Bill Text: IL HB3816 | 2009-2010 | 96th General Assembly | Introduced

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Bill Title: Amends the Downstate Police, Chicago Police, Illinois Municipal Retirement Fund, Chicago Municipal, Cook County, Metropolitan Water Reclamation District, and State Universities Articles of the Illinois Pension Code. Allows police officers to establish creditable service for up to 4 years of military service before employment. Requires payment of employee and employer contributions, plus interest. Amends the State Mandates Act to require implementation without reimbursement. Effective immediately.

Spectrum: Partisan Bill (Republican 1-0)

Status: (Introduced - Dead) 2009-03-13 - Rule 19(a) / Re-referred to Rules Committee [HB3816 Detail]

Download: Illinois-2009-HB3816-Introduced.html

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96TH GENERAL ASSEMBLY State of Illinois 2009 and 2010 HB3816 Introduced 2/25/2009, by Rep. Jim Watson SYNOPSIS AS INTRODUCED:
40 ILCS 5/3-110 from Ch. 108 1/2, par. 3-110
40 ILCS 5/5-212 from Ch. 108 1/2, par. 5-212
40 ILCS 5/5-214.3 new
40 ILCS 5/7-139 from Ch. 108 1/2, par. 7-139
40 ILCS 5/8-230.11 new
40 ILCS 5/9-179.1 from Ch. 108 1/2, par. 9-179.1
40 ILCS 5/13-403 from Ch. 108 1/2, par. 13-403
40 ILCS 5/15-113.3 from Ch. 108 1/2, par. 15-113.3
30 ILCS 805/8.33 new
Amends the Downstate Police, Chicago Police, Illinois Municipal Retirement Fund, Chicago Municipal, Cook County, Metropolitan Water Reclamation District, and State Universities Articles of the Illinois Pension Code. Allows police officers to establish creditable service for up to 4 years of military service before employment. Requires payment of employee and employer contributions, plus interest. Amends the State Mandates Act to require implementation without reimbursement. Effective immediately.
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FISCAL NOTE ACT MAY APPLY PENSION IMPACT NOTE ACT MAY APPLY STATE MANDATES ACT MAY REQUIRE REIMBURSEMENT
A BILL FOR
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AN ACT concerning public employee benefits.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 5. The Illinois Pension Code is amended by changing
Sections 3-110, 5-212, 7-139, 9-179.1, 13-403, and 15-113.3 and
by adding Sections 5-214.3 and 8-230.11 as follows:
(40 ILCS 5/3-110) (from Ch. 108 1/2, par. 3-110)
Sec. 3-110. Creditable service.
(a) "Creditable service" is the time served by a police
officer as a member of a regularly constituted police force of
a municipality. In computing creditable service furloughs
without pay exceeding 30 days shall not be counted, but all
leaves of absence for illness or accident, regardless of
length, and all periods of disability retirement for which a
police officer has received no disability pension payments
under this Article shall be counted.
(a-5) Up to 3 years of time during which the police officer
receives a disability pension under Section 3-114.1, 3-114.2,
3-114.3, or 3-114.6 shall be counted as creditable service,
provided that (i) the police officer returns to active service
after the disability for a period at least equal to the period
for which credit is to be established and (ii) the police
officer makes contributions to the fund based on the rates

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specified in Section 3-125.1 and the salary upon which the
disability pension is based. These contributions may be paid at
any time prior to the commencement of a retirement pension. The
police officer may, but need not, elect to have the
contributions deducted from the disability pension or to pay
them in installments on a schedule approved by the board. If
not deducted from the disability pension, the contributions
shall include interest at the rate of 6% per year, compounded
annually, from the date for which service credit is being
established to the date of payment. If contributions are paid
under this subsection (a-5) in excess of those needed to
establish the credit, the excess shall be refunded. This
subsection (a-5) applies to persons receiving a disability
pension under Section 3-114.1, 3-114.2, 3-114.3, or 3-114.6 on
the effective date of this amendatory Act of the 91st General
Assembly, as well as persons who begin to receive such a
disability pension after that date.
(b) Creditable service includes all periods of service in
the military, naval or air forces of the United States entered
upon while an active police officer of a municipality, provided
that upon applying for a permanent pension, and in accordance
with the rules of the board, the police officer pays into the
fund the amount the officer would have contributed if he or she
had been a regular contributor during such period, to the
extent that the municipality which the police officer served
has not made such contributions in the officer's behalf. The

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total amount of such creditable service shall not exceed 5
years, except that any police officer who on July 1, 1973 had
more than 5 years of such creditable service shall receive the
total amount thereof.
(b-5) Creditable service includes all periods of service in
the military, naval, or air forces of the United States entered
upon before beginning service as an active police officer of a
municipality, provided that, in accordance with the rules of
the board, the police officer pays into the fund the amount the
police officer would have contributed if he or she had been a
regular contributor during such period, plus an amount
determined by the Board to be equal to the municipality's
normal cost of the benefit, plus interest calculated from the
date the employee last became a police officer under this
Article. The total amount of such creditable service shall not
exceed 4 years.
(c) Creditable service also includes service rendered by a
police officer while on leave of absence from a police
department to serve as an executive of an organization whose
membership consists of members of a police department, subject
to the following conditions: (i) the police officer is a
participant of a fund established under this Article with at
least 10 years of service as a police officer; (ii) the police
officer received no credit for such service under any other
retirement system, pension fund, or annuity and benefit fund
included in this Code; (iii) pursuant to the rules of the board

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the police officer pays to the fund the amount he or she would
have contributed had the officer been an active member of the
police department; and (iv) the organization pays a
contribution equal to the municipality's normal cost for that
period of service.
(d)(1) Creditable service also includes periods of
service originally established in another police pension
fund under this Article or in the Fund established under
Article 7 of this Code for which (i) the contributions have
been transferred under Section 3-110.7 or Section 7-139.9
and (ii) any additional contribution required under
paragraph (2) of this subsection has been paid in full in
accordance with the requirements of this subsection (d).
(2) If the board of the pension fund to which
creditable service and related contributions are
transferred under Section 3-110.7 or 7-139.9 determines
that the amount transferred is less than the true cost to
the pension fund of allowing that creditable service to be
established, then in order to establish that creditable
service the police officer must pay to the pension fund,
within the payment period specified in paragraph (3) of
this subsection, an additional contribution equal to the
difference, as determined by the board in accordance with
the rules and procedures adopted under paragraph (6) of
this subsection.
(3) Except as provided in paragraph (4), the additional

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contribution must be paid to the board (i) within 5 years
from the date of the transfer of contributions under
Section 3-110.7 or 7-139.9 and (ii) before the police
officer terminates service with the fund. The additional
contribution may be paid in a lump sum or in accordance
with a schedule of installment payments authorized by the
board.
(4) If the police officer dies in service before
payment in full has been made and before the expiration of
the 5-year payment period, the surviving spouse of the
officer may elect to pay the unpaid amount on the officer's
behalf within 6 months after the date of death, in which
case the creditable service shall be granted as though the
deceased police officer had paid the remaining balance on
the day before the date of death.
(5) If the additional contribution is not paid in full
within the required time, the creditable service shall not
be granted and the police officer (or the officer's
surviving spouse or estate) shall be entitled to receive a
refund of (i) any partial payment of the additional
contribution that has been made by the police officer and
(ii) those portions of the amounts transferred under
subdivision (a)(1) of Section 3-110.7 or subdivisions
(a)(1) and (a)(3) of Section 7-139.9 that represent
employee contributions paid by the police officer (but not
the accumulated interest on those contributions) and

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interest paid by the police officer to the prior pension
fund in order to reinstate service terminated by acceptance
of a refund.
At the time of paying a refund under this item (5), the
pension fund shall also repay to the pension fund from
which the contributions were transferred under Section
3-110.7 or 7-139.9 the amount originally transferred under
subdivision (a)(2) of that Section, plus interest at the
rate of 6% per year, compounded annually, from the date of
the original transfer to the date of repayment. Amounts
repaid to the Article 7 fund under this provision shall be
credited to the appropriate municipality.
Transferred credit that is not granted due to failure
to pay the additional contribution within the required time
is lost; it may not be transferred to another pension fund
and may not be reinstated in the pension fund from which it
was transferred.
(6) The Public Employee Pension Fund Division of the
Department of Insurance shall establish by rule the manner
of making the calculation required under paragraph (2) of
this subsection, taking into account the appropriate
actuarial assumptions; the police officer's service, age,
and salary history; the level of funding of the pension
fund to which the credits are being transferred; and any
other factors that the Division determines to be relevant.
The rules may require that all calculations made under

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paragraph (2) be reported to the Division by the board
performing the calculation, together with documentation of
the creditable service to be transferred, the amounts of
contributions and interest to be transferred, the manner in
which the calculation was performed, the numbers relied
upon in making the calculation, the results of the
calculation, and any other information the Division may
deem useful.
(e)(1) Creditable service also includes periods of
service originally established in the Fund established
under Article 7 of this Code for which the contributions
have been transferred under Section 7-139.11.
(2) If the board of the pension fund to which
creditable service and related contributions are
transferred under Section 7-139.11 determines that the
amount transferred is less than the true cost to the
pension fund of allowing that creditable service to be
established, then the amount of creditable service the
police officer may establish under this subsection (e)
shall be reduced by an amount equal to the difference, as
determined by the board in accordance with the rules and
procedures adopted under paragraph (3) of this subsection.
(3) The Public Pension Division of the Department of
Financial and Professional Regulation shall establish by
rule the manner of making the calculation required under
paragraph (2) of this subsection, taking into account the

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appropriate actuarial assumptions; the police officer's
service, age, and salary history; the level of funding of
the pension fund to which the credits are being
transferred; and any other factors that the Division
determines to be relevant. The rules may require that all
calculations made under paragraph (2) be reported to the
Division by the board performing the calculation, together
with documentation of the creditable service to be
transferred, the amounts of contributions and interest to
be transferred, the manner in which the calculation was
performed, the numbers relied upon in making the
calculation, the results of the calculation, and any other
information the Division may deem useful.
(4) Until January 1, 2010, a police officer who
transferred service from the Fund established under
Article 7 of this Code under the provisions of Public Act
94-356 may establish additional credit, but only for the
amount of the service credit reduction in that transfer, as
calculated under paragraph (3) of this subsection (e). This
credit may be established upon payment by the police
officer of an amount to be determined by the board, equal
to (1) the amount that would have been contributed as
employee and employer contributions had all of the service
been as an employee under this Article, plus interest
thereon at the rate of 6% per year, compounded annually
from the date of service to the date of transfer, less (2)

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the total amount transferred from the Article 7 Fund, plus
(3) interest on the difference at the rate of 6% per year,
compounded annually, from the date of the transfer to the
date of payment. The additional service credit is allowed
under this amendatory Act of the 95th General Assembly
notwithstanding the provisions of Article 7 terminating
all transferred credits on the date of transfer.
(Source: P.A. 94-356, eff. 7-29-05; 95-812, eff. 8-13-08.)
(40 ILCS 5/5-212) (from Ch. 108 1/2, par. 5-212)
Sec. 5-212. Computation of service. In computing the
service rendered by a policeman prior to the effective date,
the following periods shall be counted, in addition to all
periods during where he performed the duties of his position,
as periods of service for annuity purposes only: all periods of
(a) vacation; (b) leave of absence with whole or part pay; (c)
leave of absence without pay on account of disability; and (d)
leave of absence during which the policeman was engaged in the
military or naval service of the United States of America.
Service credit shall not be allowed for a policeman in receipt
of a pension on account of disability from any pension fund
superseded by this fund.
In computing the service rendered by a policeman on or
after the effective date, the following periods shall be
counted, in addition to all periods during which he performed
the duties of his position, as periods of service for annuity

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purposes only: all periods of (a) vacation; (b) leave of
absence with whole or part pay; (c) leave of absence during
which the policeman was engaged in the military or naval
service of the United States of America; (d) time that the
policeman was engaged in the military or naval service of the
United States of America, during which he was passed over on
any eligible list posted from an entrance examination, due to
the fact that he was in such military or naval service at the
time he was called for appointment to the Police Department, to
be computed from the date he was passed over on any eligible
list and would have been first sworn in as a policeman had he
not been engaged in the military or naval service of the United
States of America, until the date of his discharge from such
military or naval service; provided that such policeman shall
pay into this Fund the same amount that would have been
deducted from his salary had he been a policeman during the
aforementioned portion of such military or naval service; (e)
disability for which the policeman receives any disability
benefit; (f) disability for which the policeman receives whole
or part pay; and (g) service for which credits and creditable
service have been transferred to this Fund under Section
9-121.1, 14-105.1 or 15-134.3 of this Code; and (h) periods of
service in the military, naval, or air forces of the United
States entered upon before beginning service as an active
policeman of a municipality as provided in Section 5-214.2.
In computing service on or after the effective date for

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ordinary disability benefit, all periods described in the
preceding paragraph, except any such period for which a
policeman receives ordinary disability benefit, shall be
counted as periods of service.
In computing service for any of the purposes of this
Article, no credit shall be given for any period during which a
policeman was not rendering active service because of his
discharge from the service, unless proceedings to test the
legality of the discharge are filed in a court of competent
jurisdiction within one year from the date of discharge and a
final judgment is entered therein declaring the discharge
illegal.
No overtime or extra service shall be included in computing
service of a policeman and not more than one year or a
fractional part thereof of service shall be allowed for service
rendered during any calendar year.
In computing service for any of the purposes of this
Article, credit shall be given for any periods during which a
policeman who is a member of the General Assembly is on leave
of absence or is otherwise authorized to be absent from duty to
enable him or her to perform legislative duties,
notwithstanding any reduction in salary for such periods and
notwithstanding that the contributions paid by the policeman
were based on a reduced salary rather than the full amount of
salary attached to his or her career service rank.
(Source: P.A. 92-52, eff. 7-12-01.)

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(40 ILCS 5/5-214.3 new)
Sec. 5-214.3. Credit for military service. A policeman may
establish creditable service under this Article for all periods
of service in the military, naval, or air forces of the United
States entered upon before beginning service as an active
policeman of a municipality, provided that the policeman pays
into the fund the amount the policeman would have contributed
if he or she had been a regular contributor during such period,
plus an amount determined by the Board to be equal to the
municipality's normal cost of the benefit, plus interest
calculated from the date the employee last became a policeman
under this Article. The total amount of such creditable service
shall not exceed 4 years.
(40 ILCS 5/7-139) (from Ch. 108 1/2, par. 7-139)
Sec. 7-139. Credits and creditable service to employees.
(a) Each participating employee shall be granted credits
and creditable service, for purposes of determining the amount
of any annuity or benefit to which he or a beneficiary is
entitled, as follows:
1. For prior service: Each participating employee who
is an employee of a participating municipality or
participating instrumentality on the effective date shall
be granted creditable service, but no credits under
paragraph 2 of this subsection (a), for periods of prior

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service for which credit has not been received under any
other pension fund or retirement system established under
this Code, as follows:
If the effective date of participation for the
participating municipality or participating
instrumentality is on or before January 1, 1998, creditable
service shall be granted for the entire period of prior
service with that employer without any employee
contribution.
If the effective date of participation for the
participating municipality or participating
instrumentality is after January 1, 1998, creditable
service shall be granted for the last 20% of the period of
prior service with that employer, but no more than 5 years,
without any employee contribution. A participating
employee may establish creditable service for the
remainder of the period of prior service with that employer
by making an application in writing, accompanied by payment
of an employee contribution in an amount determined by the
Fund, based on the employee contribution rates in effect at
the time of application for the creditable service and the
employee's salary rate on the effective date of
participation for that employer, plus interest at the
effective rate from the date of the prior service to the
date of payment. Application for this creditable service
may be made at any time while the employee is still in

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service.
A municipality that (i) has at least 35 employees; (ii)
is located in a county with at least 2,000,000 inhabitants;
and (iii) maintains an independent defined benefit pension
plan for the benefit of its eligible employees may restrict
creditable service in whole or in part for periods of prior
service with the employer if the governing body of the
municipality adopts an irrevocable resolution to restrict
that creditable service and files the resolution with the
board before the municipality's effective date of
participation.
Any person who has withdrawn from the service of a
participating municipality or participating
instrumentality prior to the effective date, who reenters
the service of the same municipality or participating
instrumentality after the effective date and becomes a
participating employee is entitled to creditable service
for prior service as otherwise provided in this subdivision
(a)(1) only if he or she renders 2 years of service as a
participating employee after the effective date.
Application for such service must be made while in a
participating status. The salary rate to be used in the
calculation of the required employee contribution, if any,
shall be the employee's salary rate at the time of first
reentering service with the employer after the employer's
effective date of participation.

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2. For current service, each participating employee
shall be credited with:
a. Additional credits of amounts equal to each
payment of additional contributions received from him
under Section 7-173, as of the date the corresponding
payment of earnings is payable to him.
b. Normal credits of amounts equal to each payment
of normal contributions received from him, as of the
date the corresponding payment of earnings is payable
to him, and normal contributions made for the purpose
of establishing out-of-state service credits as
permitted under the conditions set forth in paragraph 6
of this subsection (a).
c. Municipality credits in an amount equal to 1.4
times the normal credits, except those established by
out-of-state service credits, as of the date of
computation of any benefit if these credits would
increase the benefit.
d. Survivor credits equal to each payment of
survivor contributions received from the participating
employee as of the date the corresponding payment of
earnings is payable, and survivor contributions made
for the purpose of establishing out-of-state service
credits.
3. For periods of temporary and total and permanent
disability benefits, each employee receiving disability

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benefits shall be granted creditable service for the period
during which disability benefits are payable. Normal and
survivor credits, based upon the rate of earnings applied
for disability benefits, shall also be granted if such
credits would result in a higher benefit to any such
employee or his beneficiary.
4. For authorized leave of absence without pay: A
participating employee shall be granted credits and
creditable service for periods of authorized leave of
absence without pay under the following conditions:
a. An application for credits and creditable
service is submitted to the board while the employee is
in a status of active employment, and within 2 years
after termination of the leave of absence period for
which credits and creditable service are sought.
b. Not more than 12 complete months of creditable
service for authorized leave of absence without pay
shall be counted for purposes of determining any
benefits payable under this Article.
c. Credits and creditable service shall be granted
for leave of absence only if such leave is approved by
the governing body of the municipality, including
approval of the estimated cost thereof to the
municipality as determined by the fund, and employee
contributions, plus interest at the effective rate
applicable for each year from the end of the period of

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leave to date of payment, have been paid to the fund in
accordance with Section 7-173. The contributions shall
be computed upon the assumption earnings continued
during the period of leave at the rate in effect when
the leave began.
d. Benefits under the provisions of Sections
7-141, 7-146, 7-150 and 7-163 shall become payable to
employees on authorized leave of absence, or their
designated beneficiary, only if such leave of absence
is creditable hereunder, and if the employee has at
least one year of creditable service other than the
service granted for leave of absence. Any employee
contributions due may be deducted from any benefits
payable.
e. No credits or creditable service shall be
allowed for leave of absence without pay during any
period of prior service.
5. For military service: Except as provided in
paragraph 5.2, the The governing body of a municipality or
participating instrumentality may elect to allow
creditable service to participating employees who leave
their employment to serve in the armed forces of the United
States for all periods of such service, provided that the
person returns to active employment within 90 days after
completion of full time active duty, but no creditable
service shall be allowed such person for any period that

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can be used in the computation of a pension or any other
pay or benefit, other than pay for active duty, for service
in any branch of the armed forces of the United States. If
necessary to the computation of any benefit, the board
shall establish municipality credits for participating
employees under this paragraph on the assumption that the
employee received earnings at the rate received at the time
he left the employment to enter the armed forces. A
participating employee in the armed forces shall not be
considered an employee during such period of service and no
additional death and no disability benefits are payable for
death or disability during such period.
Any participating employee who left his employment
with a municipality or participating instrumentality to
serve in the armed forces of the United States and who
again became a participating employee within 90 days after
completion of full time active duty by entering the service
of a different municipality or participating
instrumentality, which has elected to allow creditable
service for periods of military service under the preceding
paragraph, shall also be allowed creditable service for his
period of military service on the same terms that would
apply if he had been employed, before entering military
service, by the municipality or instrumentality which
employed him after he left the military service and the
employer costs arising in relation to such grant of

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creditable service shall be charged to and paid by that
municipality or instrumentality.
Notwithstanding the foregoing, any participating
employee shall be entitled to creditable service as
required by any federal law relating to re-employment
rights of persons who served in the United States Armed
Services. Such creditable service shall be granted upon
payment by the member of an amount equal to the employee
contributions which would have been required had the
employee continued in service at the same rate of earnings
during the military leave period, plus interest at the
effective rate.
5.1. In addition to any creditable service established
under paragraph 5 of this subsection (a) and except as
provided in paragraph 5.2, creditable service may be
granted for up to 48 months of service in the armed forces
of the United States.
In order to receive creditable service for military
service under this paragraph 5.1, a participating employee
must (1) apply to the Fund in writing and provide evidence
of the military service that is satisfactory to the Board;
(2) obtain the written approval of the current employer;
and (3) make contributions to the Fund equal to (i) the
employee contributions that would have been required had
the service been rendered as a member, plus (ii) an amount
determined by the board to be equal to the employer's

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normal cost of the benefits accrued for that military
service, plus (iii) interest on items (i) and (ii) from the
date of first membership in the Fund to the date of
payment. The required interest shall be calculated at the
regular interest rate.
The changes made to this paragraph 5.1 by Public Acts
95-483 and 95-486 apply only to participating employees in
service on or after August 28, 2007 (the effective date of
those Public Acts).
5.2. Beginning on the effective date of this amendatory
Act of the 96th General Assembly, a person employed on or
after the effective date of this amendatory Act by a
municipality or participating instrumentality to perform
police duties shall be granted creditable service for
military service described under paragraphs 5 and 5.1 upon
satisfaction of any requirements contained in those
paragraphs.
6. For out-of-state service: Creditable service shall
be granted for service rendered to an out-of-state local
governmental body under the following conditions: The
employee had participated and has irrevocably forfeited
all rights to benefits in the out-of-state public employees
pension system; the governing body of his participating
municipality or instrumentality authorizes the employee to
establish such service; the employee has 2 years current
service with this municipality or participating

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instrumentality; the employee makes a payment of
contributions, which shall be computed at 8% (normal) plus
2% (survivor) times length of service purchased times the
average rate of earnings for the first 2 years of service
with the municipality or participating instrumentality
whose governing body authorizes the service established
plus interest at the effective rate on the date such
credits are established, payable from the date the employee
completes the required 2 years of current service to date
of payment. In no case shall more than 120 months of
creditable service be granted under this provision.
7. For retroactive service: Any employee who could have
but did not elect to become a participating employee, or
who should have been a participant in the Municipal Public
Utilities Annuity and Benefit Fund before that fund was
superseded, may receive creditable service for the period
of service not to exceed 50 months; however, a current or
former elected or appointed official of a participating
municipality may establish credit under this paragraph 7
for more than 50 months of service as an official of that
municipality, if the excess over 50 months is approved by
resolution of the governing body of the affected
municipality filed with the Fund before January 1, 2002.
Any employee who is a participating employee on or
after September 24, 1981 and who was excluded from
participation by the age restrictions removed by Public Act

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82-596 may receive creditable service for the period, on or
after January 1, 1979, excluded by the age restriction and,
in addition, if the governing body of the participating
municipality or participating instrumentality elects to
allow creditable service for all employees excluded by the
age restriction prior to January 1, 1979, for service
during the period prior to that date excluded by the age
restriction. Any employee who was excluded from
participation by the age restriction removed by Public Act
82-596 and who is not a participating employee on or after
September 24, 1981 may receive creditable service for
service after January 1, 1979. Creditable service under
this paragraph shall be granted upon payment of the
employee contributions which would have been required had
he participated, with interest at the effective rate for
each year from the end of the period of service established
to date of payment.
8. For accumulated unused sick leave: A participating
employee who is applying for a retirement annuity shall be
entitled to creditable service for that portion of the
employee's accumulated unused sick leave for which payment
is not received, as follows:
a. Sick leave days shall be limited to those
accumulated under a sick leave plan established by a
participating municipality or participating
instrumentality which is available to all employees or

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a class of employees.
b. Only sick leave days accumulated with a
participating municipality or participating
instrumentality with which the employee was in service
within 60 days of the effective date of his retirement
annuity shall be credited; If the employee was in
service with more than one employer during this period
only the sick leave days with the employer with which
the employee has the greatest number of unpaid sick
leave days shall be considered.
c. The creditable service granted shall be
considered solely for the purpose of computing the
amount of the retirement annuity and shall not be used
to establish any minimum service period required by any
provision of the Illinois Pension Code, the effective
date of the retirement annuity, or the final rate of
earnings.
d. The creditable service shall be at the rate of
1/20 of a month for each full sick day, provided that
no more than 12 months may be credited under this
subdivision 8.
e. Employee contributions shall not be required
for creditable service under this subdivision 8.
f. Each participating municipality and
participating instrumentality with which an employee
has service within 60 days of the effective date of his

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retirement annuity shall certify to the board the
number of accumulated unpaid sick leave days credited
to the employee at the time of termination of service.
9. For service transferred from another system:
Credits and creditable service shall be granted for service
under Article 3, 4, 5, 8, 14, or 16 of this Act, to any
active member of this Fund, and to any inactive member who
has been a county sheriff, upon transfer of such credits
pursuant to Section 3-110.3, 4-108.3, 5-235, 8-226.7,
14-105.6, or 16-131.4, and payment by the member of the
amount by which (1) the employer and employee contributions
that would have been required if he had participated in
this Fund as a sheriff's law enforcement employee during
the period for which credit is being transferred, plus
interest thereon at the effective rate for each year,
compounded annually, from the date of termination of the
service for which credit is being transferred to the date
of payment, exceeds (2) the amount actually transferred to
the Fund. Such transferred service shall be deemed to be
service as a sheriff's law enforcement employee for the
purposes of Section 7-142.1.
10. For service transferred from an Article 3 system
under Section 3-110.8: Credits and creditable service
shall be granted for service under Article 3 of this Act as
provided in Section 3-110.8, to any active member of this
Fund upon transfer of such credits pursuant to Section

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3-110.8. If the amount by which (1) the employer and
employee contributions that would have been required if he
had participated in this Fund during the period for which
credit is being transferred, plus interest thereon at the
effective rate for each year, compounded annually, from the
date of termination of the service for which credit is
being transferred to the date of payment, exceeds (2) the
amount actually transferred to the Fund, then the amount of
creditable service established under this paragraph 10
shall be reduced by a corresponding amount in accordance
with the rules and procedures established under this
paragraph 10.
The board shall establish by rule the manner of making
the calculation required under this paragraph 10, taking
into account the appropriate actuarial assumptions; the
member's service, age, and salary history; the level of
funding of the employer; and any other factors that the
board determines to be relevant.
Until January 1, 2010, members who transferred service
from an Article 3 system under the provisions of Public Act
94-356 may establish additional credit in this Fund, but
only up to the amount of the service credit reduction in
that transfer, as calculated under the actuarial
assumptions. This credit may be established upon payment by
the member of an amount to be determined by the board,
equal to (1) the amount that would have been contributed as

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employee and employer contributions had all the service
been as an employee under this Article, plus interest
thereon compounded annually from the date of service to the
date of transfer, less (2) the total amount transferred
from the Article 3 system, plus (3) interest on the
difference at the effective rate for each year, compounded
annually, from the date of the transfer to the date of
payment. The additional service credit is allowed under
this amendatory Act of the 95th General Assembly
notwithstanding the provisions of Article 3 terminating
all transferred credits on the date of transfer.
(b) Creditable service - amount:
1. One month of creditable service shall be allowed for
each month for which a participating employee made
contributions as required under Section 7-173, or for which
creditable service is otherwise granted hereunder. Not
more than 1 month of service shall be credited and counted
for 1 calendar month, and not more than 1 year of service
shall be credited and counted for any calendar year. A
calendar month means a nominal month beginning on the first
day thereof, and a calendar year means a year beginning
January 1 and ending December 31.
2. A seasonal employee shall be given 12 months of
creditable service if he renders the number of months of
service normally required by the position in a 12-month
period and he remains in service for the entire 12-month

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period. Otherwise a fractional year of service in the
number of months of service rendered shall be credited.
3. An intermittent employee shall be given creditable
service for only those months in which a contribution is
made under Section 7-173.
(c) No application for correction of credits or creditable
service shall be considered unless the board receives an
application for correction while (1) the applicant is a
participating employee and in active employment with a
participating municipality or instrumentality, or (2) while
the applicant is actively participating in a pension fund or
retirement system which is a participating system under the
Retirement Systems Reciprocal Act. A participating employee or
other applicant shall not be entitled to credits or creditable
service unless the required employee contributions are made in
a lump sum or in installments made in accordance with board
rule.
(d) Upon the granting of a retirement, surviving spouse or
child annuity, a death benefit or a separation benefit, on
account of any employee, all individual accumulated credits
shall thereupon terminate. Upon the withdrawal of additional
contributions, the credits applicable thereto shall thereupon
terminate. Terminated credits shall not be applied to increase
the benefits any remaining employee would otherwise receive
under this Article.
(Source: P.A. 95-483, eff. 8-28-07; 95-486, eff. 8-28-07;

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95-504, eff. 8-28-07; 95-812, eff. 8-13-08; 95-876, eff.
8-21-08.)
(40 ILCS 5/8-230.11 new)
Sec. 8-230.11. Service credit for military service. An
employee of the municipality serving as a police officer may
establish service credit under this Article for all periods of
service in the military, naval, or air forces of the United
States entered upon before beginning service as an active
police officer of a municipality, provided that the policeman
pays into the fund the amount the police officer would have
contributed if he or she had been a regular contributor during
such period, plus an amount determined by the Board to be equal
to the municipality's normal cost of the benefit, plus interest
calculated from the date the employee last became a police
officer under this Article. The total amount of such service
credit shall not exceed 4 years.
(40 ILCS 5/9-179.1) (from Ch. 108 1/2, par. 9-179.1)
Sec. 9-179.1. Military service.
(a) A contributing employee as of January 1, 1993 with at
least 25 years of service credit may apply for creditable
service for up to 2 years of military service whether or not
the military service followed service as a county employee. The
military service need not have been served in wartime, but the
employee must not have been dishonorably discharged. To

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establish this creditable service the applicant must pay to the
Fund, while in the service of the county, an amount determined
by the Fund to represent the employee contributions for the
creditable service established, based on the employee's rate of
compensation on his or her last day as a contributor before the
military service, or on his or her first day as a contributor
after the military service, whichever is greater, plus interest
at the effective rate from the date of discharge to the date of
payment. If a person who has established any credit under this
Section applies for or receives any early retirement incentive
under Section 9-134.2, the credit under this Section shall be
forfeited and the amount paid to the Fund under this Section
shall be refunded.
(b) A contributing employee employed by the county as a
police officer on or after the effective date of this
amendatory Act of the 96th General Assembly may establish
creditable service for up to 4 years of military service
whether or not the military service followed service as a
county employee. The military service need not have been served
in wartime, but the employee must not have been dishonorably
discharged. To establish this creditable service the applicant
must pay to the Fund, while in the service of the county, an
amount determined by the Fund to represent the employee
contributions for the creditable service established, based on
the employee's rate of compensation on his or her last day as a
contributor before the military service, or on his or her first

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day as a contributor after the military service, whichever is
greater, plus an amount determined by the Fund to be equal to
the county's normal cost of the benefit, plus interest at the
effective rate from the date of discharge to the date of
payment.
(Source: P.A. 87-1265.)
(40 ILCS 5/13-403) (from Ch. 108 1/2, par. 13-403)
Sec. 13-403. Military service.
(a) Any employee who, after commencement of service with
the Employer, enlisted, was inducted or was otherwise ordered
to serve in the military forces of the United States pursuant
to any law, shall receive full service credit for the various
purposes of this Article as though the employee were in the
active service of the Employer during the period of military
service provided that:
(1) such service credit shall be granted for military
service for which the employee volunteers or is inducted or
called into military service pursuant to a call of a duly
constituted authority or a law of the United States
declaring a national emergency;
(2) the employee returns to the employ of the Employer
within 90 days after the termination of the national
emergency; and
(3) the total service credit for such military service
shall not exceed 5 years except that any employee who on

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July 1, 1963 had accrued more than 5 years of such credit
shall be entitled to the total amount thereof.
(b) For a ten-year period following July 24, 2003, a
contributing employee or commissioner who is not a police
officer meeting the minimum service requirements provided
under this subsection may establish additional service credit
for a period of up to 2 years of active military service in the
United States Armed Forces for which he or she does not qualify
for credit under subsection (a), provided that (1) the person
was not dishonorably discharged from the military service, and
(2) the amount of service credit established by the person
under this subsection (b), when added to the amount of any
military service credit granted to the person under subsection
(a), shall not exceed 5 years.
A contributing employee who is a police officer and who
meets the minimum service requirements provided under this
subsection (b) may establish additional service credit for a
period of up to 4 years of active military service in the
United States Armed Forces for which he or she does not qualify
for credit under subsection (a), provided that (1) the person
was not dishonorably discharged from the military service, and
(2) the amount of service credit established by the person
under this subsection (b), when added to the amount of any
military service credit granted to the person under subsection
(a), shall not exceed 5 years.
The minimum service requirement for a contributing

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employee is 10 years of service credit as provided in Sections
13-401 and 13-402 of this Article and exclusive of Article 20.
The minimum service requirement for a contributing
commissioner is 5 years of service credit as provided in
Sections 13-401 and 13-402 of this Article and exclusive of
Article 20.
In order to establish military service credit under this
subsection (b), the applicant must submit a written application
to the Fund, including the applicant's discharge papers from
military service, and pay to the Fund (i) employee
contributions at the rates provided in this Article, based upon
the person's salary on the last date as a participating
employee prior to the military service or on the first date as
a participating employee after the military service, whichever
is greater, plus (ii) the current amount determined by the
board to be equal to the employer's normal cost of the benefits
accrued for such military service, plus (iii) regular interest
of 3% compounded annually on items (i) and (ii) from the date
of entry or re-entry as a participating employee following the
military service to the date of payment. Contributions must be
paid in full before the credit is granted. Credit established
under this subsection may be used for pension purposes only.
Notwithstanding any other provision of this Section, a
person may not establish creditable service under this Section
for any period for which the person receives credit under any
other public employee retirement system, unless the credit

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under that other retirement system has been irrevocably
relinquished.
(Source: P.A. 93-334, eff. 7-24-03; 94-621, eff. 8-18-05.)
(40 ILCS 5/15-113.3) (from Ch. 108 1/2, par. 15-113.3)
Sec. 15-113.3. Service for periods of military service.
"Service for periods of military service": For a person who is
not a police officer, those Those periods, not exceeding 5
years, during which a person served in the armed forces of the
United States, of which all but 2 years must have immediately
followed a period of employment with an employer under this
System or the State Employees' Retirement System of Illinois;
provided that the person received a discharge other than
dishonorable and again became an employee under this System
within one year after discharge. However, for the up to 2 years
of military service not immediately following employment, the
applicant must make contributions to the System equal to (1) 8%
of the employee's basic compensation on the last date as a
participating employee prior to such military service, or on
the first date as a participating employee after such military
service, whichever is greater, plus (2) an amount determined by
the board to be equal to the employer's normal cost of the
benefits accrued for such military service, plus (3) interest
on items (1) and (2) at the effective rate from the later of
the date of first membership in the System or the date of
conclusion of military service to the date of payment. The

HB3816 - 34 - LRB096 08577 AMC 18700 b
change in the required contribution for purchased military
credit made by this amendatory Act of 1993 does not entitle any
person to a refund of contributions already paid. The
contributions paid under this Section are not normal
contributions as defined in Section 15-114 or additional
contributions as defined in Section 15-115.
For a police officer, those periods, not exceeding 5 years,
during which a person served in the armed forces of the United
States, of which all but 4 years must have immediately followed
a period of employment with an employer under this System or
the State Employees' Retirement System of Illinois; provided
that the person received a discharge other than dishonorable
and again became an employee under this System within one year
after discharge. However, for the up to 4 years of military
service not immediately following employment, the applicant
must make contributions to the System equal to (1) 8% of the
employee's basic compensation on the last date as a
participating employee prior to such military service, or on
the first date as a participating employee after such military
service, whichever is greater, plus (2) an amount determined by
the board to be equal to the employer's normal cost of the
benefits accrued for such military service, plus (3) interest
on items (1) and (2) at the effective rate from the later of
the date of first membership in the System or the date of
conclusion of military service to the date of payment. The
contributions paid under this Section are not normal

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contributions as defined in Section 15-114 or additional
contributions as defined in Section 15-115.
The changes to this Section made by this amendatory Act of
1991 shall apply not only to persons who on or after its
effective date are in service under the System, but also to
persons whose employment terminated prior to that date, whether
or not the person is an annuitant on that date. In the case of
an annuitant who applies for credit allowable under this
Section for a period of military service that did not
immediately follow employment, and who has made the required
contributions for such credit, the annuity shall be
recalculated to include the additional service credit, with the
increase taking effect on the date the System received written
notification of the annuitant's intent to purchase the credit,
if payment of all the required contributions is made within 60
days of such notice, or else on the first annuity payment date
following the date of payment of the required contributions. In
calculating the automatic annual increase for an annuity that
has been recalculated under this Section, the increase
attributable to the additional service allowable under this
amendatory Act of 1991 shall be included in the calculation of
automatic annual increases accruing after the effective date of
the recalculation.
(Source: P.A. 93-347, eff. 7-24-03.)
Section 90. The State Mandates Act is amended by adding

HB3816 - 36 - LRB096 08577 AMC 18700 b
Section 8.33 as follows:
(30 ILCS 805/8.33 new)
Sec. 8.33. Exempt mandate. Notwithstanding Sections 6 and 8
of this Act, no reimbursement by the State is required for the
implementation of any mandate created by this amendatory Act of
the 96th General Assembly.
Section 99. Effective date. This Act takes effect upon
becoming law.