Bill Amendment: IL HB0751 | 2017-2018 | 100th General Assembly

NOTE: For additional amemendments please see the Bill Drafting List

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Bill Title: PEN CD-DOWNST TEACHER-SHORTAGE

Status: 2018-08-10 - Public Act . . . . . . . . . 100-0743 [HB0751 Detail]

Download: Illinois-2017-HB0751-Senate_Amendment_002.html

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Sen. William R. Haine

Filed: 5/16/2018

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AMENDMENT TO HOUSE BILL 751
AMENDMENT NO. ______. Amend House Bill 751 on page 1, line
5, by replacing "16-150.1 and" with "7-141.1, 16-150.1, and";
and
on page 1, immediately below line 5, by inserting the
following:
"(40 ILCS 5/7-141.1)
Sec. 7-141.1. Early retirement incentive.
(a) The General Assembly finds and declares that:
(1) Units of local government across the State have
been functioning under a financial crisis.
(2) This financial crisis is expected to continue.
(3) Units of local government must depend on additional
sources of revenue and, when those sources are not
forthcoming, must establish cost-saving programs.
(4) An early retirement incentive designed

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specifically to target highly-paid senior employees could
result in significant annual cost savings.
(5) The early retirement incentive should be made
available only to those units of local government that
determine that an early retirement incentive is in their
best interest.
(6) A unit of local government adopting a program of
early retirement incentives under this Section is
encouraged to implement personnel procedures to prohibit,
for at least 5 years, the rehiring (whether on payroll or
by independent contract) of employees who receive early
retirement incentives.
(7) A unit of local government adopting a program of
early retirement incentives under this Section is also
encouraged to replace as few of the participating employees
as possible and to hire replacement employees for salaries
totaling no more than 80% of the total salaries formerly
paid to the employees who participate in the early
retirement program.
It is the primary purpose of this Section to encourage
units of local government that can realize true cost savings,
or have determined that an early retirement program is in their
best interest, to implement an early retirement program.
(b) Until the effective date of this amendatory Act of
1997, this Section does not apply to any employer that is a
city, village, or incorporated town, nor to the employees of

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any such employer. Beginning on the effective date of this
amendatory Act of 1997, any employer under this Article,
including an employer that is a city, village, or incorporated
town, may establish an early retirement incentive program for
its employees under this Section. The decision of a city,
village, or incorporated town to consider or establish an early
retirement program is at the sole discretion of that city,
village, or incorporated town, and nothing in this amendatory
Act of 1997 limits or otherwise diminishes this discretion.
Nothing contained in this Section shall be construed to require
a city, village, or incorporated town to establish an early
retirement program and no city, village, or incorporated town
may be compelled to implement such a program.
The benefits provided in this Section are available only to
members employed by a participating employer that has filed
with the Board of the Fund a resolution or ordinance expressly
providing for the creation of an early retirement incentive
program under this Section for its employees and specifying the
effective date of the early retirement incentive program.
Subject to the limitation in subsection (h), an employer may
adopt a resolution or ordinance providing a program of early
retirement incentives under this Section at any time.
The resolution or ordinance shall be in substantially the
following form:
RESOLUTION (ORDINANCE) NO. ....

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A RESOLUTION (ORDINANCE) ADOPTING AN EARLY
RETIREMENT INCENTIVE PROGRAM FOR EMPLOYEES
IN THE ILLINOIS MUNICIPAL RETIREMENT FUND
WHEREAS, Section 7-141.1 of the Illinois Pension Code
provides that a participating employer may elect to adopt an
early retirement incentive program offered by the Illinois
Municipal Retirement Fund by adopting a resolution or
ordinance; and
WHEREAS, The goal of adopting an early retirement program
is to realize a substantial savings in personnel costs by
offering early retirement incentives to employees who have
accumulated many years of service credit; and
WHEREAS, Implementation of the early retirement program
will provide a budgeting tool to aid in controlling payroll
costs; and
WHEREAS, The (name of governing body) has determined that
the adoption of an early retirement incentive program is in the
best interests of the (name of participating employer);
therefore be it
RESOLVED (ORDAINED) by the (name of governing body) of
(name of participating employer) that:
(1) The (name of participating employer) does hereby adopt
the Illinois Municipal Retirement Fund early retirement
incentive program as provided in Section 7-141.1 of the
Illinois Pension Code. The early retirement incentive program
shall take effect on (date).

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(2) In order to help achieve a true cost savings, a person
who retires under the early retirement incentive program shall
lose those incentives if he or she later accepts employment
with any IMRF employer in a position for which participation in
IMRF is required or is elected by the employee.
(3) In order to utilize an early retirement incentive as a
budgeting tool, the (name of participating employer) will use
its best efforts either to limit the number of employees who
replace the employees who retire under the early retirement
program or to limit the salaries paid to the employees who
replace the employees who retire under the early retirement
program.
(4) The effective date of each employee's retirement under
this early retirement program shall be set by (name of
employer) and shall be no earlier than the effective date of
the program and no later than one year after that effective
date; except that the employee may require that the retirement
date set by the employer be no later than the June 30 next
occurring after the effective date of the program and no
earlier than the date upon which the employee qualifies for
retirement.
(5) To be eligible for the early retirement incentive under
this Section, the employee must have attained age 50 and have
at least 20 years of creditable service by his or her
retirement date.
(6) The (clerk or secretary) shall promptly file a

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certified copy of this resolution (ordinance) with the Board of
Trustees of the Illinois Municipal Retirement Fund.
CERTIFICATION
I, (name), the (clerk or secretary) of the (name of
participating employer) of the County of (name), State of
Illinois, do hereby certify that I am the keeper of the books
and records of the (name of employer) and that the foregoing is
a true and correct copy of a resolution (ordinance) duly
adopted by the (governing body) at a meeting duly convened and
held on (date).
SEAL
(Signature of clerk or secretary)
(c) To be eligible for the benefits provided under an early
retirement incentive program adopted under this Section, a
member must:
(1) be a participating employee of this Fund who, on
the effective date of the program, (i) is in active payroll
status as an employee of a participating employer that has
filed the required ordinance or resolution with the Board,
(ii) is on layoff status from such a position with a right
of re-employment or recall to service, (iii) is on a leave
of absence from such a position, or (iv) is on disability
but has not been receiving benefits under Section 7-146 or
7-150 for a period of more than 2 years from the date of
application;

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(2) have never previously received a retirement
annuity under this Article or under the Retirement Systems
Reciprocal Act using service credit established under this
Article;
(3) (blank);
(4) have at least 20 years of creditable service in the
Fund by the date of retirement, without the use of any
creditable service established under this Section;
(5) have attained age 50 by the date of retirement,
without the use of any age enhancement received under this
Section; and
(6) be eligible to receive a retirement annuity under
this Article by the date of retirement, for which purpose
the age enhancement and creditable service established
under this Section may be considered.
(d) The employer shall determine the retirement date for
each employee participating in the early retirement program
adopted under this Section. The retirement date shall be no
earlier than the effective date of the program and no later
than one year after that effective date, except that the
employee may require that the retirement date set by the
employer be no later than the June 30 next occurring after the
effective date of the program and no earlier than the date upon
which the employee qualifies for retirement. The employer shall
give each employee participating in the early retirement
program at least 30 days written notice of the employee's

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designated retirement date, unless the employee waives this
notice requirement.
(e) An eligible person may establish up to 5 years of
creditable service under this Section. In addition, for each
period of creditable service established under this Section, a
person shall have his or her age at retirement deemed enhanced
by an equivalent period.
The creditable service established under this Section may
be used for all purposes under this Article and the Retirement
Systems Reciprocal Act, except for the computation of final
rate of earnings and the determination of earnings, salary, or
compensation under this or any other Article of the Code.
The age enhancement established under this Section may be
used for all purposes under this Article (including calculation
of the reduction imposed under subdivision (a)1b(iv) of Section
7-142), except for purposes of a reversionary annuity under
Section 7-145 and any distributions required because of age.
The age enhancement established under this Section may be used
in calculating a proportionate annuity payable by this Fund
under the Retirement Systems Reciprocal Act, but shall not be
used in determining benefits payable under other Articles of
this Code under the Retirement Systems Reciprocal Act.
(f) For all creditable service established under this
Section, the member must pay to the Fund an employee
contribution consisting of the total employee contribution
rate in effect at the time the member purchases the service for

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the plan in which the member was participating with the
employer at that time multiplied by the member's highest annual
salary rate used in the determination of the final rate of
earnings for retirement annuity purposes for each year of
creditable service granted under this Section. Contributions
for fractions of a year of service shall be prorated. Any
amounts that are disregarded in determining the final rate of
earnings under subdivision (d)(5) of Section 7-116 (the 125%
rule) shall also be disregarded in determining the required
contribution under this subsection (f).
The employee contribution shall be paid to the Fund as
follows: If the member is entitled to a lump sum payment for
accumulated vacation, sick leave, or personal leave upon
withdrawal from service, the employer shall deduct the employee
contribution from that lump sum and pay the deducted amount
directly to the Fund. If there is no such lump sum payment or
the required employee contribution exceeds the net amount of
the lump sum payment, then the remaining amount due, at the
option of the employee, may either be paid to the Fund before
the annuity commences or deducted from the retirement annuity
in 24 equal monthly installments.
(g) An annuitant who has received any age enhancement or
creditable service under this Section and thereafter accepts
employment with or enters into a personal services contract
with an employer under this Article thereby forfeits that age
enhancement and creditable service; except that this

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restriction does not apply to (1) service in an elective
office, so long as the annuitant does not participate in this
Fund with respect to that office, (2) a person appointed as an
officer under subsection (f) of Section 3-109 of this Code, and
(3) a person appointed as an auxiliary police officer pursuant
to Section 3.1-30-5 of the Illinois Municipal Code, (4) a
person who, on or after the effective date of this amendatory
Act of the 100th General Assembly and before July 1, 2020,
participates in the system under Article 16 of this Code as a
substitute teacher, as defined under Section 16-106.3, and (5)
a person who returns to work for a participating employer for
less than 600 hours in any 12-month period on or after the
effective date of this amendatory Act of the 100th General
Assembly and before July 1, 2020. A person forfeiting early
retirement incentives under this subsection (i) must repay to
the Fund that portion of the retirement annuity already
received which is attributable to the early retirement
incentives that are being forfeited, (ii) shall not be eligible
to participate in any future early retirement program adopted
under this Section, and (iii) is entitled to a refund of the
employee contribution paid under subsection (f). The Board
shall deduct the required repayment from the refund and may
impose a reasonable payment schedule for repaying the amount,
if any, by which the required repayment exceeds the refund
amount.
(h) The additional unfunded liability accruing as a result

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of the adoption of a program of early retirement incentives
under this Section by an employer shall be amortized over a
period of 10 years beginning on January 1 of the second
calendar year following the calendar year in which the latest
date for beginning to receive a retirement annuity under the
program (as determined by the employer under subsection (d) of
this Section) occurs; except that the employer may provide for
a shorter amortization period (of no less than 5 years) by
adopting an ordinance or resolution specifying the length of
the amortization period and submitting a certified copy of the
ordinance or resolution to the Fund no later than 6 months
after the effective date of the program. An employer, at its
discretion, may accelerate payments to the Fund.
An employer may provide more than one early retirement
incentive program for its employees under this Section.
However, an employer that has provided an early retirement
incentive program for its employees under this Section may not
provide another early retirement incentive program under this
Section until the liability arising from the earlier program
has been fully paid to the Fund.
(Source: P.A. 99-382, eff. 8-17-15.)".