910, eff. 8-26-08.)
9 (40 ILCS 5/17-106.05 new)
10 Sec. 17-106.05. Tier 1 employee. "Tier 1 employee": A
11teacher under this Article who first became a member or
12participant before January 1, 2011 under any reciprocal
13retirement system or pension fund established under this Code
14other than a retirement system or pension fund established
15under Article 2, 3, 4, 5, 6, or 18 of this Code. However, for
16the purposes of the election under Section 17-115.5, "Tier 1
17employee" does not include a teacher under this Article who
18would qualify as a Tier 1 employee but who has made an
19irrevocable election on or before June 1, 2017 to retire from
20service pursuant to the terms of an employment contract or a
21collective bargaining agreement in effect on June 1, 2017,
22excluding any extension, amendment, or renewal of that
23agreement after that date, and has notified the Fund of that
24election.

SB2194- 132 -LRB100 12225 RPS 24730 b
1 (40 ILCS 5/17-113.4 new)
2 Sec. 17-113.4. Salary. "Salary" means any income in any
3form that qualifies as "average salary" or "annual rate of
4salary" for purposes of paragraph (1) of subsection (c) of
5Section 17-116 and "salary" for payroll deduction purposes
6under Sections 17-130, 17-131, and 17-132.
7 Notwithstanding any other provision of this Section,
8"salary" does not include any future increase in income that is
9offered by an employer for service as a Tier 1 employee under
10this Article pursuant to the condition set forth in subsection
11(c) of Section 17-115.5 and accepted under that condition by a
12Tier 1 employee who has made the election under paragraph (2)
13of subsection (a) of Section 17-115.5.
14 (40 ILCS 5/17-113.5 new)
15 Sec. 17-113.5. Future increase in income. "Future increase
16in income" means an increase to a Tier 1 employee's base pay
17that is offered by an employer to the Tier 1 employee for
18service under this Article after June 30, 2018 that qualifies
19as "salary", as defined in Section 17-113.4, or would qualify
20as "salary" but for the fact that it was offered to and
21accepted by the Tier 1 employee under the condition set forth
22in subsection (c) of Section 17-115.5. The term "future
23increase in income" includes an increase to a Tier 1 employee's
24base pay that is paid to the Tier 1 employee pursuant to an
25extension, amendment, or renewal of any employment contract or

SB2194- 133 -LRB100 12225 RPS 24730 b
1collective bargaining agreement after the effective date of
2this Section.
3 (40 ILCS 5/17-113.6 new)
4 Sec. 17-113.6. Base pay. As used in Section 17-113.5 of
5this Code, "base pay" means the greater of either (i) the Tier
61 employee's annualized rate of salary as of June 30, 2018, or
7(ii) the Tier 1 employee's annualized rate of salary
8immediately preceding the expiration, renewal, or amendment of
9an employment contract or collective bargaining agreement in
10effect on the effective date of this Section. For a person
11returning to active service as a Tier 1 employee after June 30,
122018, however, "base pay" means the employee's annualized rate
13of salary as of the employee's last date of service prior to
14July 1, 2018. The Fund shall calculate the base pay of each
15Tier 1 employee pursuant to this Section.
16 (40 ILCS 5/17-115.5 new)
17 Sec. 17-115.5. Election by Tier 1 employees.
18 (a) Each active Tier 1 employee shall make an irrevocable
19election either:
20 (1) to agree to delay his or her eligibility for
21 automatic annual increases in service retirement pension
22 as provided in Section 17-119.2 and to have the amount of
23 the automatic annual increases in his or her service
24 retirement pension and survivor's pension that are

SB2194- 134 -LRB100 12225 RPS 24730 b
1 otherwise provided for in this Article calculated,
2 instead, as provided in Section 17-119.2; or
3 (2) to not agree to paragraph (1) of this subsection.
4 The election required under this subsection (a) shall be
5made by each active Tier 1 employee no earlier than January 1,
62018 and no later than March 31, 2018, except that:
7 (i) a person who becomes a Tier 1 employee under this
8 Article on or after January 1, 2018 must make the election
9 under this subsection (a) within 60 days after becoming a
10 Tier 1 employee; and
11 (ii) a person who returns to active service as a Tier 1
12 employee under this Article on or after January 1, 2018 and
13 has not yet made an election under this Section must make
14 the election under this subsection (a) within 60 days after
15 returning to active service as a Tier 1 employee.
16 If a Tier 1 employee fails for any reason to make a
17required election under this subsection within the time
18specified, then the employee shall be deemed to have made the
19election under paragraph (2) of this subsection.
20 (a-5) If this Section is enjoined or stayed by an Illinois
21court or a court of competent jurisdiction pending the entry of
22a final and unappealable decision, and this Section is
23determined to be constitutional or otherwise valid by a final
24unappealable decision of an Illinois court or a court of
25competent jurisdiction, then the election procedure set forth
26in subsection (a) of this Section shall commence on the 180th

SB2194- 135 -LRB100 12225 RPS 24730 b
1calendar day after the date of the issuance of the final
2unappealable decision and shall conclude at the end of the
3270th calendar day after that date.
4 (a-10) All elections under subsection (a) that are made or
5deemed to be made before July 1, 2018 shall take effect on July
61, 2018. Elections that are made or deemed to be made on or
7after July 1, 2018 shall take effect on the first day of the
8month following the month in which the election is made or
9deemed to be made.
10 (b) As adequate and legal consideration provided under this
11amendatory Act of the 100th General Assembly for making an
12election under paragraph (1) of subsection (a) of this Section,
13an employer shall be expressly and irrevocably prohibited from
14offering any future increases in income to a Tier 1 employee
15who has made an election under paragraph (1) of subsection (a)
16of this Section on the condition of not constituting salary
17under Section 17-113.4.
18 As adequate and legal consideration provided under this
19amendatory Act of the 100th General Assembly for making an
20election under paragraph (1) of subsection (a) of this Section,
21each Tier 1 employee who has made an election under paragraph
22(1) of subsection (a) of this Section shall receive a
23consideration payment equal to 10% of the contributions made by
24or on behalf of the employee under Section 17-130 before the
25effective date of that election. The State Comptroller shall
26pay the consideration payment to the Tier 1 employee out of

SB2194- 136 -LRB100 12225 RPS 24730 b
1funds appropriated for that purpose under Section 1.9 of the
2State Pension Funds Continuing Appropriation Act. The Fund
3shall calculate the amount of each consideration payment and,
4by July 1, 2018, shall certify to the State Comptroller the
5amount of the consideration payment, together with the name,
6address, and any other available payment information of the
7Tier 1 employee as found in the records of the Fund. The Fund
8shall make additional calculations and certifications of
9consideration payments to the State Comptroller as the Fund
10deems necessary.
11 (c) A Tier 1 employee who makes the election under
12paragraph (2) of subsection (a) of this Section shall not be
13subject to paragraph (1) of subsection (a) of this Section.
14However, each future increase in income offered by an employer
15under this Article to a Tier 1 employee who has made the
16election under paragraph (2) of subsection (a) of this Section
17shall be offered by the employer expressly and irrevocably on
18the condition of not constituting salary under Section 17-113.4
19and that the Tier 1 employee's acceptance of the offered future
20increase in income shall constitute his or her agreement to
21that condition.
22 (d) The Fund shall make a good faith effort to contact each
23Tier 1 employee subject to this Section. The Fund shall mail
24information describing the required election to each Tier 1
25employee by United States Postal Service mail to his or her
26last known address on file with the Fund. If the Tier 1

SB2194- 137 -LRB100 12225 RPS 24730 b
1employee is not responsive to other means of contact, it is
2sufficient for the Fund to publish the details of any required
3elections on its website or to publish those details in a
4regularly published newsletter or other existing public forum.
5 Tier 1 employees who are subject to this Section shall be
6provided with an election packet containing information
7regarding their options, as well as the forms necessary to make
8the required election. Upon request, the Fund shall offer Tier
91 employees an opportunity to receive information from the Fund
10before making the required election. The information may
11consist of video materials, group presentations, individual
12consultation with a member or authorized representative of the
13Fund in person or by telephone or other electronic means, or
14any combination of those methods. The Fund shall not provide
15advice or counseling with respect to which election a Tier 1
16employee should make or specific to the legal or tax
17circumstances of or consequences to the Tier 1 employee.
18 The Fund shall inform Tier 1 employees in the election
19packet required under this subsection that the Tier 1 employee
20may also wish to obtain information and counsel relating to the
21election required under this Section from any other available
22source, including, but not limited to, labor organizations and
23private counsel.
24 In no event shall the Fund, its staff, or the Board be held
25liable for any information given to a member regarding the
26elections under this Section. The Fund shall coordinate with

SB2194- 138 -LRB100 12225 RPS 24730 b
1the Illinois Department of Central Management Services and each
2other retirement system administering an election in
3accordance with this amendatory Act of the 100th General
4Assembly to provide information concerning the impact of the
5election set forth in this Section.
6 (e) Notwithstanding any other provision of law, an employer
7under this Article is required to offer each future increase in
8income expressly and irrevocably on the condition of not
9constituting "salary" under Section 17-113.4 to any Tier 1
10employee who has made an election under paragraph (2) of
11subsection (a) of this Section. The offer shall also provide
12that the Tier 1 employee's acceptance of the offered future
13increase in income shall constitute his or her agreement to the
14condition set forth in this subsection.
15 For purposes of legislative intent, the condition set forth
16in this subsection shall be construed in a manner that ensures
17that the condition is not violated or circumvented through any
18contrivance of any kind.
19 (f) A member's election under this Section is not a
20prohibited election under subdivision (j)(1) of Section 1-119
21of this Code.
22 (g) No provision of this Section shall be interpreted in a
23way that would cause the Fund to cease to be a qualified plan
24under Section 401(a) of the Internal Revenue Code of 1986.
25 (h) If an election created by this amendatory Act in any
26other Article of this Code or any change deriving from that

SB2194- 139 -LRB100 12225 RPS 24730 b
1election is determined to be unconstitutional or otherwise
2invalid by a final unappealable decision of an Illinois court
3or a court of competent jurisdiction, the invalidity of that
4provision shall not in any way affect the validity of this
5Section or the changes deriving from the election required
6under this Section.
7 (40 ILCS 5/17-116) (from Ch. 108 1/2, par. 17-116)
8 Sec. 17-116. Service retirement pension.
9 (a) Each teacher having 20 years of service upon attainment
10of age 55, or who thereafter attains age 55 shall be entitled
11to a service retirement pension upon or after attainment of age
1255; and each teacher in service on or after July 1, 1971, with
135 or more but less than 20 years of service shall be entitled
14to receive a service retirement pension upon or after
15attainment of age 62.
16 (b) The service retirement pension for a teacher who
17retires on or after June 25, 1971, at age 60 or over, shall be
18calculated as follows:
19 (1) For creditable service earned before July 1, 1998
20 that has not been augmented under Section 17-119.1: 1.67%
21 for each of the first 10 years of service; 1.90% for each
22 of the next 10 years of service; 2.10% for each year of
23 service in excess of 20 but not exceeding 30; and 2.30% for
24 each year of service in excess of 30, based upon average
25 salary as herein defined.

SB2194- 140 -LRB100 12225 RPS 24730 b
1 (2) For creditable service earned on or after July 1,
2 1998 by a member who has at least 30 years of creditable
3 service on July 1, 1998 and who does not elect to augment
4 service under Section 17-119.1: 2.3% of average salary for
5 each year of creditable service earned on or after July 1,
6 1998.
7 (3) For all other creditable service: 2.2% of average
8 salary for each year of creditable service.
9 (c) When computing such service retirement pensions, the
10following conditions shall apply:
11 1. Average salary shall consist of the average annual
12 rate of salary for the 4 consecutive years of validated
13 service within the last 10 years of service when such
14 average annual rate was highest. In the determination of
15 average salary for retirement allowance purposes, for
16 members who commenced employment after August 31, 1979,
17 that part of the salary for any year shall be excluded
18 which exceeds the annual full-time salary rate for the
19 preceding year by more than 20%. In the case of a member
20 who commenced employment before August 31, 1979 and who
21 receives salary during any year after September 1, 1983
22 which exceeds the annual full time salary rate for the
23 preceding year by more than 20%, an Employer and other
24 employers of eligible contributors as defined in Section
25 17-106 shall pay to the Fund an amount equal to the present
26 value of the additional service retirement pension

SB2194- 141 -LRB100 12225 RPS 24730 b
1 resulting from such excess salary. The present value of the
2 additional service retirement pension shall be computed by
3 the Board on the basis of actuarial tables adopted by the
4 Board. If a member elects to receive a pension from this
5 Fund provided by Section 20-121, his salary under the State
6 Universities Retirement System and the Teachers'
7 Retirement System of the State of Illinois shall be
8 considered in determining such average salary. Amounts
9 paid after the effective date of this amendatory Act of
10 1991 for unused vacation time earned after that effective
11 date shall not under any circumstances be included in the
12 calculation of average salary or the annual rate of salary
13 for the purposes of this Article.
14 2. Proportionate credit shall be given for validated
15 service of less than one year.
16 3. For retirement at age 60 or over the pension shall
17 be payable at the full rate.
18 4. For separation from service below age 60 to a
19 minimum age of 55, the pension shall be discounted at the
20 rate of 1/2 of one per cent for each month that the age of
21 the contributor is less than 60, but a teacher may elect to
22 defer the effective date of pension in order to eliminate
23 or reduce this discount. This discount shall not be
24 applicable to any participant who has at least 34 years of
25 service or a retirement pension of at least 74.6% of
26 average salary on the date the retirement annuity begins.

SB2194- 142 -LRB100 12225 RPS 24730 b
1 5. No additional pension shall be granted for service
2 exceeding 45 years. Beginning June 26, 1971 no pension
3 shall exceed the greater of $1,500 per month or 75% of
4 average salary as herein defined.
5 6. Service retirement pensions shall begin on the
6 effective date of resignation, retirement, the day
7 following the close of the payroll period for which service
8 credit was validated, or the time the person resigning or
9 retiring attains age 55, or on a date elected by the
10 teacher, whichever shall be latest; provided that, for a
11 person who first becomes a member after the effective date
12 of this amendatory Act of the 99th General Assembly, the
13 benefit shall not commence more than one year prior to the
14 date of the Fund's receipt of an application for the
15 benefit.
16 7. A member who is eligible to receive a retirement
17 pension of at least 74.6% of average salary and will attain
18 age 55 on or before December 31 during the year which
19 commences on July 1 shall be deemed to attain age 55 on the
20 preceding June 1.
21 8. A member retiring after the effective date of this
22 amendatory Act of 1998 shall receive a pension equal to 75%
23 of average salary if the member is qualified to receive a
24 retirement pension equal to at least 74.6% of average
25 salary under this Article or as proportional annuities
26 under Article 20 of this Code.

SB2194- 143 -LRB100 12225 RPS 24730 b
1 (d) Notwithstanding any other provision of this Section,
2annual salary does not include any future increase in income
3that is offered for service to a Tier 1 employee under this
4Article pursuant to the condition set forth in subsection (c)
5of Section 17-115.5 and accepted under that condition by a Tier
61 employee who has made the election under paragraph (2) of
7subsection (a) of Section 17-115.5.
8 Notwithstanding any other provision of this Section,
9annual salary does not include any consideration payment made
10to a Tier 1 employee.
11(Source: P.A. 99-702, eff. 7-29-16.)
12 (40 ILCS 5/17-119.2 new)
13 Sec. 17-119.2. Automatic annual increases in service
14retirement pension and survivor's pension for certain Tier 1
15employees. Notwithstanding any other provision of this
16Article, for a Tier 1 employee who made the election under
17paragraph (1) of subsection (a) of Section 17-115.5:
18 (1) The initial increase in service retirement pension
19 shall occur on the January 1 occurring either on or after
20 the attainment of age 67 or the fifth anniversary of the
21 pension start date, whichever is earlier.
22 (2) The amount of each automatic annual increase in
23 service retirement pension or survivor's pension occurring
24 on or after the effective date of that election shall be
25 calculated as a percentage of the originally granted

SB2194- 144 -LRB100 12225 RPS 24730 b
1 service retirement pension or survivor's pension, equal to
2 3% or one-half the annual unadjusted percentage increase
3 (but not less than zero) in the consumer price index-u for
4 the 12 months ending with the September preceding each
5 November 1, whichever is less. If the annual unadjusted
6 percentage change in the consumer price index-u for the 12
7 months ending with the September preceding each November 1
8 is zero or there is a decrease, then the annuity shall not
9 be increased.
10 For the purposes of this Section, "consumer price index-u"
11means the index published by the Bureau of Labor Statistics of
12the United States Department of Labor that measures the average
13change in prices of goods and services purchased by all urban
14consumers, United States city average, all items, 1982-84 =
15100. The new amount resulting from each annual adjustment shall
16be determined by the Public Pension Division of the Department
17of Insurance and made available to the Board by November 1 of
18each year.
19 (40 ILCS 5/17-129) (from Ch. 108 1/2, par. 17-129)
20 Sec. 17-129. Employer contributions; deficiency in Fund.
21 (a) If in any fiscal year of the Board of Education ending
22prior to 1997 the total amounts paid to the Fund from the Board
23of Education (other than under this subsection, and other than
24amounts used for making or "picking up" contributions on behalf
25of teachers) and from the State do not equal the total

SB2194- 145 -LRB100 12225 RPS 24730 b
1contributions made by or on behalf of the teachers for such
2year, or if the total income of the Fund in any such fiscal
3year of the Board of Education from all sources is less than
4the total such expenditures by the Fund for such year, the
5Board of Education shall, in the next succeeding year, in
6addition to any other payment to the Fund set apart and
7appropriate from moneys from its tax levy for educational
8purposes, a sum sufficient to remove such deficiency or
9deficiencies, and promptly pay such sum into the Fund in order
10to restore any of the reserves of the Fund that may have been
11so temporarily applied. Any amounts received by the Fund after
12December 4, 1997 from State appropriations, including under
13Section 17-127, shall be a credit against and shall fully
14satisfy any obligation that may have arisen, or be claimed to
15have arisen, under this subsection (a) as a result of any
16deficiency or deficiencies in the fiscal year of the Board of
17Education ending in calendar year 1997.
18 (b) (i) Notwithstanding any other provision of this
19Section, and notwithstanding any prior certification by the
20Board under subsection (c) for fiscal year 2011, the Board of
21Education's total required contribution to the Fund for fiscal
22year 2011 under this Section is $187,000,000.
23 (ii) Notwithstanding any other provision of this Section,
24the Board of Education's total required contribution to the
25Fund for fiscal year 2012 under this Section is $192,000,000.
26 (iii) Notwithstanding any other provision of this Section,

SB2194- 146 -LRB100 12225 RPS 24730 b
1the Board of Education's total required contribution to the
2Fund for fiscal year 2013 under this Section is $196,000,000.
3 (iv) For fiscal years 2014 through 2059, the minimum
4contribution to the Fund to be made by the Board of Education
5in each fiscal year shall be an amount determined by the Fund
6to be sufficient to bring the total assets of the Fund up to
790% of the total actuarial liabilities of the Fund by the end
8of fiscal year 2059. In making these determinations, the
9required Board of Education contribution shall be calculated
10each year as a level percentage of the applicable employee
11payrolls over the years remaining to and including fiscal year
122059 and shall be determined under the projected unit credit
13actuarial cost method.
14 (v) Beginning in fiscal year 2060, the minimum Board of
15Education contribution for each fiscal year shall be the amount
16needed to maintain the total assets of the Fund at 90% of the
17total actuarial liabilities of the Fund.
18 (vi) Notwithstanding any other provision of this
19subsection (b), for any fiscal year, the contribution to the
20Fund from the Board of Education shall not be required to be in
21excess of the amount calculated as needed to maintain the
22assets (or cause the assets to be) at the 90% level by the end
23of the fiscal year.
24 (vii) Any contribution by the State to or for the benefit
25of the Fund, including, without limitation, as referred to
26under Section 17-127, shall be a credit against any

SB2194- 147 -LRB100 12225 RPS 24730 b
1contribution required to be made by the Board of Education
2under this subsection (b).
3 (c) The Board shall determine the amount of Board of
4Education contributions required for each fiscal year on the
5basis of the actuarial tables and other assumptions adopted by
6the Board and the recommendations of the actuary, in order to
7meet the minimum contribution requirements of subsections (a)
8and (b). Annually, on or before February 28, the Board shall
9certify to the Board of Education the amount of the required
10Board of Education contribution for the coming fiscal year. The
11certification shall include a copy of the actuarial
12recommendations upon which it is based.
13 (d) On or before May 1, 2018, the Board shall recalculate
14and recertify to the Board of Education the amount of the
15required Board of Education contribution to the Fund for fiscal
16year 2019, taking into account the effect on the Fund's
17liabilities of the elections made under Section 17-115.5.
18(Source: P.A. 96-889, eff. 4-14-10.)
19 (40 ILCS 5/17-130) (from Ch. 108 1/2, par. 17-130)
20 Sec. 17-130. Participants' contributions by payroll
21deductions.
22 (a) Except as provided in subsection (a-5), there There
23shall be deducted from the salary of each teacher 7.50% of his
24salary for service or disability retirement pension and 0.5% of
25salary for the annual increase in base pension.

SB2194- 148 -LRB100 12225 RPS 24730 b
1 In addition, there shall be deducted from the salary of
2each teacher 1% of his salary for survivors' and children's
3pensions.
4 (a-5) Beginning on July 1, 2018 or the effective date of
5the Tier 1 employee's election under paragraph (1) of Section
617-115.5, whichever is later, in lieu of the contributions
7otherwise required under subsection (a), each Tier 1 employee
8who made the election under paragraph (1) of Section 17-115.5
9shall make contributions of 7.50% of salary for service or
10disability retirement pension and 0.6% of salary for survivors'
11and children's pensions.
12 (b) An Employer and any employer of eligible contributors
13as defined in Section 17-106 is authorized to make the
14necessary deductions from the salaries of its teachers. Such
15amounts shall be included as a part of the Fund. An Employer
16and any employer of eligible contributors as defined in Section
1717-106 shall formulate such rules and regulations as may be
18necessary to give effect to the provisions of this Section.
19 (c) All persons employed as teachers shall, by such
20employment, accept the provisions of this Article and of
21Sections 34-83 to 34-85, inclusive, of "The School Code",
22approved March 18, 1961, as amended, and thereupon become
23contributors to the Fund in accordance with the terms thereof.
24The provisions of this Article and of those Sections shall
25become a part of the contract of employment.
26 (d) A person who (i) was a member before July 1, 1998, (ii)

SB2194- 149 -LRB100 12225 RPS 24730 b
1retires with more than 34 years of creditable service, and
2(iii) does not elect to qualify for the augmented rate under
3Section 17-119.1 shall be entitled, at the time of retirement,
4to receive a partial refund of contributions made under this
5Section for service occurring after the later of June 30, 1998
6or attainment of 34 years of creditable service, in an amount
7equal to 1.00% of the salary upon which those contributions
8were based.
9(Source: P.A. 97-8, eff. 6-13-11.)
10 Section 40. The State Pension Funds Continuing
11Appropriation Act is amended by adding Section 1.9 as follows:
12 (40 ILCS 15/1.9 new)
13 Sec. 1.9. Appropriation for consideration payment. There
14is hereby appropriated from the General Revenue Fund to the
15State Comptroller, on a continuing basis, all amounts necessary
16for the payment of consideration payments under subsection (b)
17of Sections 14-106.5, 15-132.9, 16-122.9, and 17-115.5 of the
18Illinois Pension Code, in the amounts certified to the State
19Comptroller by the respective retirement system or pension
20fund.
21 Section 45. The School Code is amended by changing Sections
2224-1, 24-8, and 34-18.53 as follows:

SB2194- 150 -LRB100 12225 RPS 24730 b
1 (105 ILCS 5/24-1) (from Ch. 122, par. 24-1)
2 Sec. 24-1. Appointment-Salaries-Payment-School
3month-School term.) School boards shall appoint all teachers,
4determine qualifications of employment and fix the amount of
5their salaries subject to any limitation set forth in this Act
6and subject to any applicable restrictions in Section 16-122.9
7of the Illinois Pension Code. They shall pay the wages of
8teachers monthly, subject, however, to the provisions of
9Section 24-21. The school month shall be the same as the
10calendar month but by resolution the school board may adopt for
11its use a month of 20 days, including holidays. The school term
12shall consist of at least the minimum number of pupil
13attendance days required by Section 10-19, any additional legal
14school holidays, days of teachers' institutes, or equivalent
15professional educational experiences, and one or two days at
16the beginning of the school term when used as a teachers'
17workshop.
18(Source: P.A. 80-249.)
19 (105 ILCS 5/24-8) (from Ch. 122, par. 24-8)
20 Sec. 24-8. Minimum salary. In fixing the salaries of
21teachers, school boards shall pay those who serve on a
22full-time basis not less than a rate for the school year that
23is based upon training completed in a recognized institution of
24higher learning, as follows: for the school year beginning July
251, 1980 and thereafter, less than a bachelor's degree, $9,000;

SB2194- 151 -LRB100 12225 RPS 24730 b
1120 semester hours or more and a bachelor's degree, $10,000;
2150 semester hours or more and a master's degree, $11,000.
3 Based upon previous public school experience in this State
4or any other State, territory, dependency or possession of the
5United States, or in schools operated by or under the auspices
6of the United States, teachers who serve on a full-time basis
7shall have their salaries increased to at least the following
8amounts above the starting salary for a teacher in such
9district in the same classification: with less than a
10bachelor's degree, $750 after 5 years; with 120 semester hours
11or more and a bachelor's degree, $1,000 after 5 years and
12$1,600 after 8 years; with 150 semester hours or more and a
13master's degree, $1,250 after 5 years, $2,000 after 8 years and
14$2,750 after 13 years. However, any salary increase is subject
15to any applicable restrictions in Section 16-122.9 of the
16Illinois Pension Code.
17 For the purpose of this Section a teacher's salary shall
18include any amount paid by the school district on behalf of the
19teacher, as teacher contributions, to the Teachers' Retirement
20System of the State of Illinois.
21 If a school board establishes a schedule for teachers'
22salaries based on education and experience, not inconsistent
23with this Section, all certificated nurses employed by that
24board shall be paid in accordance with the provisions of such
25schedule (subject to any applicable restrictions in Section
2616-122.9 of the Illinois Pension Code).

SB2194- 152 -LRB100 12225 RPS 24730 b
1 For purposes of this Section, a teacher who submits a
2certificate of completion to the school office prior to the
3first day of the school term shall be considered to have the
4degree stated in such certificate.
5(Source: P.A. 83-913.)
6 (105 ILCS 5/34-18.53 new)
7 Sec. 34-18.53. Future increase in income. The Board of
8Education must not pay, offer, or agree to pay any future
9increase in income, as that term is defined in Section 17-113.5
10of the Illinois Pension Code, to any person in a manner that
11violates Section 17-115.5 of the Illinois Pension Code.
12 Section 50. The State Universities Civil Service Act is
13amended by changing Section 36d as follows:
14 (110 ILCS 70/36d) (from Ch. 24 1/2, par. 38b3)
15 Sec. 36d. Powers and duties of the Merit Board. The Merit
16Board shall have the power and duty-
17 (1) To approve a classification plan prepared under its
18 direction, assigning to each class positions of
19 substantially similar duties. The Merit Board shall have
20 power to delegate to its Director the duty of assigning
21 each position in the classified service to the appropriate
22 class in the classification plan approved by the Merit
23 Board.

SB2194- 153 -LRB100 12225 RPS 24730 b
1 (2) To prescribe the duties of each class of positions
2 and the qualifications required by employment in that
3 class.
4 (3) To prescribe the range of compensation for each
5 class or to fix a single rate of compensation for employees
6 in a particular class; and to establish other conditions of
7 employment which an employer and employee representatives
8 have agreed upon as fair and equitable. The Merit Board
9 shall direct the payment of the "prevailing rate of wages"
10 in those classifications in which, on January 1, 1952, any
11 employer is paying such prevailing rate and in such other
12 classes as the Merit Board may thereafter determine.
13 "Prevailing rate of wages" as used herein shall be the
14 wages paid generally in the locality in which the work is
15 being performed to employees engaged in work of a similar
16 character. Subject to any applicable restrictions in
17 Section 14-106.5, 15-132.9, or 16-122.9 of the Illinois
18 Pension Code, each Each employer covered by the University
19 System shall be authorized to negotiate with
20 representatives of employees to determine appropriate
21 ranges or rates of compensation or other conditions of
22 employment and may recommend to the Merit Board for
23 establishment the rates or ranges or other conditions of
24 employment which the employer and employee representatives
25 have agreed upon as fair and equitable, but excluding the
26 changes, the impact of changes, and the implementation of

SB2194- 154 -LRB100 12225 RPS 24730 b
1 the changes set forth in this amendatory Act of the 100th
2 General Assembly. Any rates or ranges established prior to
3 January 1, 1952, and hereafter, shall not be changed except
4 in accordance with the procedures herein provided.
5 (4) To recommend to the institutions and agencies
6 specified in Section 36e standards for hours of work,
7 holidays, sick leave, overtime compensation and vacation
8 for the purpose of improving conditions of employment
9 covered therein and for the purpose of insuring conformity
10 with the prevailing rate principal.
11 (5) To prescribe standards of examination for each
12 class, the examinations to be related to the duties of such
13 class. The Merit Board shall have power to delegate to the
14 Director and his staff the preparation, conduct and grading
15 of examinations. Examinations may be written, oral, by
16 statement of training and experience, in the form of tests
17 of knowledge, skill, capacity, intellect, aptitude; or, by
18 any other method, which in the judgment of the Merit Board
19 is reasonable and practical for any particular
20 classification. Different examining procedures may be
21 determined for the examinations in different
22 classifications but all examinations in the same
23 classification shall be uniform.
24 (6) To authorize the continuous recruitment of
25 personnel and to that end, to delegate to the Director and
26 his staff the power and the duty to conduct open and

SB2194- 155 -LRB100 12225 RPS 24730 b
1 continuous competitive examinations for all
2 classifications of employment.
3 (7) To cause to be established from the results of
4 examinations registers for each class of positions in the
5 classified service of the State Universities Civil Service
6 System, of the persons who shall attain the minimum mark
7 fixed by the Merit Board for the examination; and such
8 persons shall take rank upon the registers as candidates in
9 the order of their relative excellence as determined by
10 examination, without reference to priority of time of
11 examination.
12 (8) To provide by its rules for promotions in the
13 classified service. Vacancies shall be filled by promotion
14 whenever practicable. For the purpose of this paragraph, an
15 advancement in class shall constitute a promotion.
16 (9) To set a probationary period of employment of no
17 less than 6 months and no longer than 12 months for each
18 class of positions in the classification plan, the length
19 of the probationary period for each class to be determined
20 by the Director.
21 (10) To provide by its rules for employment at regular
22 rates of compensation of persons with physical
23 disabilities in positions in which the disability does not
24 prevent the individual from furnishing satisfactory
25 service.
26 (11) To make and publish rules, to carry out the

SB2194- 156 -LRB100 12225 RPS 24730 b
1 purpose of the State Universities Civil Service System and
2 for examination, appointments, transfers and removals and
3 for maintaining and keeping records of the efficiency of
4 officers and employees and groups of officers and employees
5 in accordance with the provisions of Sections 36b to 36q,
6 inclusive, and said Merit Board may from time to time make
7 changes in such rules.
8 (12) To appoint a Director and such assistants and
9 other clerical and technical help as may be necessary
10 efficiently to administer Sections 36b to 36q, inclusive.
11 To authorize the Director to appoint an assistant resident
12 at the place of employment of each employer specified in
13 Section 36e and this assistant may be authorized to give
14 examinations and to certify names from the regional
15 registers provided in Section 36k.
16 (13) To submit to the Governor of this state on or
17 before November 1 of each year prior to the regular session
18 of the General Assembly a report of the University System's
19 business and an estimate of the amount of appropriation
20 from state funds required for the purpose of administering
21 the University System.
22(Source: P.A. 99-143, eff. 7-27-15.)
23 Section 55. The University of Illinois Act is amended by
24adding Section 100 as follows:

SB2194- 157 -LRB100 12225 RPS 24730 b
1 (110 ILCS 305/100 new)
2 Sec. 100. Future increases in income. The University of
3Illinois must not pay, offer, or agree to pay any future
4increase in income, as that term is defined in Section
514-103.42, 15-112.1, or 16-121.1 of the Illinois Pension Code,
6to any person in a manner that violates Section 14-106.5,
715-132.9, or 16-122.9 of the Illinois Pension Code.
8 Section 65. The Southern Illinois University Management
9Act is amended by adding Section 85 as follows:
10 (110 ILCS 520/85 new)
11 Sec. 85. Future increases in income. Southern Illinois
12University must not pay, offer, or agree to pay any future
13increase in income, as that term is defined in Section
1414-103.42, 15-112.1, or 16-121.1 of the Illinois Pension Code,
15to any person in a manner that violates Section 14-106.5,
1615-132.9, or 16-122.9 of the Illinois Pension Code.
17 Section 70. The Chicago State University Law is amended by
18adding Section 5-195 as follows:
19 (110 ILCS 660/5-195 new)
20 Sec. 5-195. Future increases in income. Chicago State
21University must not pay, offer, or agree to pay any future
22increase in income, as that term is defined in Section

SB2194- 158 -LRB100 12225 RPS 24730 b
114-103.42, 15-112.1, or 16-121.1 of the Illinois Pension Code,
2to any person in a manner that violates Section 14-106.5,
315-132.9, or 16-122.9 of the Illinois Pension Code.
4 Section 75. The Eastern Illinois University Law is amended
5by adding Section 10-195 as follows:
6 (110 ILCS 665/10-195 new)
7 Sec. 10-195. Future increases in income. Eastern Illinois
8University must not pay, offer, or agree to pay any future
9increase in income, as that term is defined in Section
1014-103.42, 15-112.1, or 16-121.1 of the Illinois Pension Code,
11to any person in a manner that violates Section 14-106.5,
1215-132.9, or 16-122.9 of the Illinois Pension Code.
13 Section 80. The Governors State University Law is amended
14by adding Section 15-195 as follows:
15 (110 ILCS 670/15-195 new)
16 Sec. 15-195. Future increases in income. Governors State
17University must not pay, offer, or agree to pay any future
18increase in income, as that term is defined in Section
1914-103.42, 15-112.1, or 16-121.1 of the Illinois Pension Code,
20to any person in a manner that violates Section 14-106.5,
2115-132.9, or 16-122.9 of the Illinois Pension Code.

SB2194- 159 -LRB100 12225 RPS 24730 b
1 Section 85. The Illinois State University Law is amended by
2adding Section 20-200 as follows:
3 (110 ILCS 675/20-200 new)
4 Sec. 20-200. Future increases in income. Illinois State
5University must not pay, offer, or agree to pay any future
6increase in income, as that term is defined in Section
714-103.42, 15-112.1, or 16-121.1 of the Illinois Pension Code,
8to any person in a manner that violates Section 14-106.5,
915-132.9, or 16-122.9 of the Illinois Pension Code.
10 Section 90. The Northeastern Illinois University Law is
11amended by adding Section 25-195 as follows:
12 (110 ILCS 680/25-195 new)
13 Sec. 25-195. Future increases in income. Northeastern
14Illinois University must not pay, offer, or agree to pay any
15future increase in income, as that term is defined in Section
1614-103.42, 15-112.1, or 16-121.1 of the Illinois Pension Code,
17to any person in a manner that violates Section 14-106.5,
1815-132.9, or 16-122.9 of the Illinois Pension Code.
19 Section 95. The Northern Illinois University Law is amended
20by adding Section 30-205 as follows:
21 (110 ILCS 685/30-205 new)

SB2194- 160 -LRB100 12225 RPS 24730 b
1 Sec. 30-205. Future increases in income. Northern Illinois
2University must not pay, offer, or agree to pay any future
3increase in income, as that term is defined in Section
414-103.42, 15-112.1, or 16-121.1 of the Illinois Pension Code,
5to any person in a manner that violates Section 14-106.5,
615-132.9, or 16-122.9 of the Illinois Pension Code.
7 Section 100. The Western Illinois University Law is amended
8by adding Section 35-200 as follows:
9 (110 ILCS 690/35-200 new)
10 Sec. 35-200. Future increases in income. Western Illinois
11University must not pay, offer, or agree to pay any future
12increase in income, as that term is defined in Section
1314-103.42, 15-112.1, or 16-121.1 of the Illinois Pension Code,
14to any person in a manner that violates Section 14-106.5,
1515-132.9, or 16-122.9 of the Illinois Pension Code.
16 Section 105. The Public Community College Act is amended by
17changing Sections 3-26 and 3-42 as follows:
18 (110 ILCS 805/3-26) (from Ch. 122, par. 103-26)
19 Sec. 3-26. (a) To make appointments and fix the salaries of
20a chief administrative officer, who shall be the executive
21officer of the board, other administrative personnel, and all
22teachers, but subject to any applicable restrictions in Section

SB2194- 161 -LRB100 12225 RPS 24730 b
114-106.5, 15-132.9, or 16-122.9 of the Illinois Pension Code.
2In making these appointments and fixing the salaries, the board
3may make no discrimination on account of sex, race, creed,
4color or national origin.
5 (b) Upon the written request of an employee, to withhold
6from the compensation of that employee the membership dues of
7such employee payable to any specified labor organization as
8defined in the Illinois Educational Labor Relations Act. Under
9such arrangement, an amount shall be withheld for each regular
10payroll period which is equal to the prorata share of the
11annual membership dues plus any payments or contributions and
12the board shall pay such withholding to the specified labor
13organization within 10 working days from the time of the
14withholding.
15(Source: P.A. 83-1014.)
16 (110 ILCS 805/3-42) (from Ch. 122, par. 103-42)
17 Sec. 3-42. To employ such personnel as may be needed, to
18establish policies governing their employment and dismissal,
19and to fix the amount of their compensation, subject to any
20applicable restrictions in Section 14-106.5, 15-132.9, or
2116-122.9 of the Illinois Pension Code. In the employment,
22establishment of policies and fixing of compensation the board
23may make no discrimination on account of sex, race, creed,
24color or national origin.
25 Residence within any community college district or outside

SB2194- 162 -LRB100 12225 RPS 24730 b
1any community college district shall not be considered:
2 (a) in determining whether to retain or not retain any
3 employee of a community college employed prior to July 1,
4 1977 or prior to the adoption by the community college
5 board of a resolution making residency within the community
6 college district of some or all employees a condition of
7 employment, whichever is later;
8 (b) in assigning, promoting or transferring any
9 employee of a community college to an office or position
10 employed prior to July 1, 1977 or prior to the adoption by
11 the community college board of a resolution making
12 residency within the community college district of some or
13 all employees a condition of employment, whichever is
14 later; or
15 (c) in determining the salary or other compensation of
16 any employee of a community college.
17(Source: P.A. 80-248.)
18 Section 110. The Illinois Educational Labor Relations Act
19is amended by changing Sections 4, 14, and 17 and by adding
20Section 10.6 as follows:
21 (115 ILCS 5/4) (from Ch. 48, par. 1704)
22 Sec. 4. Employer rights. Employers shall not be required to
23bargain over matters of inherent managerial policy, which shall
24include such areas of discretion or policy as the functions of

SB2194- 163 -LRB100 12225 RPS 24730 b
1the employer, standards of services, its overall budget, the
2organizational structure and selection of new employees and
3direction of employees. Employers, however, shall be required
4to bargain collectively with regard to policy matters directly
5affecting wages (but subject to any applicable restrictions in
6Section 14-106.5, 15-132.9, 16-122.9, or 17-115.5 of the
7Illinois Pension Code), hours and terms and conditions of
8employment as well as the impact thereon upon request by
9employee representatives, but excluding the changes, the
10impact of changes, and the implementation of the changes set
11forth in Section 14-106.5, 15-132.9, 16-122.9, or 17-115.5 of
12the Illinois Pension Code. To preserve the rights of employers
13and exclusive representatives which have established
14collective bargaining relationships or negotiated collective
15bargaining agreements prior to the effective date of this Act,
16employers shall be required to bargain collectively with regard
17to any matter concerning wages (but subject to any applicable
18restrictions in Section 14-106.5, 15-132.9, 16-122.9, or
1917-115.5 of the Illinois Pension Code), hours or conditions of
20employment about which they have bargained for and agreed to in
21a collective bargaining agreement prior to the effective date
22of this Act, but excluding the changes, the impact of changes,
23and the implementation of the changes set forth in Section
2414-106.5, 15-132.9, 16-122.9, or 17-115.5 of the Illinois
25Pension Code.
26(Source: P.A. 83-1014.)

SB2194- 164 -LRB100 12225 RPS 24730 b
1 (115 ILCS 5/10.6 new)
2 Sec. 10.6. No collective bargaining or interest
3arbitration regarding certain changes to the Illinois Pension
4Code.
5 (a) Notwithstanding any other provision of this Act,
6employers shall not be required to bargain over matters
7affected by the changes, the impact of the changes, and the
8implementation of the changes to Article 14, 15, 16, or 17 of
9the Illinois Pension Code made by the addition of Section
1014-106.5, 15-132.9, 16-122.9, or 17-115.5 of the Illinois
11Pension Code, which are deemed to be prohibited subjects of
12bargaining. Notwithstanding any provision of this Act, the
13changes, impact of the changes, or implementation of the
14changes to Article 14, 15, 16, or 17 of the Illinois Pension
15Code made by the addition of Section 14-106.5, 15-132.9,
1616-122.9, or 17-115.5 of the Illinois Pension Code shall not be
17subject to interest arbitration or any award issued pursuant to
18interest arbitration. The provisions of this Section shall not
19apply to an employment contract or collective bargaining
20agreement that is in effect on the effective date of this
21amendatory Act of the 100th General Assembly. However, any such
22contract or agreement that is modified, amended, renewed, or
23superseded after the effective date of this amendatory Act of
24the 100th General Assembly shall be subject to the provisions
25of this Section. The provisions of this Section shall not apply

SB2194- 165 -LRB100 12225 RPS 24730 b
1to the ability of any employer and employee representative to
2bargain collectively with regard to the pick up of employee
3contributions pursuant to Section 14-133.1, 15-157.1,
416-152.1, 17-130.1, or 17-130.2 of the Illinois Pension Code.
5 (b) Nothing in this Section shall be construed as otherwise
6limiting any of the obligations and requirements applicable to
7employers under any of the provisions of this Act, including,
8but not limited to, the requirement to bargain collectively
9with regard to policy matters directly affecting wages, hours,
10and terms and conditions of employment as well as the impact
11thereon upon request by employee representatives, except for
12the matters set forth in subsection (a) of this Section that
13are deemed prohibited subjects of bargaining. Nothing in this
14Section shall be construed as otherwise limiting any of the
15rights of employees or employee representatives under the
16provisions of this Act, except for the matters set forth in
17subsection (a) of this Section that are deemed prohibited
18subjects of bargaining.
19 (c) In case of any conflict between this Section and any
20other provisions of this Act or any other law, the provisions
21of this Section shall control.
22 (115 ILCS 5/14) (from Ch. 48, par. 1714)
23 Sec. 14. Unfair labor practices.
24 (a) Educational employers, their agents or representatives
25are prohibited from:

SB2194- 166 -LRB100 12225 RPS 24730 b
1 (1) Interfering, restraining or coercing employees in
2 the exercise of the rights guaranteed under this Act.
3 (2) Dominating or interfering with the formation,
4 existence or administration of any employee organization.
5 (3) Discriminating in regard to hire or tenure of
6 employment or any term or condition of employment to
7 encourage or discourage membership in any employee
8 organization.
9 (4) Discharging or otherwise discriminating against an
10 employee because he or she has signed or filed an
11 affidavit, authorization card, petition or complaint or
12 given any information or testimony under this Act.
13 (5) Subject to and except as provided in Section 10.6,
14 refusing Refusing to bargain collectively in good faith
15 with an employee representative which is the exclusive
16 representative of employees in an appropriate unit,
17 including but not limited to the discussing of grievances
18 with the exclusive representative; provided, however, that
19 if an alleged unfair labor practice involves
20 interpretation or application of the terms of a collective
21 bargaining agreement and said agreement contains a
22 grievance and arbitration procedure, the Board may defer
23 the resolution of such dispute to the grievance and
24 arbitration procedure contained in said agreement.
25 However, no actions of the employer taken to implement or
26 otherwise comply with the provisions of subsection (a) of

SB2194- 167 -LRB100 12225 RPS 24730 b
1 Section 10.6 shall constitute or give rise to an unfair
2 labor practice under this Act.
3 (6) Refusing to reduce a collective bargaining
4 agreement to writing and signing such agreement.
5 (7) Violating any of the rules and regulations
6 promulgated by the Board regulating the conduct of
7 representation elections.
8 (8) Refusing to comply with the provisions of a binding
9 arbitration award.
10 (9) Expending or causing the expenditure of public
11 funds to any external agent, individual, firm, agency,
12 partnership or association in any attempt to influence the
13 outcome of representational elections held pursuant to
14 paragraph (c) of Section 7 of this Act; provided, that
15 nothing in this subsection shall be construed to limit an
16 employer's right to be represented on any matter pertaining
17 to unit determinations, unfair labor practice charges or
18 pre-election conferences in any formal or informal
19 proceeding before the Board, or to seek or obtain advice
20 from legal counsel. Nothing in this paragraph shall be
21 construed to prohibit an employer from expending or causing
22 the expenditure of public funds on, or seeking or obtaining
23 services or advice from, any organization, group or
24 association established by, and including educational or
25 public employers, whether or not covered by this Act, the
26 Illinois Public Labor Relations Act or the public

SB2194- 168 -LRB100 12225 RPS 24730 b
1 employment labor relations law of any other state or the
2 federal government, provided that such services or advice
3 are generally available to the membership of the
4 organization, group, or association, and are not offered
5 solely in an attempt to influence the outcome of a
6 particular representational election.
7 (b) Employee organizations, their agents or
8representatives or educational employees are prohibited from:
9 (1) Restraining or coercing employees in the exercise
10 of the rights guaranteed under this Act, provided that a
11 labor organization or its agents shall commit an unfair
12 labor practice under this paragraph in duty of fair
13 representation cases only by intentional misconduct in
14 representing employees under this Act.
15 (2) Restraining or coercing an educational employer in
16 the selection of his representative for the purposes of
17 collective bargaining or the adjustment of grievances.
18 (3) Refusing to bargain collectively in good faith with
19 an educational employer, if they have been designated in
20 accordance with the provisions of this Act as the exclusive
21 representative of employees in an appropriate unit.
22 (4) Violating any of the rules and regulations
23 promulgated by the Board regulating the conduct of
24 representation elections.
25 (5) Refusing to reduce a collective bargaining
26 agreement to writing and signing such agreement.

SB2194- 169 -LRB100 12225 RPS 24730 b
1 (6) Refusing to comply with the provisions of a binding
2 arbitration award.
3 (c) The expressing of any views, argument, opinion or the
4dissemination thereof, whether in written, printed, graphic or
5visual form, shall not constitute or be evidence of an unfair
6labor practice under any of the provisions of this Act, if such
7expression contains no threat of reprisal or force or promise
8of benefit.
9 (d) The actions of a Financial Oversight Panel created
10pursuant to Section 1A-8 of the School Code due to a district
11violating a financial plan shall not constitute or be evidence
12of an unfair labor practice under any of the provisions of this
13Act. Such actions include, but are not limited to, reviewing,
14approving, or rejecting a school district budget or a
15collective bargaining agreement.
16(Source: P.A. 89-572, eff. 7-30-96.)
17 (115 ILCS 5/17) (from Ch. 48, par. 1717)
18 Sec. 17. Effect on other laws. In case of any conflict
19between the provisions of this Act and any other law (other
20than Section 14-106.5, 15-132.9, 16-122.9, or 17-115.5 of the
21Illinois Pension Code), executive order or administrative
22regulation, the provisions of this Act shall prevail and
23control. The provisions of this Act are subject to any
24applicable restrictions in Section 14-106.5, 15-132.9,
2516-122.9, or 17-115.5 of the Illinois Pension Code, as well as

SB2194- 170 -LRB100 12225 RPS 24730 b
1the changes, impact of changes, and implementation of changes
2set forth in Section 14-106.5, 15-132.9, 16-122.9, or 17-115.5
3of the Illinois Pension Code. Nothing in this Act shall be
4construed to replace or diminish the rights of employees
5established by Section 36d of "An Act to create the State
6Universities Civil Service System", approved May 11, 1905, as
7amended or modified.
8(Source: P.A. 83-1014.)
9 Section 900. The State Mandates Act is amended by adding
10Section 8.41 as follows:
11 (30 ILCS 805/8.41 new)
12 Sec. 8.41. Exempt mandate. Notwithstanding Sections 6 and 8
13of this Act, no reimbursement by the State is required for the
14implementation of any mandate created by this amendatory Act of
15the 100th General Assembly.
16 Section 970. Severability. Except as otherwise provided in
17this Act, the provisions of this Act are severable under
18Section 1.31 of the Statute on Statutes.
19 Section 999. Effective date. This Act takes effect upon
20becoming law.

SB2194- 171 -LRB100 12225 RPS 24730 b
1 INDEX
2 Statutes amended in order of appearance
3 5 ILCS 315/7.6 new
4 5 ILCS 315/10from Ch. 48, par. 1610
5 5 ILCS 315/15from Ch. 48, par. 1615
6 15 ILCS 205/5 new
7 15 ILCS 310/13a new
8 15 ILCS 410/13a new
9 15 ILCS 510/12a new
10 20 ILCS 5/5-647 new
11 40 ILCS 5/14-103.10from Ch. 108 1/2, par. 14-103.10
12 40 ILCS 5/14-103.41 new
13 40 ILCS 5/14-103.42 new
14 40 ILCS 5/14-103.43 new
15 40 ILCS 5/14-106.5 new
16 40 ILCS 5/14-114from Ch. 108 1/2, par. 14-114
17 40 ILCS 5/14-131
18 40 ILCS 5/14-133from Ch. 108 1/2, par. 14-133
19 40 ILCS 5/14-135.08from Ch. 108 1/2, par. 14-135.08
20 40 ILCS 5/14-152.1
21 40 ILCS 5/15-108.1
22 40 ILCS 5/15-111from Ch. 108 1/2, par. 15-111
23 40 ILCS 5/15-112.1 new
24 40 ILCS 5/15-112.2 new
25 40 ILCS 5/15-132.9 new

SB2194- 172 -LRB100 12225 RPS 24730 b
1 40 ILCS 5/15-136from Ch. 108 1/2, par. 15-136
2 40 ILCS 5/15-155from Ch. 108 1/2, par. 15-155
3 40 ILCS 5/15-157from Ch. 108 1/2, par. 15-157
4 40 ILCS 5/15-165from Ch. 108 1/2, par. 15-165
5 40 ILCS 5/15-198
6 40 ILCS 5/16-107.1 new
7 40 ILCS 5/16-121from Ch. 108 1/2, par. 16-121
8 40 ILCS 5/16-121.1 new
9 40 ILCS 5/16-121.2 new
10 40 ILCS 5/16-122.9 new
11 40 ILCS 5/16-133.1from Ch. 108 1/2, par. 16-133.1
12 40 ILCS 5/16-136.1from Ch. 108 1/2, par. 16-136.1
13 40 ILCS 5/16-152from Ch. 108 1/2, par. 16-152
14 40 ILCS 5/16-158from Ch. 108 1/2, par. 16-158
15 40 ILCS 5/16-203
16 40 ILCS 5/17-106.05 new
17 40 ILCS 5/17-113.4 new
18 40 ILCS 5/17-113.5 new
19 40 ILCS 5/17-113.6 new
20 40 ILCS 5/17-115.5 new
21 40 ILCS 5/17-116from Ch. 108 1/2, par. 17-116
22 40 ILCS 5/17-119.2 new
23 40 ILCS 5/17-129from Ch. 108 1/2, par. 17-129
24 40 ILCS 5/17-130from Ch. 108 1/2, par. 17-130
25 40 ILCS 15/1.9 new
26 105 ILCS 5/24-1from Ch. 122, par. 24-1

SB2194- 173 -LRB100 12225 RPS 24730 b