Bill Text: IL SB3073 | 2023-2024 | 103rd General Assembly | Introduced

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Bill Title: Amends the Illinois Pension Code. Requires the State Employees' Retirement System of Illinois to prepare and implement a defined contribution plan by July 1, 2026 that aggregates State and employee contributions in individual participant accounts that are used for payouts after retirement. Provides that a Tier 1 or Tier 2 participant may irrevocably elect to participate in the defined contribution plan instead of the defined benefit plan and may also elect to terminate all participation in the defined benefit plan and to have a specified amount credited to his or her account under the defined contribution plan. Provides that a person who first becomes an employee after the effective date of the amendatory Act is not required to participate in the System as a condition of employment. Provides that an employee may elect not to participate in the System by notifying the System in writing in a manner specified by the System. Provides that any benefit increase that results from the amendatory Act is excluded from the definition of "new benefit increase". Makes conforming and other changes. Makes related changes in the State Employees Group Insurance Act of 1971. Effective immediately.

Spectrum: Partisan Bill (Republican 1-0)

Status: (Introduced) 2024-02-02 - Referred to Assignments [SB3073 Detail]

Download: Illinois-2023-SB3073-Introduced.html

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103RD GENERAL ASSEMBLY State of Illinois 2023 and 2024 SB3073 Introduced 2/2/2024, by Sen. Dan McConchie SYNOPSIS AS INTRODUCED:
5 ILCS 375/3 from Ch. 127, par. 523
5 ILCS 375/10 from Ch. 127, par. 530
40 ILCS 5/1-160
40 ILCS 5/1-161
40 ILCS 5/14-103.05 from Ch. 108 1/2, par. 14-103.05
40 ILCS 5/14-103.41
40 ILCS 5/14-152.1
40 ILCS 5/14-155.5 new
40 ILCS 5/20-121 from Ch. 108 1/2, par. 20-121
40 ILCS 5/20-123 from Ch. 108 1/2, par. 20-123
40 ILCS 5/20-124 from Ch. 108 1/2, par. 20-124
40 ILCS 5/20-125 from Ch. 108 1/2, par. 20-125
Amends the Illinois Pension Code. Requires the State Employees' Retirement System of Illinois to prepare and implement a defined contribution plan by July 1, 2026 that aggregates State and employee contributions in individual participant accounts that are used for payouts after retirement. Provides that a Tier 1 or Tier 2 participant may irrevocably elect to participate in the defined contribution plan instead of the defined benefit plan and may also elect to terminate all participation in the defined benefit plan and to have a specified amount credited to his or her account under the defined contribution plan. Provides that a person who first becomes an employee after the effective date of the amendatory Act is not required to participate in the System as a condition of employment. Provides that an employee may elect not to participate in the System by notifying the System in writing in a manner specified by the System. Provides that any benefit increase that results from the amendatory Act is excluded from the definition of "new benefit increase". Makes conforming and other changes. Makes related changes in the State Employees Group Insurance Act of 1971. Effective immediately.
LRB103 37686 RPS 67813 b
A BILL FOR
SB3073 LRB103 37686 RPS 67813 b
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 State Employees Group Insurance Act of 1971
is amended by changing Sections 3 and 10 as follows:
(5 ILCS 375/3) (from Ch. 127, par. 523)
Sec. 3. Definitions. Unless the context otherwise
requires, the following words and phrases as used in this Act
shall have the following meanings. The Department may define
these and other words and phrases separately for the purpose
of implementing specific programs providing benefits under
this Act.
(a) "Administrative service organization" means any
person, firm or corporation experienced in the handling of
claims which is fully qualified, financially sound and capable
of meeting the service requirements of a contract of
administration executed with the Department.
(b) "Annuitant" means (1) an employee who retires, or has
retired, on or after January 1, 1966 on an immediate annuity
under the provisions of Article Articles 2, 14 (including an
employee who has elected to receive an alternative retirement
cancellation payment under Section 14-108.5 of the Illinois
Pension Code in lieu of an annuity; an employee who, in lieu of

SB3073 - 2 - LRB103 37686 RPS 67813 b
receiving an annuity under that Article, has retired under the
defined contribution plan established under Section 14-155.5
of that Article; or an employee who meets the criteria for
retirement, but in lieu of receiving an annuity under that
Article has elected to receive an accelerated pension benefit
payment under Section 14-147.5 of that Article), or 15
(including an employee who has retired under the optional
retirement program established under Section 15-158.2 or who
meets the criteria for retirement but in lieu of receiving an
annuity under that Article has elected to receive an
accelerated pension benefit payment under Section 15-185.5 of
the Article), paragraph (2), (3), or (5) of Section 16-106
(including an employee who meets the criteria for retirement,
but in lieu of receiving an annuity under that Article has
elected to receive an accelerated pension benefit payment
under Section 16-190.5 of the Illinois Pension Code), or
Article 18 of the Illinois Pension Code; (2) any person who was
receiving group insurance coverage under this Act as of March
31, 1978 by reason of his status as an annuitant, even though
the annuity in relation to which such coverage was provided is
a proportional annuity based on less than the minimum period
of service required for a retirement annuity in the system
involved; (3) any person not otherwise covered by this Act who
has retired as a participating member under Article 2 of the
Illinois Pension Code but is ineligible for the retirement
annuity under Section 2-119 of the Illinois Pension Code; (4)

SB3073 - 3 - LRB103 37686 RPS 67813 b
the spouse of any person who is receiving a retirement annuity
under Article 18 of the Illinois Pension Code and who is
covered under a group health insurance program sponsored by a
governmental employer other than the State of Illinois and who
has irrevocably elected to waive his or her coverage under
this Act and to have his or her spouse considered as the
"annuitant" under this Act and not as a "dependent"; or (5) an
employee who retires, or has retired, from a qualified
position, as determined according to rules promulgated by the
Director, under a qualified local government, a qualified
rehabilitation facility, a qualified domestic violence shelter
or service, or a qualified child advocacy center. (For
definition of "retired employee", see (p) post).
(b-5) (Blank).
(b-6) (Blank).
(b-7) (Blank).
(c) "Carrier" means (1) an insurance company, a
corporation organized under the Limited Health Service
Organization Act or the Voluntary Health Services Plans Act, a
partnership, or other nongovernmental organization, which is
authorized to do group life or group health insurance business
in Illinois, or (2) the State of Illinois as a self-insurer.
(d) "Compensation" means salary or wages payable on a
regular payroll by the State Treasurer on a warrant of the
State Comptroller out of any State, trust or federal fund, or
by the Governor of the State through a disbursing officer of

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the State out of a trust or out of federal funds, or by any
Department out of State, trust, federal or other funds held by
the State Treasurer or the Department, to any person for
personal services currently performed, and ordinary or
accidental disability benefits under Articles 2, 14, or 15
(including ordinary or accidental disability benefits under
the optional retirement program established under Section
15-158.2), paragraph (2), (3), or (5) of Section 16-106, or
Article 18 of the Illinois Pension Code, for disability
incurred after January 1, 1966, or benefits payable under the
Workers' Compensation or Occupational Diseases Act or benefits
payable under a sick pay plan established in accordance with
Section 36 of the State Finance Act. "Compensation" also means
salary or wages paid to an employee of any qualified local
government, qualified rehabilitation facility, qualified
domestic violence shelter or service, or qualified child
advocacy center.
(e) "Commission" means the State Employees Group Insurance
Advisory Commission authorized by this Act. Commencing July 1,
1984, "Commission" as used in this Act means the Commission on
Government Forecasting and Accountability as established by
the Legislative Commission Reorganization Act of 1984.
(f) "Contributory", when referred to as contributory
coverage, shall mean optional coverages or benefits elected by
the member toward the cost of which such member makes
contribution, or which are funded in whole or in part through

SB3073 - 5 - LRB103 37686 RPS 67813 b
the acceptance of a reduction in earnings or the foregoing of
an increase in earnings by an employee, as distinguished from
noncontributory coverage or benefits which are paid entirely
by the State of Illinois without reduction of the member's
salary.
(g) "Department" means any department, institution, board,
commission, officer, court or any agency of the State
government receiving appropriations and having power to
certify payrolls to the Comptroller authorizing payments of
salary and wages against such appropriations as are made by
the General Assembly from any State fund, or against trust
funds held by the State Treasurer and includes boards of
trustees of the retirement systems created by Articles 2, 14,
15, 16, and 18 of the Illinois Pension Code. "Department" also
includes the Illinois Comprehensive Health Insurance Board,
the Board of Examiners established under the Illinois Public
Accounting Act, and the Illinois Finance Authority.
(h) "Dependent", when the term is used in the context of
the health and life plan, means a member's spouse and any child
(1) from birth to age 26 including an adopted child, a child
who lives with the member from the time of the placement for
adoption until entry of an order of adoption, a stepchild or
adjudicated child, or a child who lives with the member if such
member is a court appointed guardian of the child or (2) age 19
or over who has a mental or physical disability from a cause
originating prior to the age of 19 (age 26 if enrolled as an

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adult child dependent). For the health plan only, the term
"dependent" also includes (1) any person enrolled prior to the
effective date of this Section who is dependent upon the
member to the extent that the member may claim such person as a
dependent for income tax deduction purposes and (2) any person
who has received after June 30, 2000 an organ transplant and
who is financially dependent upon the member and eligible to
be claimed as a dependent for income tax purposes. A member
requesting to cover any dependent must provide documentation
as requested by the Department of Central Management Services
and file with the Department any and all forms required by the
Department.
(i) "Director" means the Director of the Illinois
Department of Central Management Services.
(j) "Eligibility period" means the period of time a member
has to elect enrollment in programs or to select benefits
without regard to age, sex or health.
(k) "Employee" means and includes each officer or employee
in the service of a department who (1) receives his
compensation for service rendered to the department on a
warrant issued pursuant to a payroll certified by a department
or on a warrant or check issued and drawn by a department upon
a trust, federal or other fund or on a warrant issued pursuant
to a payroll certified by an elected or duly appointed officer
of the State or who receives payment of the performance of
personal services on a warrant issued pursuant to a payroll

SB3073 - 7 - LRB103 37686 RPS 67813 b
certified by a Department and drawn by the Comptroller upon
the State Treasurer against appropriations made by the General
Assembly from any fund or against trust funds held by the State
Treasurer, and (2) is employed full-time or part-time in a
position normally requiring actual performance of duty during
not less than 1/2 of a normal work period, as established by
the Director in cooperation with each department, except that
persons elected by popular vote will be considered employees
during the entire term for which they are elected regardless
of hours devoted to the service of the State, and (3) except
that "employee" does not include any person who is not
eligible by reason of such person's employment to participate
in one of the State retirement systems under Articles 2, 14, 15
(either the regular Article 15 system or the optional
retirement program established under Section 15-158.2), or 18,
or under paragraph (2), (3), or (5) of Section 16-106, of the
Illinois Pension Code, but such term does include persons who
are employed during the 6-month qualifying period under
Article 14 of the Illinois Pension Code. Such term also
includes any person who (1) after January 1, 1966, is
receiving ordinary or accidental disability benefits under
Articles 2, 14, or 15 (including ordinary or accidental
disability benefits under the optional retirement program
established under Section 15-158.2), paragraph (2), (3), or
(5) of Section 16-106, or Article 18 of the Illinois Pension
Code, for disability incurred after January 1, 1966, (2)

SB3073 - 8 - LRB103 37686 RPS 67813 b
receives total permanent or total temporary disability under
the Workers' Compensation Act or Occupational Disease Act as a
result of injuries sustained or illness contracted in the
course of employment with the State of Illinois, or (3) is not
otherwise covered under this Act and has retired as a
participating member under Article 2 of the Illinois Pension
Code but is ineligible for the retirement annuity under
Section 2-119 of the Illinois Pension Code. However, a person
who satisfies the criteria of the foregoing definition of
"employee" except that such person is made ineligible to
participate in the State Universities Retirement System by
clause (4) of subsection (a) of Section 15-107 of the Illinois
Pension Code is also an "employee" for the purposes of this
Act. "Employee" also includes any person receiving or eligible
for benefits under a sick pay plan established in accordance
with Section 36 of the State Finance Act. "Employee" also
includes (i) each officer or employee in the service of a
qualified local government, including persons appointed as
trustees of sanitary districts regardless of hours devoted to
the service of the sanitary district, (ii) each employee in
the service of a qualified rehabilitation facility, (iii) each
full-time employee in the service of a qualified domestic
violence shelter or service, and (iv) each full-time employee
in the service of a qualified child advocacy center, as
determined according to rules promulgated by the Director.
(l) "Member" means an employee, annuitant, retired

SB3073 - 9 - LRB103 37686 RPS 67813 b
employee, or survivor. In the case of an annuitant or retired
employee who first becomes an annuitant or retired employee on
or after January 13, 2012 (the effective date of Public Act
97-668), the individual must meet the minimum vesting
requirements of the applicable retirement system in order to
be eligible for group insurance benefits under that system. In
the case of a survivor who is not entitled to occupational
death benefits pursuant to an applicable retirement system or
death benefits pursuant to the Illinois Workers' Compensation
Act, and who first becomes a survivor on or after January 13,
2012 (the effective date of Public Act 97-668), the deceased
employee, annuitant, or retired employee upon whom the annuity
is based must have been eligible to participate in the group
insurance system under the applicable retirement system in
order for the survivor to be eligible for group insurance
benefits under that system.
In the case of a survivor who is entitled to occupational
death benefits pursuant to the deceased employee's applicable
retirement system or death benefits pursuant to the Illinois
Workers' Compensation Act, and first becomes a survivor on or
after January 1, 2022, the survivor is eligible for group
health insurance benefits regardless of the deceased
employee's minimum vesting requirements under the applicable
retirement system, with a State contribution rate of 100%,
until an unmarried child dependent reaches the age of 18, or
the age of 22 if the dependent child is a full-time student, or

SB3073 - 10 - LRB103 37686 RPS 67813 b
until the adult survivor becomes eligible for benefits under
the federal Medicare health insurance program (Title XVIII of
the Social Security Act, as added by Public Law 89-97). In the
case of a survivor currently receiving occupational death
benefits pursuant to the deceased employee's applicable
retirement system or has received death benefits pursuant to
the Illinois Workers' Compensation Act, who first became a
survivor prior to January 1, 2022, the survivor is eligible
for group health insurance benefits regardless of the deceased
employee's minimum vesting requirements under the applicable
retirement system, with a State contribution rate of 100%,
until an unmarried child dependent reaches the age of 18, or
the age of 22 if the dependent child is a full-time student, or
until the adult survivor becomes eligible for benefits under
the federal Medicare health insurance program (Title XVIII of
the Social Security Act, as added by Public Law 89-97). The
changes made by this amendatory Act of the 102nd General
Assembly with respect to survivors who first became survivors
prior to January 1, 2022 shall apply upon request of the
survivor on or after the effective date of this amendatory Act
of the 102nd General Assembly.
(m) "Optional coverages or benefits" means those coverages
or benefits available to the member on his or her voluntary
election, and at his or her own expense.
(n) "Program" means the group life insurance, health
benefits and other employee benefits designed and contracted

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for by the Director under this Act.
(o) "Health plan" means a health benefits program offered
by the State of Illinois for persons eligible for the plan.
(p) "Retired employee" means any person who would be an
annuitant as that term is defined herein but for the fact that
such person retired prior to January 1, 1966. Such term also
includes any person formerly employed by the University of
Illinois in the Cooperative Extension Service who would be an
annuitant but for the fact that such person was made
ineligible to participate in the State Universities Retirement
System by clause (4) of subsection (a) of Section 15-107 of the
Illinois Pension Code.
(q) "Survivor" means a person receiving an annuity as a
survivor of an employee or of an annuitant. "Survivor" also
includes: (1) the surviving dependent of a person who
satisfies the definition of "employee" except that such person
is made ineligible to participate in the State Universities
Retirement System by clause (4) of subsection (a) of Section
15-107 of the Illinois Pension Code; (2) the surviving
dependent of any person formerly employed by the University of
Illinois in the Cooperative Extension Service who would be an
annuitant except for the fact that such person was made
ineligible to participate in the State Universities Retirement
System by clause (4) of subsection (a) of Section 15-107 of the
Illinois Pension Code; (3) the surviving dependent of a person
who was an annuitant under this Act by virtue of receiving an

SB3073 - 12 - LRB103 37686 RPS 67813 b
alternative retirement cancellation payment under Section
14-108.5 of the Illinois Pension Code; and (4) a person who
would be receiving an annuity as a survivor of an annuitant
except that the annuitant elected on or after June 4, 2018 to
receive an accelerated pension benefit payment under Section
14-147.5, 15-185.5, or 16-190.5 of the Illinois Pension Code
in lieu of receiving an annuity.
(q-2) "SERS" means the State Employees' Retirement System
of Illinois, created under Article 14 of the Illinois Pension
Code.
(q-3) "SURS" means the State Universities Retirement
System, created under Article 15 of the Illinois Pension Code.
(q-4) "TRS" means the Teachers' Retirement System of the
State of Illinois, created under Article 16 of the Illinois
Pension Code.
(q-5) (Blank).
(q-6) (Blank).
(q-7) (Blank).
(r) "Medical services" means the services provided within
the scope of their licenses by practitioners in all categories
licensed under the Medical Practice Act of 1987.
(s) "Unit of local government" means any county,
municipality, township, school district (including a
combination of school districts under the Intergovernmental
Cooperation Act), special district or other unit, designated
as a unit of local government by law, which exercises limited

SB3073 - 13 - LRB103 37686 RPS 67813 b
governmental powers or powers in respect to limited
governmental subjects, any not-for-profit association with a
membership that primarily includes townships and township
officials, that has duties that include provision of research
service, dissemination of information, and other acts for the
purpose of improving township government, and that is funded
wholly or partly in accordance with Section 85-15 of the
Township Code; any not-for-profit corporation or association,
with a membership consisting primarily of municipalities, that
operates its own utility system, and provides research,
training, dissemination of information, or other acts to
promote cooperation between and among municipalities that
provide utility services and for the advancement of the goals
and purposes of its membership; the Southern Illinois
Collegiate Common Market, which is a consortium of higher
education institutions in Southern Illinois; the Illinois
Association of Park Districts; and any hospital provider that
is owned by a county that has 100 or fewer hospital beds and
has not already joined the program. "Qualified local
government" means a unit of local government approved by the
Director and participating in a program created under
subsection (i) of Section 10 of this Act.
(t) "Qualified rehabilitation facility" means any
not-for-profit organization that is accredited by the
Commission on Accreditation of Rehabilitation Facilities or
certified by the Department of Human Services (as successor to

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the Department of Mental Health and Developmental
Disabilities) to provide services to persons with disabilities
and which receives funds from the State of Illinois for
providing those services, approved by the Director and
participating in a program created under subsection (j) of
Section 10 of this Act.
(u) "Qualified domestic violence shelter or service" means
any Illinois domestic violence shelter or service and its
administrative offices funded by the Department of Human
Services (as successor to the Illinois Department of Public
Aid), approved by the Director and participating in a program
created under subsection (k) of Section 10.
(v) "TRS benefit recipient" means a person who:
(1) is not a "member" as defined in this Section; and
(2) is receiving a monthly benefit or retirement
annuity under Article 16 of the Illinois Pension Code or
would be receiving such monthly benefit or retirement
annuity except that the benefit recipient elected on or
after June 4, 2018 to receive an accelerated pension
benefit payment under Section 16-190.5 of the Illinois
Pension Code in lieu of receiving an annuity; and
(3) either (i) has at least 8 years of creditable
service under Article 16 of the Illinois Pension Code, or
(ii) was enrolled in the health insurance program offered
under that Article on January 1, 1996, or (iii) is the
survivor of a benefit recipient who had at least 8 years of

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creditable service under Article 16 of the Illinois
Pension Code or was enrolled in the health insurance
program offered under that Article on June 21, 1995 (the
effective date of Public Act 89-25), or (iv) is a
recipient or survivor of a recipient of a disability
benefit under Article 16 of the Illinois Pension Code.
(w) "TRS dependent beneficiary" means a person who:
(1) is not a "member" or "dependent" as defined in
this Section; and
(2) is a TRS benefit recipient's: (A) spouse, (B)
dependent parent who is receiving at least half of his or
her support from the TRS benefit recipient, or (C)
natural, step, adjudicated, or adopted child who is (i)
under age 26, (ii) was, on January 1, 1996, participating
as a dependent beneficiary in the health insurance program
offered under Article 16 of the Illinois Pension Code, or
(iii) age 19 or over who has a mental or physical
disability from a cause originating prior to the age of 19
(age 26 if enrolled as an adult child).
"TRS dependent beneficiary" does not include, as indicated
under paragraph (2) of this subsection (w), a dependent of the
survivor of a TRS benefit recipient who first becomes a
dependent of a survivor of a TRS benefit recipient on or after
January 13, 2012 (the effective date of Public Act 97-668)
unless that dependent would have been eligible for coverage as
a dependent of the deceased TRS benefit recipient upon whom

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the survivor benefit is based.
(x) "Military leave" refers to individuals in basic
training for reserves, special/advanced training, annual
training, emergency call up, activation by the President of
the United States, or any other training or duty in service to
the United States Armed Forces.
(y) (Blank).
(z) "Community college benefit recipient" means a person
who:
(1) is not a "member" as defined in this Section; and
(2) is receiving a monthly survivor's annuity or
retirement annuity under Article 15 of the Illinois
Pension Code or would be receiving such monthly survivor's
annuity or retirement annuity except that the benefit
recipient elected on or after June 4, 2018 to receive an
accelerated pension benefit payment under Section 15-185.5
of the Illinois Pension Code in lieu of receiving an
annuity; and
(3) either (i) was a full-time employee of a community
college district or an association of community college
boards created under the Public Community College Act
(other than an employee whose last employer under Article
15 of the Illinois Pension Code was a community college
district subject to Article VII of the Public Community
College Act) and was eligible to participate in a group
health benefit plan as an employee during the time of

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employment with a community college district (other than a
community college district subject to Article VII of the
Public Community College Act) or an association of
community college boards, or (ii) is the survivor of a
person described in item (i).
(aa) "Community college dependent beneficiary" means a
person who:
(1) is not a "member" or "dependent" as defined in
this Section; and
(2) is a community college benefit recipient's: (A)
spouse, (B) dependent parent who is receiving at least
half of his or her support from the community college
benefit recipient, or (C) natural, step, adjudicated, or
adopted child who is (i) under age 26, or (ii) age 19 or
over and has a mental or physical disability from a cause
originating prior to the age of 19 (age 26 if enrolled as
an adult child).
"Community college dependent beneficiary" does not
include, as indicated under paragraph (2) of this subsection
(aa), a dependent of the survivor of a community college
benefit recipient who first becomes a dependent of a survivor
of a community college benefit recipient on or after January
13, 2012 (the effective date of Public Act 97-668) unless that
dependent would have been eligible for coverage as a dependent
of the deceased community college benefit recipient upon whom
the survivor annuity is based.

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(bb) "Qualified child advocacy center" means any Illinois
child advocacy center and its administrative offices funded by
the Department of Children and Family Services, as defined by
the Children's Advocacy Center Act (55 ILCS 80/), approved by
the Director and participating in a program created under
subsection (n) of Section 10.
(cc) "Placement for adoption" means the assumption and
retention by a member of a legal obligation for total or
partial support of a child in anticipation of adoption of the
child. The child's placement with the member terminates upon
the termination of such legal obligation.
(Source: P.A. 101-242, eff. 8-9-19; 102-558, eff. 8-20-21;
102-714, eff. 4-29-22; 102-813, eff 5-13-22.)
(5 ILCS 375/10) (from Ch. 127, par. 530)
Sec. 10. Contributions by the State and members.
(a) The State shall pay the cost of basic non-contributory
group life insurance and, subject to member paid contributions
set by the Department or required by this Section and except as
provided in this Section, the basic program of group health
benefits on each eligible member, except a member, not
otherwise covered by this Act, who has retired as a
participating member under Article 2 of the Illinois Pension
Code but is ineligible for the retirement annuity under
Section 2-119 of the Illinois Pension Code, and part of each
eligible member's and retired member's premiums for health

SB3073 - 19 - LRB103 37686 RPS 67813 b
insurance coverage for enrolled dependents as provided by
Section 9. The State shall pay the cost of the basic program of
group health benefits only after benefits are reduced by the
amount of benefits covered by Medicare for all members and
dependents who are eligible for benefits under Social Security
or the Railroad Retirement system or who had sufficient
Medicare-covered government employment, except that such
reduction in benefits shall apply only to those members and
dependents who (1) first become eligible for such Medicare
coverage on or after July 1, 1992; or (2) are
Medicare-eligible members or dependents of a local government
unit which began participation in the program on or after July
1, 1992; or (3) remain eligible for, but no longer receive
Medicare coverage which they had been receiving on or after
July 1, 1992. The Department may determine the aggregate level
of the State's contribution on the basis of actual cost of
medical services adjusted for age, sex or geographic or other
demographic characteristics which affect the costs of such
programs.
The cost of participation in the basic program of group
health benefits for the dependent or survivor of a living or
deceased retired employee who was formerly employed by the
University of Illinois in the Cooperative Extension Service
and would be an annuitant but for the fact that he or she was
made ineligible to participate in the State Universities
Retirement System by clause (4) of subsection (a) of Section

SB3073 - 20 - LRB103 37686 RPS 67813 b
15-107 of the Illinois Pension Code shall not be greater than
the cost of participation that would otherwise apply to that
dependent or survivor if he or she were the dependent or
survivor of an annuitant under the State Universities
Retirement System.
(a-1) (Blank).
(a-2) (Blank).
(a-3) (Blank).
(a-4) (Blank).
(a-5) (Blank).
(a-6) (Blank).
(a-7) (Blank).
(a-8) Any annuitant, survivor, or retired employee may
waive or terminate coverage in the program of group health
benefits. Any such annuitant, survivor, or retired employee
who has waived or terminated coverage may enroll or re-enroll
in the program of group health benefits only during the annual
benefit choice period, as determined by the Director; except
that in the event of termination of coverage due to nonpayment
of premiums, the annuitant, survivor, or retired employee may
not re-enroll in the program.
(a-8.5) Beginning on the effective date of this amendatory
Act of the 97th General Assembly, the Director of Central
Management Services shall, on an annual basis, determine the
amount that the State shall contribute toward the basic
program of group health benefits on behalf of annuitants

SB3073 - 21 - LRB103 37686 RPS 67813 b
(including individuals who (i) participated in the General
Assembly Retirement System, the State Employees' Retirement
System of Illinois, the State Universities Retirement System,
the Teachers' Retirement System of the State of Illinois, or
the Judges Retirement System of Illinois and (ii) qualify as
annuitants under subsection (b) of Section 3 of this Act),
survivors (including individuals who (i) receive an annuity as
a survivor of an individual who participated in the General
Assembly Retirement System, the State Employees' Retirement
System of Illinois, the State Universities Retirement System,
the Teachers' Retirement System of the State of Illinois, or
the Judges Retirement System of Illinois and (ii) qualify as
survivors under subsection (q) of Section 3 of this Act), and
retired employees (as defined in subsection (p) of Section 3
of this Act). The remainder of the cost of coverage for each
annuitant, survivor, or retired employee, as determined by the
Director of Central Management Services, shall be the
responsibility of that annuitant, survivor, or retired
employee.
Contributions required of annuitants, survivors, and
retired employees shall be the same for all retirement systems
and shall also be based on whether an individual has made an
election under Section 15-135.1 of the Illinois Pension Code.
Contributions may be based on annuitants', survivors', or
retired employees' Medicare eligibility, but may not be based
on Social Security eligibility.

SB3073 - 22 - LRB103 37686 RPS 67813 b
(a-9) No later than May 1 of each calendar year, the
Director of Central Management Services shall certify in
writing to the Executive Secretary of the State Employees'
Retirement System of Illinois the amounts of the Medicare
supplement health care premiums and the amounts of the health
care premiums for all other retirees who are not Medicare
eligible.
A separate calculation of the premiums based upon the
actual cost of each health care plan shall be so certified.
The Director of Central Management Services shall provide
to the Executive Secretary of the State Employees' Retirement
System of Illinois such information, statistics, and other
data as he or she may require to review the premium amounts
certified by the Director of Central Management Services.
The Department of Central Management Services, or any
successor agency designated to procure healthcare contracts
pursuant to this Act, is authorized to establish funds,
separate accounts provided by any bank or banks as defined by
the Illinois Banking Act, or separate accounts provided by any
savings and loan association or associations as defined by the
Illinois Savings and Loan Act of 1985 to be held by the
Director, outside the State treasury, for the purpose of
receiving the transfer of moneys from the Local Government
Health Insurance Reserve Fund. The Department may promulgate
rules further defining the methodology for the transfers. Any
interest earned by moneys in the funds or accounts shall inure

SB3073 - 23 - LRB103 37686 RPS 67813 b
to the Local Government Health Insurance Reserve Fund. The
transferred moneys, and interest accrued thereon, shall be
used exclusively for transfers to administrative service
organizations or their financial institutions for payments of
claims to claimants and providers under the self-insurance
health plan. The transferred moneys, and interest accrued
thereon, shall not be used for any other purpose including,
but not limited to, reimbursement of administration fees due
the administrative service organization pursuant to its
contract or contracts with the Department.
(a-10) To the extent that participation, benefits, or
premiums under this Act are based on a person's service credit
under an Article of the Illinois Pension Code, service credit
terminated in exchange for an accelerated pension benefit
payment under Section 14-147.5, 15-185.5, or 16-190.5 of that
Code shall be included in determining a person's service
credit for the purposes of this Act.
(a-15) For purposes of determining State contributions
under this Section, service established under a defined
contribution plan under Section 14-155.5 of the Illinois
Pension Code shall be included in determining an employee's
creditable service. Any credit terminated as part of a
transfer of contributions to a defined contribution plan under
Section 14-155.5 of the Illinois Pension Code shall also be
included in determining an employee's creditable service.
(b) State employees who become eligible for this program

SB3073 - 24 - LRB103 37686 RPS 67813 b
on or after January 1, 1980 in positions normally requiring
actual performance of duty not less than 1/2 of a normal work
period but not equal to that of a normal work period, shall be
given the option of participating in the available program. If
the employee elects coverage, the State shall contribute on
behalf of such employee to the cost of the employee's benefit
and any applicable dependent supplement, that sum which bears
the same percentage as that percentage of time the employee
regularly works when compared to normal work period.
(c) The basic non-contributory coverage from the basic
program of group health benefits shall be continued for each
employee not in pay status or on active service by reason of
(1) leave of absence due to illness or injury, (2) authorized
educational leave of absence or sabbatical leave, or (3)
military leave. This coverage shall continue until expiration
of authorized leave and return to active service, but not to
exceed 24 months for leaves under item (1) or (2). This
24-month limitation and the requirement of returning to active
service shall not apply to persons receiving ordinary or
accidental disability benefits or retirement benefits through
the appropriate State retirement system or benefits under the
Workers' Compensation or Occupational Disease Act.
(d) The basic group life insurance coverage shall
continue, with full State contribution, where such person is
(1) absent from active service by reason of disability arising
from any cause other than self-inflicted, (2) on authorized

SB3073 - 25 - LRB103 37686 RPS 67813 b
educational leave of absence or sabbatical leave, or (3) on
military leave.
(e) Where the person is in non-pay status for a period in
excess of 30 days or on leave of absence, other than by reason
of disability, educational or sabbatical leave, or military
leave, such person may continue coverage only by making
personal payment equal to the amount normally contributed by
the State on such person's behalf. Such payments and coverage
may be continued: (1) until such time as the person returns to
a status eligible for coverage at State expense, but not to
exceed 24 months or (2) until such person's employment or
annuitant status with the State is terminated (exclusive of
any additional service imposed pursuant to law).
(f) The Department shall establish by rule the extent to
which other employee benefits will continue for persons in
non-pay status or who are not in active service.
(g) The State shall not pay the cost of the basic
non-contributory group life insurance, program of health
benefits and other employee benefits for members who are
survivors as defined by paragraphs (1) and (2) of subsection
(q) of Section 3 of this Act. The costs of benefits for these
survivors shall be paid by the survivors or by the University
of Illinois Cooperative Extension Service, or any combination
thereof. However, the State shall pay the amount of the
reduction in the cost of participation, if any, resulting from
the amendment to subsection (a) made by this amendatory Act of

SB3073 - 26 - LRB103 37686 RPS 67813 b
the 91st General Assembly.
(h) Those persons occupying positions with any department
as a result of emergency appointments pursuant to Section 8b.8
of the Personnel Code who are not considered employees under
this Act shall be given the option of participating in the
programs of group life insurance, health benefits and other
employee benefits. Such persons electing coverage may
participate only by making payment equal to the amount
normally contributed by the State for similarly situated
employees. Such amounts shall be determined by the Director.
Such payments and coverage may be continued until such time as
the person becomes an employee pursuant to this Act or such
person's appointment is terminated.
(i) Any unit of local government within the State of
Illinois may apply to the Director to have its employees,
annuitants, and their dependents provided group health
coverage under this Act on a non-insured basis. To
participate, a unit of local government must agree to enroll
all of its employees, who may select coverage under any group
health benefits plan made available by the Department under
the health benefits program established under this Section or
a health maintenance organization that has contracted with the
State to be available as a health care provider for employees
as defined in this Act. A unit of local government must remit
the entire cost of providing coverage under the health
benefits program established under this Section or, for

SB3073 - 27 - LRB103 37686 RPS 67813 b
coverage under a health maintenance organization, an amount
determined by the Director based on an analysis of the sex,
age, geographic location, or other relevant demographic
variables for its employees, except that the unit of local
government shall not be required to enroll those of its
employees who are covered spouses or dependents under the
State group health benefits plan or another group policy or
plan providing health benefits as long as (1) an appropriate
official from the unit of local government attests that each
employee not enrolled is a covered spouse or dependent under
this plan or another group policy or plan, and (2) at least 50%
of the employees are enrolled and the unit of local government
remits the entire cost of providing coverage to those
employees, except that a participating school district must
have enrolled at least 50% of its full-time employees who have
not waived coverage under the district's group health plan by
participating in a component of the district's cafeteria plan.
A participating school district is not required to enroll a
full-time employee who has waived coverage under the
district's health plan, provided that an appropriate official
from the participating school district attests that the
full-time employee has waived coverage by participating in a
component of the district's cafeteria plan. For the purposes
of this subsection, "participating school district" includes a
unit of local government whose primary purpose is education as
defined by the Department's rules.

SB3073 - 28 - LRB103 37686 RPS 67813 b
Employees of a participating unit of local government who
are not enrolled due to coverage under another group health
policy or plan may enroll in the event of a qualifying change
in status, special enrollment, special circumstance as defined
by the Director, or during the annual Benefit Choice Period. A
participating unit of local government may also elect to cover
its annuitants. Dependent coverage shall be offered on an
optional basis, with the costs paid by the unit of local
government, its employees, or some combination of the two as
determined by the unit of local government. The unit of local
government shall be responsible for timely collection and
transmission of dependent premiums.
The Director shall annually determine monthly rates of
payment, subject to the following constraints:
(1) In the first year of coverage, the rates shall be
equal to the amount normally charged to State employees
for elected optional coverages or for enrolled dependents
coverages or other contributory coverages, or contributed
by the State for basic insurance coverages on behalf of
its employees, adjusted for differences between State
employees and employees of the local government in age,
sex, geographic location or other relevant demographic
variables, plus an amount sufficient to pay for the
additional administrative costs of providing coverage to
employees of the unit of local government and their
dependents.

SB3073 - 29 - LRB103 37686 RPS 67813 b
(2) In subsequent years, a further adjustment shall be
made to reflect the actual prior years' claims experience
of the employees of the unit of local government.
In the case of coverage of local government employees
under a health maintenance organization, the Director shall
annually determine for each participating unit of local
government the maximum monthly amount the unit may contribute
toward that coverage, based on an analysis of (i) the age, sex,
geographic location, and other relevant demographic variables
of the unit's employees and (ii) the cost to cover those
employees under the State group health benefits plan. The
Director may similarly determine the maximum monthly amount
each unit of local government may contribute toward coverage
of its employees' dependents under a health maintenance
organization.
Monthly payments by the unit of local government or its
employees for group health benefits plan or health maintenance
organization coverage shall be deposited in the Local
Government Health Insurance Reserve Fund.
The Local Government Health Insurance Reserve Fund is
hereby created as a nonappropriated trust fund to be held
outside the State Treasury, with the State Treasurer as
custodian. The Local Government Health Insurance Reserve Fund
shall be a continuing fund not subject to fiscal year
limitations. The Local Government Health Insurance Reserve
Fund is not subject to administrative charges or charge-backs,

SB3073 - 30 - LRB103 37686 RPS 67813 b
including but not limited to those authorized under Section 8h
of the State Finance Act. All revenues arising from the
administration of the health benefits program established
under this Section shall be deposited into the Local
Government Health Insurance Reserve Fund. Any interest earned
on moneys in the Local Government Health Insurance Reserve
Fund shall be deposited into the Fund. All expenditures from
this Fund shall be used for payments for health care benefits
for local government and rehabilitation facility employees,
annuitants, and dependents, and to reimburse the Department or
its administrative service organization for all expenses
incurred in the administration of benefits. No other State
funds may be used for these purposes.
A local government employer's participation or desire to
participate in a program created under this subsection shall
not limit that employer's duty to bargain with the
representative of any collective bargaining unit of its
employees.
(j) Any rehabilitation facility within the State of
Illinois may apply to the Director to have its employees,
annuitants, and their eligible dependents provided group
health coverage under this Act on a non-insured basis. To
participate, a rehabilitation facility must agree to enroll
all of its employees and remit the entire cost of providing
such coverage for its employees, except that the
rehabilitation facility shall not be required to enroll those

SB3073 - 31 - LRB103 37686 RPS 67813 b
of its employees who are covered spouses or dependents under
this plan or another group policy or plan providing health
benefits as long as (1) an appropriate official from the
rehabilitation facility attests that each employee not
enrolled is a covered spouse or dependent under this plan or
another group policy or plan, and (2) at least 50% of the
employees are enrolled and the rehabilitation facility remits
the entire cost of providing coverage to those employees.
Employees of a participating rehabilitation facility who are
not enrolled due to coverage under another group health policy
or plan may enroll in the event of a qualifying change in
status, special enrollment, special circumstance as defined by
the Director, or during the annual Benefit Choice Period. A
participating rehabilitation facility may also elect to cover
its annuitants. Dependent coverage shall be offered on an
optional basis, with the costs paid by the rehabilitation
facility, its employees, or some combination of the 2 as
determined by the rehabilitation facility. The rehabilitation
facility shall be responsible for timely collection and
transmission of dependent premiums.
The Director shall annually determine quarterly rates of
payment, subject to the following constraints:
(1) In the first year of coverage, the rates shall be
equal to the amount normally charged to State employees
for elected optional coverages or for enrolled dependents
coverages or other contributory coverages on behalf of its

SB3073 - 32 - LRB103 37686 RPS 67813 b
employees, adjusted for differences between State
employees and employees of the rehabilitation facility in
age, sex, geographic location or other relevant
demographic variables, plus an amount sufficient to pay
for the additional administrative costs of providing
coverage to employees of the rehabilitation facility and
their dependents.
(2) In subsequent years, a further adjustment shall be
made to reflect the actual prior years' claims experience
of the employees of the rehabilitation facility.
Monthly payments by the rehabilitation facility or its
employees for group health benefits shall be deposited in the
Local Government Health Insurance Reserve Fund.
(k) Any domestic violence shelter or service within the
State of Illinois may apply to the Director to have its
employees, annuitants, and their dependents provided group
health coverage under this Act on a non-insured basis. To
participate, a domestic violence shelter or service must agree
to enroll all of its employees and pay the entire cost of
providing such coverage for its employees. The domestic
violence shelter shall not be required to enroll those of its
employees who are covered spouses or dependents under this
plan or another group policy or plan providing health benefits
as long as (1) an appropriate official from the domestic
violence shelter attests that each employee not enrolled is a
covered spouse or dependent under this plan or another group

SB3073 - 33 - LRB103 37686 RPS 67813 b
policy or plan and (2) at least 50% of the employees are
enrolled and the domestic violence shelter remits the entire
cost of providing coverage to those employees. Employees of a
participating domestic violence shelter who are not enrolled
due to coverage under another group health policy or plan may
enroll in the event of a qualifying change in status, special
enrollment, or special circumstance as defined by the Director
or during the annual Benefit Choice Period. A participating
domestic violence shelter may also elect to cover its
annuitants. Dependent coverage shall be offered on an optional
basis, with employees, or some combination of the 2 as
determined by the domestic violence shelter or service. The
domestic violence shelter or service shall be responsible for
timely collection and transmission of dependent premiums.
The Director shall annually determine rates of payment,
subject to the following constraints:
(1) In the first year of coverage, the rates shall be
equal to the amount normally charged to State employees
for elected optional coverages or for enrolled dependents
coverages or other contributory coverages on behalf of its
employees, adjusted for differences between State
employees and employees of the domestic violence shelter
or service in age, sex, geographic location or other
relevant demographic variables, plus an amount sufficient
to pay for the additional administrative costs of
providing coverage to employees of the domestic violence

SB3073 - 34 - LRB103 37686 RPS 67813 b
shelter or service and their dependents.
(2) In subsequent years, a further adjustment shall be
made to reflect the actual prior years' claims experience
of the employees of the domestic violence shelter or
service.
Monthly payments by the domestic violence shelter or
service or its employees for group health insurance shall be
deposited in the Local Government Health Insurance Reserve
Fund.
(l) A public community college or entity organized
pursuant to the Public Community College Act may apply to the
Director initially to have only annuitants not covered prior
to July 1, 1992 by the district's health plan provided health
coverage under this Act on a non-insured basis. The community
college must execute a 2-year contract to participate in the
Local Government Health Plan. Any annuitant may enroll in the
event of a qualifying change in status, special enrollment,
special circumstance as defined by the Director, or during the
annual Benefit Choice Period.
The Director shall annually determine monthly rates of
payment subject to the following constraints: for those
community colleges with annuitants only enrolled, first year
rates shall be equal to the average cost to cover claims for a
State member adjusted for demographics, Medicare
participation, and other factors; and in the second year, a
further adjustment of rates shall be made to reflect the

SB3073 - 35 - LRB103 37686 RPS 67813 b
actual first year's claims experience of the covered
annuitants.
(l-5) The provisions of subsection (l) become inoperative
on July 1, 1999.
(m) The Director shall adopt any rules deemed necessary
for implementation of this amendatory Act of 1989 (Public Act
86-978).
(n) Any child advocacy center within the State of Illinois
may apply to the Director to have its employees, annuitants,
and their dependents provided group health coverage under this
Act on a non-insured basis. To participate, a child advocacy
center must agree to enroll all of its employees and pay the
entire cost of providing coverage for its employees. The child
advocacy center shall not be required to enroll those of its
employees who are covered spouses or dependents under this
plan or another group policy or plan providing health benefits
as long as (1) an appropriate official from the child advocacy
center attests that each employee not enrolled is a covered
spouse or dependent under this plan or another group policy or
plan and (2) at least 50% of the employees are enrolled and the
child advocacy center remits the entire cost of providing
coverage to those employees. Employees of a participating
child advocacy center who are not enrolled due to coverage
under another group health policy or plan may enroll in the
event of a qualifying change in status, special enrollment, or
special circumstance as defined by the Director or during the

SB3073 - 36 - LRB103 37686 RPS 67813 b
annual Benefit Choice Period. A participating child advocacy
center may also elect to cover its annuitants. Dependent
coverage shall be offered on an optional basis, with the costs
paid by the child advocacy center, its employees, or some
combination of the 2 as determined by the child advocacy
center. The child advocacy center shall be responsible for
timely collection and transmission of dependent premiums.
The Director shall annually determine rates of payment,
subject to the following constraints:
(1) In the first year of coverage, the rates shall be
equal to the amount normally charged to State employees
for elected optional coverages or for enrolled dependents
coverages or other contributory coverages on behalf of its
employees, adjusted for differences between State
employees and employees of the child advocacy center in
age, sex, geographic location, or other relevant
demographic variables, plus an amount sufficient to pay
for the additional administrative costs of providing
coverage to employees of the child advocacy center and
their dependents.
(2) In subsequent years, a further adjustment shall be
made to reflect the actual prior years' claims experience
of the employees of the child advocacy center.
Monthly payments by the child advocacy center or its
employees for group health insurance shall be deposited into
the Local Government Health Insurance Reserve Fund.

SB3073 - 37 - LRB103 37686 RPS 67813 b
(Source: P.A. 102-19, eff. 7-1-21.)
Section 10. The Illinois Pension Code is amended by
changing Sections 1-160, 1-161, 14-103.05, 14-103.41,
14-152.1, 20-121, 20-123, 20-124, and 20-125 and by adding
Section 14-155.5 as follows:
(40 ILCS 5/1-160)
(Text of Section from P.A. 102-719)
Sec. 1-160. Provisions applicable to new hires.
(a) The provisions of this Section apply to a person who,
on or after January 1, 2011, first becomes a member or a
participant under any reciprocal retirement system or pension
fund established under this Code, other than a retirement
system or pension fund established under Article 2, 3, 4, 5, 6,
7, 15, or 18 of this Code, notwithstanding any other provision
of this Code to the contrary, but do not apply to any
self-managed plan established under this Code or to any
participant of the retirement plan established under Section
22-101; except that this Section applies to a person who
elected to establish alternative credits by electing in
writing after January 1, 2011, but before August 8, 2011,
under Section 7-145.1 of this Code. Notwithstanding anything
to the contrary in this Section, for purposes of this Section,
a person who is a Tier 1 regular employee as defined in Section
7-109.4 of this Code or who participated in a retirement

SB3073 - 38 - LRB103 37686 RPS 67813 b
system under Article 15 prior to January 1, 2011 shall be
deemed a person who first became a member or participant prior
to January 1, 2011 under any retirement system or pension fund
subject to this Section. The changes made to this Section by
Public Act 98-596 are a clarification of existing law and are
intended to be retroactive to January 1, 2011 (the effective
date of Public Act 96-889), notwithstanding the provisions of
Section 1-103.1 of this Code.
This Section does not apply to a person who first becomes a
noncovered employee under Article 14 on or after the
implementation date of the plan created under Section 1-161
for that Article, unless that person elects under subsection
(b) of Section 1-161 to instead receive the benefits provided
under this Section and the applicable provisions of that
Article.
This Section does not apply to a person who first becomes a
member or participant under Article 16 on or after the
implementation date of the plan created under Section 1-161
for that Article, unless that person elects under subsection
(b) of Section 1-161 to instead receive the benefits provided
under this Section and the applicable provisions of that
Article.
This Section does not apply to a person who elects under
subsection (c-5) of Section 1-161 to receive the benefits
under Section 1-161.
This Section does not apply to a person who first becomes a

SB3073 - 39 - LRB103 37686 RPS 67813 b
member or participant of an affected pension fund on or after 6
months after the resolution or ordinance date, as defined in
Section 1-162, unless that person elects under subsection (c)
of Section 1-162 to receive the benefits provided under this
Section and the applicable provisions of the Article under
which he or she is a member or participant.
This Section does not apply to a person who participates
in a defined contribution plan established under Section
14-155.5.
(b) "Final average salary" means, except as otherwise
provided in this subsection, the average monthly (or annual)
salary obtained by dividing the total salary or earnings
calculated under the Article applicable to the member or
participant during the 96 consecutive months (or 8 consecutive
years) of service within the last 120 months (or 10 years) of
service in which the total salary or earnings calculated under
the applicable Article was the highest by the number of months
(or years) of service in that period. For the purposes of a
person who first becomes a member or participant of any
retirement system or pension fund to which this Section
applies on or after January 1, 2011, in this Code, "final
average salary" shall be substituted for the following:
(1) (Blank).
(2) In Articles 8, 9, 10, 11, and 12, "highest average
annual salary for any 4 consecutive years within the last
10 years of service immediately preceding the date of

SB3073 - 40 - LRB103 37686 RPS 67813 b
withdrawal".
(3) In Article 13, "average final salary".
(4) In Article 14, "final average compensation".
(5) In Article 17, "average salary".
(6) In Section 22-207, "wages or salary received by
him at the date of retirement or discharge".
A member of the Teachers' Retirement System of the State
of Illinois who retires on or after June 1, 2021 and for whom
the 2020-2021 school year is used in the calculation of the
member's final average salary shall use the higher of the
following for the purpose of determining the member's final
average salary:
(A) the amount otherwise calculated under the first
paragraph of this subsection; or
(B) an amount calculated by the Teachers' Retirement
System of the State of Illinois using the average of the
monthly (or annual) salary obtained by dividing the total
salary or earnings calculated under Article 16 applicable
to the member or participant during the 96 months (or 8
years) of service within the last 120 months (or 10 years)
of service in which the total salary or earnings
calculated under the Article was the highest by the number
of months (or years) of service in that period.
(b-5) Beginning on January 1, 2011, for all purposes under
this Code (including without limitation the calculation of
benefits and employee contributions), the annual earnings,

SB3073 - 41 - LRB103 37686 RPS 67813 b
salary, or wages (based on the plan year) of a member or
participant to whom this Section applies shall not exceed
$106,800; however, that amount shall annually thereafter be
increased by the lesser of (i) 3% of that amount, including all
previous adjustments, or (ii) one-half the annual unadjusted
percentage increase (but not less than zero) in the consumer
price index-u for the 12 months ending with the September
preceding each November 1, including all previous adjustments.
For the purposes of this Section, "consumer price index-u"
means the index published by the Bureau of Labor Statistics of
the United States Department of Labor that measures the
average change in prices of goods and services purchased by
all urban consumers, United States city average, all items,
1982-84 = 100. The new amount resulting from each annual
adjustment shall be determined by the Public Pension Division
of the Department of Insurance and made available to the
boards of the retirement systems and pension funds by November
1 of each year.
(b-10) Beginning on January 1, 2024, for all purposes
under this Code (including, without limitation, the
calculation of benefits and employee contributions), the
annual earnings, salary, or wages (based on the plan year) of a
member or participant under Article 9 to whom this Section
applies shall include an annual earnings, salary, or wage cap
that tracks the Social Security wage base. Maximum annual
earnings, wages, or salary shall be the annual contribution

SB3073 - 42 - LRB103 37686 RPS 67813 b
and benefit base established for the applicable year by the
Commissioner of the Social Security Administration under the
federal Social Security Act.
However, in no event shall the annual earnings, salary, or
wages for the purposes of this Article and Article 9 exceed any
limitation imposed on annual earnings, salary, or wages under
Section 1-117. Under no circumstances shall the maximum amount
of annual earnings, salary, or wages be greater than the
amount set forth in this subsection (b-10) as a result of
reciprocal service or any provisions regarding reciprocal
services, nor shall the Fund under Article 9 be required to pay
any refund as a result of the application of this maximum
annual earnings, salary, and wage cap.
Nothing in this subsection (b-10) shall cause or otherwise
result in any retroactive adjustment of any employee
contributions. Nothing in this subsection (b-10) shall cause
or otherwise result in any retroactive adjustment of
disability or other payments made between January 1, 2011 and
January 1, 2024.
(c) A member or participant is entitled to a retirement
annuity upon written application if he or she has attained age
67 (age 65, with respect to service under Article 12 that is
subject to this Section, for a member or participant under
Article 12 who first becomes a member or participant under
Article 12 on or after January 1, 2022 or who makes the
election under item (i) of subsection (d-15) of this Section)

SB3073 - 43 - LRB103 37686 RPS 67813 b
and has at least 10 years of service credit and is otherwise
eligible under the requirements of the applicable Article.
A member or participant who has attained age 62 (age 60,
with respect to service under Article 12 that is subject to
this Section, for a member or participant under Article 12 who
first becomes a member or participant under Article 12 on or
after January 1, 2022 or who makes the election under item (i)
of subsection (d-15) of this Section) and has at least 10 years
of service credit and is otherwise eligible under the
requirements of the applicable Article may elect to receive
the lower retirement annuity provided in subsection (d) of
this Section.
(c-5) A person who first becomes a member or a participant
subject to this Section on or after July 6, 2017 (the effective
date of Public Act 100-23), notwithstanding any other
provision of this Code to the contrary, is entitled to a
retirement annuity under Article 8 or Article 11 upon written
application if he or she has attained age 65 and has at least
10 years of service credit and is otherwise eligible under the
requirements of Article 8 or Article 11 of this Code,
whichever is applicable.
(d) The retirement annuity of a member or participant who
is retiring after attaining age 62 (age 60, with respect to
service under Article 12 that is subject to this Section, for a
member or participant under Article 12 who first becomes a
member or participant under Article 12 on or after January 1,

SB3073 - 44 - LRB103 37686 RPS 67813 b
2022 or who makes the election under item (i) of subsection
(d-15) of this Section) with at least 10 years of service
credit shall be reduced by one-half of 1% for each full month
that the member's age is under age 67 (age 65, with respect to
service under Article 12 that is subject to this Section, for a
member or participant under Article 12 who first becomes a
member or participant under Article 12 on or after January 1,
2022 or who makes the election under item (i) of subsection
(d-15) of this Section).
(d-5) The retirement annuity payable under Article 8 or
Article 11 to an eligible person subject to subsection (c-5)
of this Section who is retiring at age 60 with at least 10
years of service credit shall be reduced by one-half of 1% for
each full month that the member's age is under age 65.
(d-10) Each person who first became a member or
participant under Article 8 or Article 11 of this Code on or
after January 1, 2011 and prior to July 6, 2017 (the effective
date of Public Act 100-23) shall make an irrevocable election
either:
(i) to be eligible for the reduced retirement age
provided in subsections (c-5) and (d-5) of this Section,
the eligibility for which is conditioned upon the member
or participant agreeing to the increases in employee
contributions for age and service annuities provided in
subsection (a-5) of Section 8-174 of this Code (for
service under Article 8) or subsection (a-5) of Section

SB3073 - 45 - LRB103 37686 RPS 67813 b
11-170 of this Code (for service under Article 11); or
(ii) to not agree to item (i) of this subsection
(d-10), in which case the member or participant shall
continue to be subject to the retirement age provisions in
subsections (c) and (d) of this Section and the employee
contributions for age and service annuity as provided in
subsection (a) of Section 8-174 of this Code (for service
under Article 8) or subsection (a) of Section 11-170 of
this Code (for service under Article 11).
The election provided for in this subsection shall be made
between October 1, 2017 and November 15, 2017. A person
subject to this subsection who makes the required election
shall remain bound by that election. A person subject to this
subsection who fails for any reason to make the required
election within the time specified in this subsection shall be
deemed to have made the election under item (ii).
(d-15) Each person who first becomes a member or
participant under Article 12 on or after January 1, 2011 and
prior to January 1, 2022 shall make an irrevocable election
either:
(i) to be eligible for the reduced retirement age
specified in subsections (c) and (d) of this Section, the
eligibility for which is conditioned upon the member or
participant agreeing to the increase in employee
contributions for service annuities specified in
subsection (b) of Section 12-150; or

SB3073 - 46 - LRB103 37686 RPS 67813 b
(ii) to not agree to item (i) of this subsection
(d-15), in which case the member or participant shall not
be eligible for the reduced retirement age specified in
subsections (c) and (d) of this Section and shall not be
subject to the increase in employee contributions for
service annuities specified in subsection (b) of Section
12-150.
The election provided for in this subsection shall be made
between January 1, 2022 and April 1, 2022. A person subject to
this subsection who makes the required election shall remain
bound by that election. A person subject to this subsection
who fails for any reason to make the required election within
the time specified in this subsection shall be deemed to have
made the election under item (ii).
(e) Any retirement annuity or supplemental annuity shall
be subject to annual increases on the January 1 occurring
either on or after the attainment of age 67 (age 65, with
respect to service under Article 12 that is subject to this
Section, for a member or participant under Article 12 who
first becomes a member or participant under Article 12 on or
after January 1, 2022 or who makes the election under item (i)
of subsection (d-15); and beginning on July 6, 2017 (the
effective date of Public Act 100-23), age 65 with respect to
service under Article 8 or Article 11 for eligible persons
who: (i) are subject to subsection (c-5) of this Section; or
(ii) made the election under item (i) of subsection (d-10) of

SB3073 - 47 - LRB103 37686 RPS 67813 b
this Section) or the first anniversary of the annuity start
date, whichever is later. Each annual increase shall be
calculated at 3% or one-half the annual unadjusted percentage
increase (but not less than zero) in the consumer price
index-u for the 12 months ending with the September preceding
each November 1, whichever is less, of the originally granted
retirement annuity. If the annual unadjusted percentage change
in the consumer price index-u for the 12 months ending with the
September preceding each November 1 is zero or there is a
decrease, then the annuity shall not be increased.
For the purposes of Section 1-103.1 of this Code, the
changes made to this Section by Public Act 102-263 are
applicable without regard to whether the employee was in
active service on or after August 6, 2021 (the effective date
of Public Act 102-263).
For the purposes of Section 1-103.1 of this Code, the
changes made to this Section by Public Act 100-23 are
applicable without regard to whether the employee was in
active service on or after July 6, 2017 (the effective date of
Public Act 100-23).
(f) The initial survivor's or widow's annuity of an
otherwise eligible survivor or widow of a retired member or
participant who first became a member or participant on or
after January 1, 2011 shall be in the amount of 66 2/3% of the
retired member's or participant's retirement annuity at the
date of death. In the case of the death of a member or

SB3073 - 48 - LRB103 37686 RPS 67813 b
participant who has not retired and who first became a member
or participant on or after January 1, 2011, eligibility for a
survivor's or widow's annuity shall be determined by the
applicable Article of this Code. The initial benefit shall be
66 2/3% of the earned annuity without a reduction due to age. A
child's annuity of an otherwise eligible child shall be in the
amount prescribed under each Article if applicable. Any
survivor's or widow's annuity shall be increased (1) on each
January 1 occurring on or after the commencement of the
annuity if the deceased member died while receiving a
retirement annuity or (2) in other cases, on each January 1
occurring after the first anniversary of the commencement of
the annuity. Each annual increase shall be calculated at 3% or
one-half the annual unadjusted percentage increase (but not
less than zero) in the consumer price index-u for the 12 months
ending with the September preceding each November 1, whichever
is less, of the originally granted survivor's annuity. If the
annual unadjusted percentage change in the consumer price
index-u for the 12 months ending with the September preceding
each November 1 is zero or there is a decrease, then the
annuity shall not be increased.
(g) The benefits in Section 14-110 apply if the person is a
fire fighter in the fire protection service of a department, a
security employee of the Department of Corrections or the
Department of Juvenile Justice, or a security employee of the
Department of Innovation and Technology, as those terms are

SB3073 - 49 - LRB103 37686 RPS 67813 b
defined in subsection (b) and subsection (c) of Section
14-110. A person who meets the requirements of this Section is
entitled to an annuity calculated under the provisions of
Section 14-110, in lieu of the regular or minimum retirement
annuity, only if the person has withdrawn from service with
not less than 20 years of eligible creditable service and has
attained age 60, regardless of whether the attainment of age
60 occurs while the person is still in service.
(g-5) The benefits in Section 14-110 apply if the person
is a State policeman, investigator for the Secretary of State,
conservation police officer, investigator for the Department
of Revenue or the Illinois Gaming Board, investigator for the
Office of the Attorney General, Commerce Commission police
officer, or arson investigator, as those terms are defined in
subsection (b) and subsection (c) of Section 14-110. A person
who meets the requirements of this Section is entitled to an
annuity calculated under the provisions of Section 14-110, in
lieu of the regular or minimum retirement annuity, only if the
person has withdrawn from service with not less than 20 years
of eligible creditable service and has attained age 55,
regardless of whether the attainment of age 55 occurs while
the person is still in service.
(h) If a person who first becomes a member or a participant
of a retirement system or pension fund subject to this Section
on or after January 1, 2011 is receiving a retirement annuity
or retirement pension under that system or fund and becomes a

SB3073 - 50 - LRB103 37686 RPS 67813 b
member or participant under any other system or fund created
by this Code and is employed on a full-time basis, except for
those members or participants exempted from the provisions of
this Section under subsection (a) of this Section, then the
person's retirement annuity or retirement pension under that
system or fund shall be suspended during that employment. Upon
termination of that employment, the person's retirement
annuity or retirement pension payments shall resume and be
recalculated if recalculation is provided for under the
applicable Article of this Code.
If a person who first becomes a member of a retirement
system or pension fund subject to this Section on or after
January 1, 2012 and is receiving a retirement annuity or
retirement pension under that system or fund and accepts on a
contractual basis a position to provide services to a
governmental entity from which he or she has retired, then
that person's annuity or retirement pension earned as an
active employee of the employer shall be suspended during that
contractual service. A person receiving an annuity or
retirement pension under this Code shall notify the pension
fund or retirement system from which he or she is receiving an
annuity or retirement pension, as well as his or her
contractual employer, of his or her retirement status before
accepting contractual employment. A person who fails to submit
such notification shall be guilty of a Class A misdemeanor and
required to pay a fine of $1,000. Upon termination of that

SB3073 - 51 - LRB103 37686 RPS 67813 b
contractual employment, the person's retirement annuity or
retirement pension payments shall resume and, if appropriate,
be recalculated under the applicable provisions of this Code.
(i) (Blank).
(j) In the case of a conflict between the provisions of
this Section and any other provision of this Code, the
provisions of this Section shall control.
(Source: P.A. 101-610, eff. 1-1-20; 102-16, eff. 6-17-21;
102-210, eff. 1-1-22; 102-263, eff. 8-6-21; 102-719, eff.
5-6-22.)
(Text of Section from P.A. 102-813)
Sec. 1-160. Provisions applicable to new hires.
(a) The provisions of this Section apply to a person who,
on or after January 1, 2011, first becomes a member or a
participant under any reciprocal retirement system or pension
fund established under this Code, other than a retirement
system or pension fund established under Article 2, 3, 4, 5, 6,
7, 15, or 18 of this Code, notwithstanding any other provision
of this Code to the contrary, but do not apply to any
self-managed plan established under this Code or to any
participant of the retirement plan established under Section
22-101; except that this Section applies to a person who
elected to establish alternative credits by electing in
writing after January 1, 2011, but before August 8, 2011,
under Section 7-145.1 of this Code. Notwithstanding anything

SB3073 - 52 - LRB103 37686 RPS 67813 b
to the contrary in this Section, for purposes of this Section,
a person who is a Tier 1 regular employee as defined in Section
7-109.4 of this Code or who participated in a retirement
system under Article 15 prior to January 1, 2011 shall be
deemed a person who first became a member or participant prior
to January 1, 2011 under any retirement system or pension fund
subject to this Section. The changes made to this Section by
Public Act 98-596 are a clarification of existing law and are
intended to be retroactive to January 1, 2011 (the effective
date of Public Act 96-889), notwithstanding the provisions of
Section 1-103.1 of this Code.
This Section does not apply to a person who first becomes a
noncovered employee under Article 14 on or after the
implementation date of the plan created under Section 1-161
for that Article, unless that person elects under subsection
(b) of Section 1-161 to instead receive the benefits provided
under this Section and the applicable provisions of that
Article.
This Section does not apply to a person who first becomes a
member or participant under Article 16 on or after the
implementation date of the plan created under Section 1-161
for that Article, unless that person elects under subsection
(b) of Section 1-161 to instead receive the benefits provided
under this Section and the applicable provisions of that
Article.
This Section does not apply to a person who elects under

SB3073 - 53 - LRB103 37686 RPS 67813 b
subsection (c-5) of Section 1-161 to receive the benefits
under Section 1-161.
This Section does not apply to a person who first becomes a
member or participant of an affected pension fund on or after 6
months after the resolution or ordinance date, as defined in
Section 1-162, unless that person elects under subsection (c)
of Section 1-162 to receive the benefits provided under this
Section and the applicable provisions of the Article under
which he or she is a member or participant.
This Section does not apply to a person who participates
in a defined contribution plan established under Section
14-155.5.
(b) "Final average salary" means, except as otherwise
provided in this subsection, the average monthly (or annual)
salary obtained by dividing the total salary or earnings
calculated under the Article applicable to the member or
participant during the 96 consecutive months (or 8 consecutive
years) of service within the last 120 months (or 10 years) of
service in which the total salary or earnings calculated under
the applicable Article was the highest by the number of months
(or years) of service in that period. For the purposes of a
person who first becomes a member or participant of any
retirement system or pension fund to which this Section
applies on or after January 1, 2011, in this Code, "final
average salary" shall be substituted for the following:
(1) (Blank).

SB3073 - 54 - LRB103 37686 RPS 67813 b
(2) In Articles 8, 9, 10, 11, and 12, "highest average
annual salary for any 4 consecutive years within the last
10 years of service immediately preceding the date of
withdrawal".
(3) In Article 13, "average final salary".
(4) In Article 14, "final average compensation".
(5) In Article 17, "average salary".
(6) In Section 22-207, "wages or salary received by
him at the date of retirement or discharge".
A member of the Teachers' Retirement System of the State
of Illinois who retires on or after June 1, 2021 and for whom
the 2020-2021 school year is used in the calculation of the
member's final average salary shall use the higher of the
following for the purpose of determining the member's final
average salary:
(A) the amount otherwise calculated under the first
paragraph of this subsection; or
(B) an amount calculated by the Teachers' Retirement
System of the State of Illinois using the average of the
monthly (or annual) salary obtained by dividing the total
salary or earnings calculated under Article 16 applicable
to the member or participant during the 96 months (or 8
years) of service within the last 120 months (or 10 years)
of service in which the total salary or earnings
calculated under the Article was the highest by the number
of months (or years) of service in that period.

SB3073 - 55 - LRB103 37686 RPS 67813 b
(b-5) Beginning on January 1, 2011, for all purposes under
this Code (including without limitation the calculation of
benefits and employee contributions), the annual earnings,
salary, or wages (based on the plan year) of a member or
participant to whom this Section applies shall not exceed
$106,800; however, that amount shall annually thereafter be
increased by the lesser of (i) 3% of that amount, including all
previous adjustments, or (ii) one-half the annual unadjusted
percentage increase (but not less than zero) in the consumer
price index-u for the 12 months ending with the September
preceding each November 1, including all previous adjustments.
For the purposes of this Section, "consumer price index-u"
means the index published by the Bureau of Labor Statistics of
the United States Department of Labor that measures the
average change in prices of goods and services purchased by
all urban consumers, United States city average, all items,
1982-84 = 100. The new amount resulting from each annual
adjustment shall be determined by the Public Pension Division
of the Department of Insurance and made available to the
boards of the retirement systems and pension funds by November
1 of each year.
(b-10) Beginning on January 1, 2024, for all purposes
under this Code (including, without limitation, the
calculation of benefits and employee contributions), the
annual earnings, salary, or wages (based on the plan year) of a
member or participant under Article 9 to whom this Section

SB3073 - 56 - LRB103 37686 RPS 67813 b
applies shall include an annual earnings, salary, or wage cap
that tracks the Social Security wage base. Maximum annual
earnings, wages, or salary shall be the annual contribution
and benefit base established for the applicable year by the
Commissioner of the Social Security Administration under the
federal Social Security Act.
However, in no event shall the annual earnings, salary, or
wages for the purposes of this Article and Article 9 exceed any
limitation imposed on annual earnings, salary, or wages under
Section 1-117. Under no circumstances shall the maximum amount
of annual earnings, salary, or wages be greater than the
amount set forth in this subsection (b-10) as a result of
reciprocal service or any provisions regarding reciprocal
services, nor shall the Fund under Article 9 be required to pay
any refund as a result of the application of this maximum
annual earnings, salary, and wage cap.
Nothing in this subsection (b-10) shall cause or otherwise
result in any retroactive adjustment of any employee
contributions. Nothing in this subsection (b-10) shall cause
or otherwise result in any retroactive adjustment of
disability or other payments made between January 1, 2011 and
January 1, 2024.
(c) A member or participant is entitled to a retirement
annuity upon written application if he or she has attained age
67 (age 65, with respect to service under Article 12 that is
subject to this Section, for a member or participant under

SB3073 - 57 - LRB103 37686 RPS 67813 b
Article 12 who first becomes a member or participant under
Article 12 on or after January 1, 2022 or who makes the
election under item (i) of subsection (d-15) of this Section)
and has at least 10 years of service credit and is otherwise
eligible under the requirements of the applicable Article.
A member or participant who has attained age 62 (age 60,
with respect to service under Article 12 that is subject to
this Section, for a member or participant under Article 12 who
first becomes a member or participant under Article 12 on or
after January 1, 2022 or who makes the election under item (i)
of subsection (d-15) of this Section) and has at least 10 years
of service credit and is otherwise eligible under the
requirements of the applicable Article may elect to receive
the lower retirement annuity provided in subsection (d) of
this Section.
(c-5) A person who first becomes a member or a participant
subject to this Section on or after July 6, 2017 (the effective
date of Public Act 100-23), notwithstanding any other
provision of this Code to the contrary, is entitled to a
retirement annuity under Article 8 or Article 11 upon written
application if he or she has attained age 65 and has at least
10 years of service credit and is otherwise eligible under the
requirements of Article 8 or Article 11 of this Code,
whichever is applicable.
(d) The retirement annuity of a member or participant who
is retiring after attaining age 62 (age 60, with respect to

SB3073 - 58 - LRB103 37686 RPS 67813 b
service under Article 12 that is subject to this Section, for a
member or participant under Article 12 who first becomes a
member or participant under Article 12 on or after January 1,
2022 or who makes the election under item (i) of subsection
(d-15) of this Section) with at least 10 years of service
credit shall be reduced by one-half of 1% for each full month
that the member's age is under age 67 (age 65, with respect to
service under Article 12 that is subject to this Section, for a
member or participant under Article 12 who first becomes a
member or participant under Article 12 on or after January 1,
2022 or who makes the election under item (i) of subsection
(d-15) of this Section).
(d-5) The retirement annuity payable under Article 8 or
Article 11 to an eligible person subject to subsection (c-5)
of this Section who is retiring at age 60 with at least 10
years of service credit shall be reduced by one-half of 1% for
each full month that the member's age is under age 65.
(d-10) Each person who first became a member or
participant under Article 8 or Article 11 of this Code on or
after January 1, 2011 and prior to July 6, 2017 (the effective
date of Public Act 100-23) shall make an irrevocable election
either:
(i) to be eligible for the reduced retirement age
provided in subsections (c-5) and (d-5) of this Section,
the eligibility for which is conditioned upon the member
or participant agreeing to the increases in employee

SB3073 - 59 - LRB103 37686 RPS 67813 b
contributions for age and service annuities provided in
subsection (a-5) of Section 8-174 of this Code (for
service under Article 8) or subsection (a-5) of Section
11-170 of this Code (for service under Article 11); or
(ii) to not agree to item (i) of this subsection
(d-10), in which case the member or participant shall
continue to be subject to the retirement age provisions in
subsections (c) and (d) of this Section and the employee
contributions for age and service annuity as provided in
subsection (a) of Section 8-174 of this Code (for service
under Article 8) or subsection (a) of Section 11-170 of
this Code (for service under Article 11).
The election provided for in this subsection shall be made
between October 1, 2017 and November 15, 2017. A person
subject to this subsection who makes the required election
shall remain bound by that election. A person subject to this
subsection who fails for any reason to make the required
election within the time specified in this subsection shall be
deemed to have made the election under item (ii).
(d-15) Each person who first becomes a member or
participant under Article 12 on or after January 1, 2011 and
prior to January 1, 2022 shall make an irrevocable election
either:
(i) to be eligible for the reduced retirement age
specified in subsections (c) and (d) of this Section, the
eligibility for which is conditioned upon the member or

SB3073 - 60 - LRB103 37686 RPS 67813 b
participant agreeing to the increase in employee
contributions for service annuities specified in
subsection (b) of Section 12-150; or
(ii) to not agree to item (i) of this subsection
(d-15), in which case the member or participant shall not
be eligible for the reduced retirement age specified in
subsections (c) and (d) of this Section and shall not be
subject to the increase in employee contributions for
service annuities specified in subsection (b) of Section
12-150.
The election provided for in this subsection shall be made
between January 1, 2022 and April 1, 2022. A person subject to
this subsection who makes the required election shall remain
bound by that election. A person subject to this subsection
who fails for any reason to make the required election within
the time specified in this subsection shall be deemed to have
made the election under item (ii).
(e) Any retirement annuity or supplemental annuity shall
be subject to annual increases on the January 1 occurring
either on or after the attainment of age 67 (age 65, with
respect to service under Article 12 that is subject to this
Section, for a member or participant under Article 12 who
first becomes a member or participant under Article 12 on or
after January 1, 2022 or who makes the election under item (i)
of subsection (d-15); and beginning on July 6, 2017 (the
effective date of Public Act 100-23), age 65 with respect to

SB3073 - 61 - LRB103 37686 RPS 67813 b
service under Article 8 or Article 11 for eligible persons
who: (i) are subject to subsection (c-5) of this Section; or
(ii) made the election under item (i) of subsection (d-10) of
this Section) or the first anniversary of the annuity start
date, whichever is later. Each annual increase shall be
calculated at 3% or one-half the annual unadjusted percentage
increase (but not less than zero) in the consumer price
index-u for the 12 months ending with the September preceding
each November 1, whichever is less, of the originally granted
retirement annuity. If the annual unadjusted percentage change
in the consumer price index-u for the 12 months ending with the
September preceding each November 1 is zero or there is a
decrease, then the annuity shall not be increased.
For the purposes of Section 1-103.1 of this Code, the
changes made to this Section by Public Act 102-263 are
applicable without regard to whether the employee was in
active service on or after August 6, 2021 (the effective date
of Public Act 102-263).
For the purposes of Section 1-103.1 of this Code, the
changes made to this Section by Public Act 100-23 are
applicable without regard to whether the employee was in
active service on or after July 6, 2017 (the effective date of
Public Act 100-23).
(f) The initial survivor's or widow's annuity of an
otherwise eligible survivor or widow of a retired member or
participant who first became a member or participant on or

SB3073 - 62 - LRB103 37686 RPS 67813 b
after January 1, 2011 shall be in the amount of 66 2/3% of the
retired member's or participant's retirement annuity at the
date of death. In the case of the death of a member or
participant who has not retired and who first became a member
or participant on or after January 1, 2011, eligibility for a
survivor's or widow's annuity shall be determined by the
applicable Article of this Code. The initial benefit shall be
66 2/3% of the earned annuity without a reduction due to age. A
child's annuity of an otherwise eligible child shall be in the
amount prescribed under each Article if applicable. Any
survivor's or widow's annuity shall be increased (1) on each
January 1 occurring on or after the commencement of the
annuity if the deceased member died while receiving a
retirement annuity or (2) in other cases, on each January 1
occurring after the first anniversary of the commencement of
the annuity. Each annual increase shall be calculated at 3% or
one-half the annual unadjusted percentage increase (but not
less than zero) in the consumer price index-u for the 12 months
ending with the September preceding each November 1, whichever
is less, of the originally granted survivor's annuity. If the
annual unadjusted percentage change in the consumer price
index-u for the 12 months ending with the September preceding
each November 1 is zero or there is a decrease, then the
annuity shall not be increased.
(g) The benefits in Section 14-110 apply only if the
person is a State policeman, a fire fighter in the fire

SB3073 - 63 - LRB103 37686 RPS 67813 b
protection service of a department, a conservation police
officer, an investigator for the Secretary of State, an arson
investigator, a Commerce Commission police officer,
investigator for the Department of Revenue or the Illinois
Gaming Board, a security employee of the Department of
Corrections or the Department of Juvenile Justice, or a
security employee of the Department of Innovation and
Technology, as those terms are defined in subsection (b) and
subsection (c) of Section 14-110. A person who meets the
requirements of this Section is entitled to an annuity
calculated under the provisions of Section 14-110, in lieu of
the regular or minimum retirement annuity, only if the person
has withdrawn from service with not less than 20 years of
eligible creditable service and has attained age 60,
regardless of whether the attainment of age 60 occurs while
the person is still in service.
(h) If a person who first becomes a member or a participant
of a retirement system or pension fund subject to this Section
on or after January 1, 2011 is receiving a retirement annuity
or retirement pension under that system or fund and becomes a
member or participant under any other system or fund created
by this Code and is employed on a full-time basis, except for
those members or participants exempted from the provisions of
this Section under subsection (a) of this Section, then the
person's retirement annuity or retirement pension under that
system or fund shall be suspended during that employment. Upon

SB3073 - 64 - LRB103 37686 RPS 67813 b
termination of that employment, the person's retirement
annuity or retirement pension payments shall resume and be
recalculated if recalculation is provided for under the
applicable Article of this Code.
If a person who first becomes a member of a retirement
system or pension fund subject to this Section on or after
January 1, 2012 and is receiving a retirement annuity or
retirement pension under that system or fund and accepts on a
contractual basis a position to provide services to a
governmental entity from which he or she has retired, then
that person's annuity or retirement pension earned as an
active employee of the employer shall be suspended during that
contractual service. A person receiving an annuity or
retirement pension under this Code shall notify the pension
fund or retirement system from which he or she is receiving an
annuity or retirement pension, as well as his or her
contractual employer, of his or her retirement status before
accepting contractual employment. A person who fails to submit
such notification shall be guilty of a Class A misdemeanor and
required to pay a fine of $1,000. Upon termination of that
contractual employment, the person's retirement annuity or
retirement pension payments shall resume and, if appropriate,
be recalculated under the applicable provisions of this Code.
(i) (Blank).
(j) In the case of a conflict between the provisions of
this Section and any other provision of this Code, the

SB3073 - 65 - LRB103 37686 RPS 67813 b
provisions of this Section shall control.
(Source: P.A. 101-610, eff. 1-1-20; 102-16, eff. 6-17-21;
102-210, eff. 1-1-22; 102-263, eff. 8-6-21; 102-813, eff.
5-13-22.)
(Text of Section from P.A. 102-956)
Sec. 1-160. Provisions applicable to new hires.
(a) The provisions of this Section apply to a person who,
on or after January 1, 2011, first becomes a member or a
participant under any reciprocal retirement system or pension
fund established under this Code, other than a retirement
system or pension fund established under Article 2, 3, 4, 5, 6,
7, 15, or 18 of this Code, notwithstanding any other provision
of this Code to the contrary, but do not apply to any
self-managed plan established under this Code or to any
participant of the retirement plan established under Section
22-101; except that this Section applies to a person who
elected to establish alternative credits by electing in
writing after January 1, 2011, but before August 8, 2011,
under Section 7-145.1 of this Code. Notwithstanding anything
to the contrary in this Section, for purposes of this Section,
a person who is a Tier 1 regular employee as defined in Section
7-109.4 of this Code or who participated in a retirement
system under Article 15 prior to January 1, 2011 shall be
deemed a person who first became a member or participant prior
to January 1, 2011 under any retirement system or pension fund

SB3073 - 66 - LRB103 37686 RPS 67813 b
subject to this Section. The changes made to this Section by
Public Act 98-596 are a clarification of existing law and are
intended to be retroactive to January 1, 2011 (the effective
date of Public Act 96-889), notwithstanding the provisions of
Section 1-103.1 of this Code.
This Section does not apply to a person who first becomes a
noncovered employee under Article 14 on or after the
implementation date of the plan created under Section 1-161
for that Article, unless that person elects under subsection
(b) of Section 1-161 to instead receive the benefits provided
under this Section and the applicable provisions of that
Article.
This Section does not apply to a person who first becomes a
member or participant under Article 16 on or after the
implementation date of the plan created under Section 1-161
for that Article, unless that person elects under subsection
(b) of Section 1-161 to instead receive the benefits provided
under this Section and the applicable provisions of that
Article.
This Section does not apply to a person who elects under
subsection (c-5) of Section 1-161 to receive the benefits
under Section 1-161.
This Section does not apply to a person who first becomes a
member or participant of an affected pension fund on or after 6
months after the resolution or ordinance date, as defined in
Section 1-162, unless that person elects under subsection (c)

SB3073 - 67 - LRB103 37686 RPS 67813 b
of Section 1-162 to receive the benefits provided under this
Section and the applicable provisions of the Article under
which he or she is a member or participant.
This Section does not apply to a person who participates
in a defined contribution plan established under Section
14-155.5.
(b) "Final average salary" means, except as otherwise
provided in this subsection, the average monthly (or annual)
salary obtained by dividing the total salary or earnings
calculated under the Article applicable to the member or
participant during the 96 consecutive months (or 8 consecutive
years) of service within the last 120 months (or 10 years) of
service in which the total salary or earnings calculated under
the applicable Article was the highest by the number of months
(or years) of service in that period. For the purposes of a
person who first becomes a member or participant of any
retirement system or pension fund to which this Section
applies on or after January 1, 2011, in this Code, "final
average salary" shall be substituted for the following:
(1) (Blank).
(2) In Articles 8, 9, 10, 11, and 12, "highest average
annual salary for any 4 consecutive years within the last
10 years of service immediately preceding the date of
withdrawal".
(3) In Article 13, "average final salary".
(4) In Article 14, "final average compensation".

SB3073 - 68 - LRB103 37686 RPS 67813 b
(5) In Article 17, "average salary".
(6) In Section 22-207, "wages or salary received by
him at the date of retirement or discharge".
A member of the Teachers' Retirement System of the State
of Illinois who retires on or after June 1, 2021 and for whom
the 2020-2021 school year is used in the calculation of the
member's final average salary shall use the higher of the
following for the purpose of determining the member's final
average salary:
(A) the amount otherwise calculated under the first
paragraph of this subsection; or
(B) an amount calculated by the Teachers' Retirement
System of the State of Illinois using the average of the
monthly (or annual) salary obtained by dividing the total
salary or earnings calculated under Article 16 applicable
to the member or participant during the 96 months (or 8
years) of service within the last 120 months (or 10 years)
of service in which the total salary or earnings
calculated under the Article was the highest by the number
of months (or years) of service in that period.
(b-5) Beginning on January 1, 2011, for all purposes under
this Code (including without limitation the calculation of
benefits and employee contributions), the annual earnings,
salary, or wages (based on the plan year) of a member or
participant to whom this Section applies shall not exceed
$106,800; however, that amount shall annually thereafter be

SB3073 - 69 - LRB103 37686 RPS 67813 b
increased by the lesser of (i) 3% of that amount, including all
previous adjustments, or (ii) one-half the annual unadjusted
percentage increase (but not less than zero) in the consumer
price index-u for the 12 months ending with the September
preceding each November 1, including all previous adjustments.
For the purposes of this Section, "consumer price index-u"
means the index published by the Bureau of Labor Statistics of
the United States Department of Labor that measures the
average change in prices of goods and services purchased by
all urban consumers, United States city average, all items,
1982-84 = 100. The new amount resulting from each annual
adjustment shall be determined by the Public Pension Division
of the Department of Insurance and made available to the
boards of the retirement systems and pension funds by November
1 of each year.
(b-10) Beginning on January 1, 2024, for all purposes
under this Code (including, without limitation, the
calculation of benefits and employee contributions), the
annual earnings, salary, or wages (based on the plan year) of a
member or participant under Article 9 to whom this Section
applies shall include an annual earnings, salary, or wage cap
that tracks the Social Security wage base. Maximum annual
earnings, wages, or salary shall be the annual contribution
and benefit base established for the applicable year by the
Commissioner of the Social Security Administration under the
federal Social Security Act.

SB3073 - 70 - LRB103 37686 RPS 67813 b
However, in no event shall the annual earnings, salary, or
wages for the purposes of this Article and Article 9 exceed any
limitation imposed on annual earnings, salary, or wages under
Section 1-117. Under no circumstances shall the maximum amount
of annual earnings, salary, or wages be greater than the
amount set forth in this subsection (b-10) as a result of
reciprocal service or any provisions regarding reciprocal
services, nor shall the Fund under Article 9 be required to pay
any refund as a result of the application of this maximum
annual earnings, salary, and wage cap.
Nothing in this subsection (b-10) shall cause or otherwise
result in any retroactive adjustment of any employee
contributions. Nothing in this subsection (b-10) shall cause
or otherwise result in any retroactive adjustment of
disability or other payments made between January 1, 2011 and
January 1, 2024.
(c) A member or participant is entitled to a retirement
annuity upon written application if he or she has attained age
67 (age 65, with respect to service under Article 12 that is
subject to this Section, for a member or participant under
Article 12 who first becomes a member or participant under
Article 12 on or after January 1, 2022 or who makes the
election under item (i) of subsection (d-15) of this Section)
and has at least 10 years of service credit and is otherwise
eligible under the requirements of the applicable Article.
A member or participant who has attained age 62 (age 60,

SB3073 - 71 - LRB103 37686 RPS 67813 b
with respect to service under Article 12 that is subject to
this Section, for a member or participant under Article 12 who
first becomes a member or participant under Article 12 on or
after January 1, 2022 or who makes the election under item (i)
of subsection (d-15) of this Section) and has at least 10 years
of service credit and is otherwise eligible under the
requirements of the applicable Article may elect to receive
the lower retirement annuity provided in subsection (d) of
this Section.
(c-5) A person who first becomes a member or a participant
subject to this Section on or after July 6, 2017 (the effective
date of Public Act 100-23), notwithstanding any other
provision of this Code to the contrary, is entitled to a
retirement annuity under Article 8 or Article 11 upon written
application if he or she has attained age 65 and has at least
10 years of service credit and is otherwise eligible under the
requirements of Article 8 or Article 11 of this Code,
whichever is applicable.
(d) The retirement annuity of a member or participant who
is retiring after attaining age 62 (age 60, with respect to
service under Article 12 that is subject to this Section, for a
member or participant under Article 12 who first becomes a
member or participant under Article 12 on or after January 1,
2022 or who makes the election under item (i) of subsection
(d-15) of this Section) with at least 10 years of service
credit shall be reduced by one-half of 1% for each full month

SB3073 - 72 - LRB103 37686 RPS 67813 b
that the member's age is under age 67 (age 65, with respect to
service under Article 12 that is subject to this Section, for a
member or participant under Article 12 who first becomes a
member or participant under Article 12 on or after January 1,
2022 or who makes the election under item (i) of subsection
(d-15) of this Section).
(d-5) The retirement annuity payable under Article 8 or
Article 11 to an eligible person subject to subsection (c-5)
of this Section who is retiring at age 60 with at least 10
years of service credit shall be reduced by one-half of 1% for
each full month that the member's age is under age 65.
(d-10) Each person who first became a member or
participant under Article 8 or Article 11 of this Code on or
after January 1, 2011 and prior to July 6, 2017 (the effective
date of Public Act 100-23) shall make an irrevocable election
either:
(i) to be eligible for the reduced retirement age
provided in subsections (c-5) and (d-5) of this Section,
the eligibility for which is conditioned upon the member
or participant agreeing to the increases in employee
contributions for age and service annuities provided in
subsection (a-5) of Section 8-174 of this Code (for
service under Article 8) or subsection (a-5) of Section
11-170 of this Code (for service under Article 11); or
(ii) to not agree to item (i) of this subsection
(d-10), in which case the member or participant shall

SB3073 - 73 - LRB103 37686 RPS 67813 b
continue to be subject to the retirement age provisions in
subsections (c) and (d) of this Section and the employee
contributions for age and service annuity as provided in
subsection (a) of Section 8-174 of this Code (for service
under Article 8) or subsection (a) of Section 11-170 of
this Code (for service under Article 11).
The election provided for in this subsection shall be made
between October 1, 2017 and November 15, 2017. A person
subject to this subsection who makes the required election
shall remain bound by that election. A person subject to this
subsection who fails for any reason to make the required
election within the time specified in this subsection shall be
deemed to have made the election under item (ii).
(d-15) Each person who first becomes a member or
participant under Article 12 on or after January 1, 2011 and
prior to January 1, 2022 shall make an irrevocable election
either:
(i) to be eligible for the reduced retirement age
specified in subsections (c) and (d) of this Section, the
eligibility for which is conditioned upon the member or
participant agreeing to the increase in employee
contributions for service annuities specified in
subsection (b) of Section 12-150; or
(ii) to not agree to item (i) of this subsection
(d-15), in which case the member or participant shall not
be eligible for the reduced retirement age specified in

SB3073 - 74 - LRB103 37686 RPS 67813 b
subsections (c) and (d) of this Section and shall not be
subject to the increase in employee contributions for
service annuities specified in subsection (b) of Section
12-150.
The election provided for in this subsection shall be made
between January 1, 2022 and April 1, 2022. A person subject to
this subsection who makes the required election shall remain
bound by that election. A person subject to this subsection
who fails for any reason to make the required election within
the time specified in this subsection shall be deemed to have
made the election under item (ii).
(e) Any retirement annuity or supplemental annuity shall
be subject to annual increases on the January 1 occurring
either on or after the attainment of age 67 (age 65, with
respect to service under Article 12 that is subject to this
Section, for a member or participant under Article 12 who
first becomes a member or participant under Article 12 on or
after January 1, 2022 or who makes the election under item (i)
of subsection (d-15); and beginning on July 6, 2017 (the
effective date of Public Act 100-23), age 65 with respect to
service under Article 8 or Article 11 for eligible persons
who: (i) are subject to subsection (c-5) of this Section; or
(ii) made the election under item (i) of subsection (d-10) of
this Section) or the first anniversary of the annuity start
date, whichever is later. Each annual increase shall be
calculated at 3% or one-half the annual unadjusted percentage

SB3073 - 75 - LRB103 37686 RPS 67813 b
increase (but not less than zero) in the consumer price
index-u for the 12 months ending with the September preceding
each November 1, whichever is less, of the originally granted
retirement annuity. If the annual unadjusted percentage change
in the consumer price index-u for the 12 months ending with the
September preceding each November 1 is zero or there is a
decrease, then the annuity shall not be increased.
For the purposes of Section 1-103.1 of this Code, the
changes made to this Section by Public Act 102-263 are
applicable without regard to whether the employee was in
active service on or after August 6, 2021 (the effective date
of Public Act 102-263).
For the purposes of Section 1-103.1 of this Code, the
changes made to this Section by Public Act 100-23 are
applicable without regard to whether the employee was in
active service on or after July 6, 2017 (the effective date of
Public Act 100-23).
(f) The initial survivor's or widow's annuity of an
otherwise eligible survivor or widow of a retired member or
participant who first became a member or participant on or
after January 1, 2011 shall be in the amount of 66 2/3% of the
retired member's or participant's retirement annuity at the
date of death. In the case of the death of a member or
participant who has not retired and who first became a member
or participant on or after January 1, 2011, eligibility for a
survivor's or widow's annuity shall be determined by the

SB3073 - 76 - LRB103 37686 RPS 67813 b
applicable Article of this Code. The initial benefit shall be
66 2/3% of the earned annuity without a reduction due to age. A
child's annuity of an otherwise eligible child shall be in the
amount prescribed under each Article if applicable. Any
survivor's or widow's annuity shall be increased (1) on each
January 1 occurring on or after the commencement of the
annuity if the deceased member died while receiving a
retirement annuity or (2) in other cases, on each January 1
occurring after the first anniversary of the commencement of
the annuity. Each annual increase shall be calculated at 3% or
one-half the annual unadjusted percentage increase (but not
less than zero) in the consumer price index-u for the 12 months
ending with the September preceding each November 1, whichever
is less, of the originally granted survivor's annuity. If the
annual unadjusted percentage change in the consumer price
index-u for the 12 months ending with the September preceding
each November 1 is zero or there is a decrease, then the
annuity shall not be increased.
(g) The benefits in Section 14-110 apply only if the
person is a State policeman, a fire fighter in the fire
protection service of a department, a conservation police
officer, an investigator for the Secretary of State, an
investigator for the Office of the Attorney General, an arson
investigator, a Commerce Commission police officer,
investigator for the Department of Revenue or the Illinois
Gaming Board, a security employee of the Department of

SB3073 - 77 - LRB103 37686 RPS 67813 b
Corrections or the Department of Juvenile Justice, or a
security employee of the Department of Innovation and
Technology, as those terms are defined in subsection (b) and
subsection (c) of Section 14-110. A person who meets the
requirements of this Section is entitled to an annuity
calculated under the provisions of Section 14-110, in lieu of
the regular or minimum retirement annuity, only if the person
has withdrawn from service with not less than 20 years of
eligible creditable service and has attained age 60,
regardless of whether the attainment of age 60 occurs while
the person is still in service.
(h) If a person who first becomes a member or a participant
of a retirement system or pension fund subject to this Section
on or after January 1, 2011 is receiving a retirement annuity
or retirement pension under that system or fund and becomes a
member or participant under any other system or fund created
by this Code and is employed on a full-time basis, except for
those members or participants exempted from the provisions of
this Section under subsection (a) of this Section, then the
person's retirement annuity or retirement pension under that
system or fund shall be suspended during that employment. Upon
termination of that employment, the person's retirement
annuity or retirement pension payments shall resume and be
recalculated if recalculation is provided for under the
applicable Article of this Code.
If a person who first becomes a member of a retirement

SB3073 - 78 - LRB103 37686 RPS 67813 b
system or pension fund subject to this Section on or after
January 1, 2012 and is receiving a retirement annuity or
retirement pension under that system or fund and accepts on a
contractual basis a position to provide services to a
governmental entity from which he or she has retired, then
that person's annuity or retirement pension earned as an
active employee of the employer shall be suspended during that
contractual service. A person receiving an annuity or
retirement pension under this Code shall notify the pension
fund or retirement system from which he or she is receiving an
annuity or retirement pension, as well as his or her
contractual employer, of his or her retirement status before
accepting contractual employment. A person who fails to submit
such notification shall be guilty of a Class A misdemeanor and
required to pay a fine of $1,000. Upon termination of that
contractual employment, the person's retirement annuity or
retirement pension payments shall resume and, if appropriate,
be recalculated under the applicable provisions of this Code.
(i) (Blank).
(j) In the case of a conflict between the provisions of
this Section and any other provision of this Code, the
provisions of this Section shall control.
(Source: P.A. 102-16, eff. 6-17-21; 102-210, eff. 1-1-22;
102-263, eff. 8-6-21; 102-956, eff. 5-27-22; 103-529, eff.
8-11-23.)

SB3073 - 79 - LRB103 37686 RPS 67813 b
(40 ILCS 5/1-161)
Sec. 1-161. Optional benefits for certain Tier 2 members
under Articles 14, 15, and 16.
(a) Notwithstanding any other provision of this Code to
the contrary, the provisions of this Section apply to a person
who first becomes a member or a participant under Article 14,
15, or 16 on or after the implementation date under this
Section for the applicable Article and who does not make the
election under subsection (b) or (c), whichever applies. The
provisions of this Section also apply to a person who makes the
election under subsection (c-5). However, the provisions of
this Section do not apply to any participant in a self-managed
plan or a defined contribution plan established under Section
14-155.5, nor to a covered employee under Article 14.
As used in this Section and Section 1-160, the
"implementation date" under this Section means the earliest
date upon which the board of a retirement system authorizes
members of that system to begin participating in accordance
with this Section, as determined by the board of that
retirement system. Each of the retirement systems subject to
this Section shall endeavor to make such participation
available as soon as possible after the effective date of this
Section and shall establish an implementation date by board
resolution.
(b) In lieu of the benefits provided under this Section, a
member or participant, except for a participant under Article

SB3073 - 80 - LRB103 37686 RPS 67813 b
15, may irrevocably elect the benefits under Section 1-160 and
the benefits otherwise applicable to that member or
participant. The election must be made within 30 days after
becoming a member or participant. Each retirement system shall
establish procedures for making this election.
(c) A participant under Article 15 may irrevocably elect
the benefits otherwise provided to a Tier 2 member under
Article 15. The election must be made within 30 days after
becoming a member. The retirement system under Article 15
shall establish procedures for making this election.
(c-5) A non-covered participant under Article 14 to whom
Section 1-160 applies, a Tier 2 member under Article 15, or a
participant under Article 16 to whom Section 1-160 applies may
irrevocably elect to receive the benefits under this Section
in lieu of the benefits under Section 1-160 or the benefits
otherwise available to a Tier 2 member under Article 15,
whichever is applicable. Each retirement System shall
establish procedures for making this election.
(d) "Final average salary" means the average monthly (or
annual) salary obtained by dividing the total salary or
earnings calculated under the Article applicable to the member
or participant during the last 120 months (or 10 years) of
service in which the total salary or earnings calculated under
the applicable Article was the highest by the number of months
(or years) of service in that period. For the purposes of a
person to whom this Section applies, in this Code, "final

SB3073 - 81 - LRB103 37686 RPS 67813 b
average salary" shall be substituted for "final average
compensation" in Article 14.
(e) Beginning on the implementation date, for all purposes
under this Code (including without limitation the calculation
of benefits and employee contributions), the annual earnings,
salary, compensation, or wages (based on the plan year) of a
member or participant to whom this Section applies shall not
at any time exceed the federal Social Security Wage Base then
in effect.
(f) A member or participant is entitled to a retirement
annuity upon written application if he or she has attained the
normal retirement age determined by the Social Security
Administration for that member or participant's year of birth,
but no earlier than 67 years of age, and has at least 10 years
of service credit and is otherwise eligible under the
requirements of the applicable Article.
(g) The amount of the retirement annuity to which a member
or participant is entitled shall be computed by multiplying
1.25% for each year of service credit by his or her final
average salary.
(h) Any retirement annuity or supplemental annuity shall
be subject to annual increases on the first anniversary of the
annuity start date. Each annual increase shall be one-half the
annual unadjusted percentage increase (but not less than zero)
in the consumer price index-w for the 12 months ending with the
September preceding each November 1 of the originally granted

SB3073 - 82 - LRB103 37686 RPS 67813 b
retirement annuity. If the annual unadjusted percentage change
in the consumer price index-w for the 12 months ending with the
September preceding each November 1 is zero or there is a
decrease, then the annuity shall not be increased.
For the purposes of this Section, "consumer price index-w"
means the index published by the Bureau of Labor Statistics of
the United States Department of Labor that measures the
average change in prices of goods and services purchased by
Urban Wage Earners and Clerical Workers, United States city
average, all items, 1982-84 = 100. The new amount resulting
from each annual adjustment shall be determined by the Public
Pension Division of the Department of Insurance and made
available to the boards of the retirement systems and pension
funds by November 1 of each year.
(i) The initial survivor's or widow's annuity of an
otherwise eligible survivor or widow of a retired member or
participant to whom this Section applies shall be in the
amount of 66 2/3% of the retired member's or participant's
retirement annuity at the date of death. In the case of the
death of a member or participant who has not retired and to
whom this Section applies, eligibility for a survivor's or
widow's annuity shall be determined by the applicable Article
of this Code. The benefit shall be 66 2/3% of the earned
annuity without a reduction due to age. A child's annuity of an
otherwise eligible child shall be in the amount prescribed
under each Article if applicable.

SB3073 - 83 - LRB103 37686 RPS 67813 b
(j) In lieu of any other employee contributions, except
for the contribution to the defined contribution plan under
subsection (k) of this Section, each employee shall contribute
6.2% of his her or salary to the retirement system. However,
the employee contribution under this subsection shall not
exceed the amount of the total normal cost of the benefits for
all members making contributions under this Section (except
for the defined contribution plan under subsection (k) of this
Section), expressed as a percentage of payroll and certified
on or before January 15 of each year by the board of trustees
of the retirement system. If the board of trustees of the
retirement system certifies that the 6.2% employee
contribution rate exceeds the normal cost of the benefits
under this Section (except for the defined contribution plan
under subsection (k) of this Section), then on or before
December 1 of that year, the board of trustees shall certify
the amount of the normal cost of the benefits under this
Section (except for the defined contribution plan under
subsection (k) of this Section), expressed as a percentage of
payroll, to the State Actuary and the Commission on Government
Forecasting and Accountability, and the employee contribution
under this subsection shall be reduced to that amount
beginning July 1 of that year. Thereafter, if the normal cost
of the benefits under this Section (except for the defined
contribution plan under subsection (k) of this Section),
expressed as a percentage of payroll and certified on or

SB3073 - 84 - LRB103 37686 RPS 67813 b
before January 1 of each year by the board of trustees of the
retirement system, exceeds 6.2% of salary, then on or before
January 15 of that year, the board of trustees shall certify
the normal cost to the State Actuary and the Commission on
Government Forecasting and Accountability, and the employee
contributions shall revert back to 6.2% of salary beginning
January 1 of the following year.
(k) In accordance with each retirement system's
implementation date, each retirement system under Article 14,
15, or 16 shall prepare and implement a defined contribution
plan for members or participants who are subject to this
Section. The defined contribution plan developed under this
subsection shall be a plan that aggregates employer and
employee contributions in individual participant accounts
which, after meeting any other requirements, are used for
payouts after retirement in accordance with this subsection
and any other applicable laws.
(1) Each member or participant shall contribute a
minimum of 4% of his or her salary to the defined
contribution plan.
(2) For each participant in the defined contribution
plan who has been employed with the same employer for at
least one year, employer contributions shall be paid into
that participant's accounts at a rate expressed as a
percentage of salary. This rate may be set for individual
employees, but shall be no higher than 6% of salary and

SB3073 - 85 - LRB103 37686 RPS 67813 b
shall be no lower than 2% of salary.
(3) Employer contributions shall vest when those
contributions are paid into a member's or participant's
account.
(4) The defined contribution plan shall provide a
variety of options for investments. These options shall
include investments handled by the Illinois State Board of
Investment as well as private sector investment options.
(5) The defined contribution plan shall provide a
variety of options for payouts to retirees and their
survivors.
(6) To the extent authorized under federal law and as
authorized by the retirement system, the defined
contribution plan shall allow former participants in the
plan to transfer or roll over employee and employer
contributions, and the earnings thereon, into other
qualified retirement plans.
(7) Each retirement system shall reduce the employee
contributions credited to the member's defined
contribution plan account by an amount determined by that
retirement system to cover the cost of offering the
benefits under this subsection and any applicable
administrative fees.
(8) No person shall begin participating in the defined
contribution plan until it has attained qualified plan
status and received all necessary approvals from the U.S.

SB3073 - 86 - LRB103 37686 RPS 67813 b
Internal Revenue Service.
(l) In the case of a conflict between the provisions of
this Section and any other provision of this Code, the
provisions of this Section shall control.
(Source: P.A. 100-23, eff. 7-6-17.)
(40 ILCS 5/14-103.05) (from Ch. 108 1/2, par. 14-103.05)
Sec. 14-103.05. Employee.
(a) Except as provided in subsection (e), any Any person
employed by a Department who receives salary for personal
services rendered to the Department on a warrant issued
pursuant to a payroll voucher certified by a Department and
drawn by the State Comptroller upon the State Treasurer,
including an elected official described in subparagraph (d) of
Section 14-104, shall become an employee for purpose of
membership in the Retirement System on the first day of such
employment.
A person entering service on or after January 1, 1972 and
prior to January 1, 1984 shall become a member as a condition
of employment and shall begin making contributions as of the
first day of employment.
A person entering service on or after January 1, 1984
shall, upon completion of 6 months of continuous service which
is not interrupted by a break of more than 2 months, become a
member as a condition of employment. Contributions shall begin
the first of the month after completion of the qualifying

SB3073 - 87 - LRB103 37686 RPS 67813 b
period.
A person employed by the Chicago Metropolitan Agency for
Planning on the effective date of this amendatory Act of the
95th General Assembly who was a member of this System as an
employee of the Chicago Area Transportation Study and makes an
election under Section 14-104.13 to participate in this System
for his or her employment with the Chicago Metropolitan Agency
for Planning.
The qualifying period of 6 months of service is not
applicable to: (1) a person who has been granted credit for
service in a position covered by the State Universities
Retirement System, the Teachers' Retirement System of the
State of Illinois, the General Assembly Retirement System, or
the Judges Retirement System of Illinois unless that service
has been forfeited under the laws of those systems; (2) a
person entering service on or after July 1, 1991 in a
noncovered position; (3) a person to whom Section 14-108.2a or
14-108.2b applies; or (4) a person to whom subsection (a-5) of
this Section applies.
(a-5) Except as provided in subsection (e), a A person
entering service on or after December 1, 2010 and before the
effective date of this amendatory Act of the 103rd General
Assembly shall become a member as a condition of employment
and shall begin making contributions as of the first day of
employment. A person serving in the qualifying period on
December 1, 2010 will become a member on December 1, 2010 and

SB3073 - 88 - LRB103 37686 RPS 67813 b
shall begin making contributions as of December 1, 2010.
(b) The term "employee" does not include the following:
(1) members of the State Legislature, and persons
electing to become members of the General Assembly
Retirement System pursuant to Section 2-105;
(2) incumbents of offices normally filled by vote of
the people;
(3) except as otherwise provided in this Section, any
person appointed by the Governor with the advice and
consent of the Senate unless that person elects to
participate in this system;
(3.1) any person serving as a commissioner of an
ethics commission created under the State Officials and
Employees Ethics Act unless that person elects to
participate in this system with respect to that service as
a commissioner;
(3.2) any person serving as a part-time employee in
any of the following positions: Legislative Inspector
General, Special Legislative Inspector General, employee
of the Office of the Legislative Inspector General,
Executive Director of the Legislative Ethics Commission,
or staff of the Legislative Ethics Commission, regardless
of whether he or she is in active service on or after July
8, 2004 (the effective date of Public Act 93-685), unless
that person elects to participate in this System with
respect to that service; in this item (3.2), a "part-time

SB3073 - 89 - LRB103 37686 RPS 67813 b
employee" is a person who is not required to work at least
35 hours per week;
(3.3) any person who has made an election under
Section 1-123 and who is serving either as legal counsel
in the Office of the Governor or as Chief Deputy Attorney
General;
(4) except as provided in Section 14-108.2 or
14-108.2c, any person who is covered or eligible to be
covered by the Teachers' Retirement System of the State of
Illinois, the State Universities Retirement System, or the
Judges Retirement System of Illinois;
(5) an employee of a municipality or any other
political subdivision of the State;
(6) any person who becomes an employee after June 30,
1979 as a public service employment program participant
under the Federal Comprehensive Employment and Training
Act and whose wages or fringe benefits are paid in whole or
in part by funds provided under such Act;
(7) enrollees of the Illinois Young Adult Conservation
Corps program, administered by the Department of Natural
Resources, authorized grantee pursuant to Title VIII of
the "Comprehensive Employment and Training Act of 1973",
29 USC 993, as now or hereafter amended;
(8) enrollees and temporary staff of programs
administered by the Department of Natural Resources under
the Youth Conservation Corps Act of 1970;

SB3073 - 90 - LRB103 37686 RPS 67813 b
(9) any person who is a member of any professional
licensing or disciplinary board created under an Act
administered by the Department of Professional Regulation
or a successor agency or created or re-created after the
effective date of this amendatory Act of 1997, and who
receives per diem compensation rather than a salary,
notwithstanding that such per diem compensation is paid by
warrant issued pursuant to a payroll voucher; such persons
have never been included in the membership of this System,
and this amendatory Act of 1987 (P.A. 84-1472) is not
intended to effect any change in the status of such
persons;
(10) any person who is a member of the Illinois Health
Care Cost Containment Council, and receives per diem
compensation rather than a salary, notwithstanding that
such per diem compensation is paid by warrant issued
pursuant to a payroll voucher; such persons have never
been included in the membership of this System, and this
amendatory Act of 1987 is not intended to effect any
change in the status of such persons;
(11) any person who is a member of the Oil and Gas
Board created by Section 1.2 of the Illinois Oil and Gas
Act, and receives per diem compensation rather than a
salary, notwithstanding that such per diem compensation is
paid by warrant issued pursuant to a payroll voucher;
(12) a person employed by the State Board of Higher

SB3073 - 91 - LRB103 37686 RPS 67813 b
Education in a position with the Illinois Century Network
as of June 30, 2004, who remains continuously employed
after that date by the Department of Central Management
Services in a position with the Illinois Century Network
and participates in the Article 15 system with respect to
that employment;
(13) any person who first becomes a member of the
Civil Service Commission on or after January 1, 2012;
(14) any person, other than the Director of Employment
Security, who first becomes a member of the Board of
Review of the Department of Employment Security on or
after January 1, 2012;
(15) any person who first becomes a member of the
Civil Service Commission on or after January 1, 2012;
(16) any person who first becomes a member of the
Illinois Liquor Control Commission on or after January 1,
2012;
(17) any person who first becomes a member of the
Secretary of State Merit Commission on or after January 1,
2012;
(18) any person who first becomes a member of the
Human Rights Commission on or after January 1, 2012 unless
he or she is eligible to participate in accordance with
subsection (d) of this Section;
(19) any person who first becomes a member of the
State Mining Board on or after January 1, 2012;

SB3073 - 92 - LRB103 37686 RPS 67813 b
(20) any person who first becomes a member of the
Property Tax Appeal Board on or after January 1, 2012;
(21) any person who first becomes a member of the
Illinois Racing Board on or after January 1, 2012;
(22) any person who first becomes a member of the
Illinois State Police Merit Board on or after January 1,
2012;
(23) any person who first becomes a member of the
Illinois State Toll Highway Authority on or after January
1, 2012; or
(24) any person who first becomes a member of the
Illinois State Board of Elections on or after January 1,
2012.
(c) An individual who represents or is employed as an
officer or employee of a statewide labor organization that
represents members of this System may participate in the
System and shall be deemed an employee, provided that (1) the
individual has previously earned creditable service under this
Article, (2) the individual files with the System an
irrevocable election to become a participant within 6 months
after the effective date of this amendatory Act of the 94th
General Assembly, and (3) the individual does not receive
credit for that employment under any other provisions of this
Code. An employee under this subsection (c) is responsible for
paying to the System both (i) employee contributions based on
the actual compensation received for service with the labor

SB3073 - 93 - LRB103 37686 RPS 67813 b
organization and (ii) employer contributions based on the
percentage of payroll certified by the board; all or any part
of these contributions may be paid on the employee's behalf or
picked up for tax purposes (if authorized under federal law)
by the labor organization.
A person who is an employee as defined in this subsection
(c) may establish service credit for similar employment prior
to becoming an employee under this subsection by paying to the
System for that employment the contributions specified in this
subsection, plus interest at the effective rate from the date
of service to the date of payment. However, credit shall not be
granted under this subsection (c) for any such prior
employment for which the applicant received credit under any
other provision of this Code or during which the applicant was
on a leave of absence.
(d) A person appointed as a member of the Human Rights
Commission on or after June 1, 2019 may elect to participate in
the System and shall be deemed an employee. Service and
contributions shall begin on the first payroll period
immediately following the employee's election to participate
in the System.
A person who is an employee as described in this
subsection (d) may establish service credit for employment as
a Human Rights Commissioner that occurred on or after June 1,
2019 and before establishing service under this subsection by
paying to the System for that employment the contributions

SB3073 - 94 - LRB103 37686 RPS 67813 b
specified in paragraph (1) of subsection (a) of Section
14-133, plus regular interest from the date of service to the
date of payment.
(e) Notwithstanding any other provision of this Article, a
person who first becomes an employee after the effective date
of this amendatory Act of the 103rd General Assembly is not
required, as a condition of employment or otherwise, to
participate in this System. An employee may elect not to
participate in this System by notifying the System in a manner
specified by the System.
(Source: P.A. 101-10, eff. 6-5-19; 102-538, eff. 8-20-21.)
(40 ILCS 5/14-103.41)
Sec. 14-103.41. Tier 1 member; Tier 2 member; defined
contribution plan member. "Tier 1 member": A member of this
System who first became a member or participant before January
1, 2011 under any reciprocal retirement system or pension fund
established under this Code other than a retirement system or
pension fund established under Article 2, 3, 4, 5, 6, or 18 of
this Code.
In the case of a Tier 1 member who elects to participate in
the defined contribution plan under Section 14-155.5 of this
Code, that Tier 1 member shall be deemed a Tier 1 member only
with respect to service performed or established before the
effective date of that election.
"Tier 2 member": A member of this System who first becomes

SB3073 - 95 - LRB103 37686 RPS 67813 b
a member under this Article on or after January 1, 2011 and who
is not a Tier 1 member.
In the case of a Tier 2 member who elects to participate in
the defined contribution plan under Section 14-155.5 of this
Code, that Tier 2 member shall be deemed a Tier 2 member only
with respect to service performed or established before the
effective date of that election.
"Defined contribution plan member": A Tier 1 or Tier 2
member who elects to participate in the defined contribution
plan under Section 14-155.5 of this Code, but only with
respect to service performed on or after the effective date of
that election.
(Source: P.A. 100-587, eff. 6-4-18.)
(40 ILCS 5/14-152.1)
Sec. 14-152.1. Application and expiration of new benefit
increases.
(a) As used in this Section, "new benefit increase" means
an increase in the amount of any benefit provided under this
Article, or an expansion of the conditions of eligibility for
any benefit under this Article, that results from an amendment
to this Code that takes effect after June 1, 2005 (the
effective date of Public Act 94-4). "New benefit increase",
however, does not include any benefit increase resulting from
the changes made to Article 1 or this Article by Public Act
96-37, Public Act 100-23, Public Act 100-587, Public Act

SB3073 - 96 - LRB103 37686 RPS 67813 b
100-611, Public Act 101-10, Public Act 101-610, Public Act
102-210, Public Act 102-856, Public Act 102-956, or this
amendatory Act of the 103rd General Assembly or this
amendatory Act of the 102nd General Assembly.
(b) Notwithstanding any other provision of this Code or
any subsequent amendment to this Code, every new benefit
increase is subject to this Section and shall be deemed to be
granted only in conformance with and contingent upon
compliance with the provisions of this Section.
(c) The Public Act enacting a new benefit increase must
identify and provide for payment to the System of additional
funding at least sufficient to fund the resulting annual
increase in cost to the System as it accrues.
Every new benefit increase is contingent upon the General
Assembly providing the additional funding required under this
subsection. The Commission on Government Forecasting and
Accountability shall analyze whether adequate additional
funding has been provided for the new benefit increase and
shall report its analysis to the Public Pension Division of
the Department of Insurance. A new benefit increase created by
a Public Act that does not include the additional funding
required under this subsection is null and void. If the Public
Pension Division determines that the additional funding
provided for a new benefit increase under this subsection is
or has become inadequate, it may so certify to the Governor and
the State Comptroller and, in the absence of corrective action

SB3073 - 97 - LRB103 37686 RPS 67813 b
by the General Assembly, the new benefit increase shall expire
at the end of the fiscal year in which the certification is
made.
(d) Every new benefit increase shall expire 5 years after
its effective date or on such earlier date as may be specified
in the language enacting the new benefit increase or provided
under subsection (c). This does not prevent the General
Assembly from extending or re-creating a new benefit increase
by law.
(e) Except as otherwise provided in the language creating
the new benefit increase, a new benefit increase that expires
under this Section continues to apply to persons who applied
and qualified for the affected benefit while the new benefit
increase was in effect and to the affected beneficiaries and
alternate payees of such persons, but does not apply to any
other person, including, without limitation, a person who
continues in service after the expiration date and did not
apply and qualify for the affected benefit while the new
benefit increase was in effect.
(Source: P.A. 101-10, eff. 6-5-19; 101-81, eff. 7-12-19;
101-610, eff. 1-1-20; 102-210, eff. 7-30-21; 102-856, eff.
1-1-23; 102-956, eff. 5-27-22.)
(40 ILCS 5/14-155.5 new)
Sec. 14-155.5. Defined contribution plan.
(a) As used in this Section, "defined benefit plan" means

SB3073 - 98 - LRB103 37686 RPS 67813 b
the retirement plan available under this Article to Tier 1 or
Tier 2 members who have not made the election authorized under
this Section.
(b) By July 1, 2026, the System shall prepare and
implement a defined contribution plan. The defined
contribution plan developed under this Section shall be a plan
that aggregates State and employee contributions in individual
participant accounts that, after meeting any other
requirements, are used for payouts after retirement in
accordance with this Section and any other applicable laws.
(1) Participation in the defined contribution plan for
persons who elect to participate shall begin on July 1,
2026. For persons who elect to participate on or after
July 1, 2026, participation in the defined contribution
plan shall begin as soon as practical after the election
is made.
(2) A participant in the defined contribution plan
shall pay employee contributions at a rate determined by
the participant, but not less than 3% of compensation and
not more than a percentage of compensation determined by
the board in accordance with the requirements of State and
federal law.
(3) State contributions shall be paid into the
accounts of all participants in the defined contribution
plan at a uniform rate, expressed as a percentage of
compensation and determined for each year. This rate shall

SB3073 - 99 - LRB103 37686 RPS 67813 b
be no higher than 7.6% of compensation and shall be no
lower than 3% of compensation. The State shall adjust this
rate annually.
(4) The defined contribution plan shall require 5
years of participation in the defined contribution plan
before vesting in State contributions. If the participant
fails to vest in them, the State contributions, and the
earnings thereon, shall be forfeited.
(5) The defined contribution plan may provide for
participants in the plan to be eligible for the defined
disability benefits available to other participants under
this Article. If it does, the System shall reduce the
employee contributions credited to the member's defined
contribution plan account by an amount determined by the
System to cover the cost of offering such benefits.
(6) The defined contribution plan shall provide a
variety of options for investments. These options shall
include investments handled by the Illinois State Board of
Investment as well as private sector investment options.
(7) The defined contribution plan shall provide a
variety of options for payouts to participants in the
defined contribution plan who are no longer active in the
System and their survivors.
(8) To the extent authorized under federal law and as
authorized by the System, the plan shall allow former
participants in the plan to transfer or roll over employee

SB3073 - 100 - LRB103 37686 RPS 67813 b
and vested State contributions, and the earnings thereon,
from the defined contribution plan into other qualified
retirement plans.
(9) The System shall reduce the employee contributions
credited to the member's defined contribution plan account
by an amount determined by the System to cover the cost of
offering these benefits and any applicable administrative
fees.
(b) Under the defined contribution plan, an active Tier 1
or Tier 2 member of this System may elect, in writing, to cease
accruing benefits in the defined benefit plan and begin
accruing benefits for future service in the defined
contribution plan. The election to participate in the defined
contribution plan is voluntary and irrevocable.
(1) Service credit under the defined contribution plan
may be used for determining retirement eligibility under
the defined benefit plan.
(2) On or before December 31, 2025, the System shall
notify all active Tier 1 and Tier 2 members who are
eligible to participate in the defined contribution plan.
The System shall mail information describing the option to
join the defined contribution plan to each of these
employees to his or her last known address on file with the
System. If the employee is not responsive to other means
of contact, it is sufficient for the System to publish the
details of the option on its website. Active Tier 1 and

SB3073 - 101 - LRB103 37686 RPS 67813 b
Tier 2 members who are notified by the System under this
paragraph must make the election to participate in the
defined contribution plan on or before December 31, 2025.
(3) If a person becomes an active participant of this
System on or after January 1, 2026, the System shall
notify the participant within one month after he or she
became an active participant that he or she is eligible to
participate in the defined contribution plan. The notice
shall be provided in the manner specified in paragraph (2)
of this subsection. The election to participate in the
defined contribution plan must be made as soon as
practical after the active participant is notified under
this paragraph.
(4) Upon request for further information describing
the option, the System shall provide employees with
information from the System before exercising the option
to join the plan, including information on the impact to
their benefits and service. The individual consultation
shall include projections of the member's defined benefits
at retirement or earlier termination of service and the
value of the member's account at retirement or earlier
termination of service. The System shall not provide
advice or counseling with respect to whether the employee
should exercise the option. The System shall inform Tier 1
and Tier 2 members who are eligible to participate in the
defined contribution plan that they may also wish to

SB3073 - 102 - LRB103 37686 RPS 67813 b
obtain information and counsel relating to their option
from any other available source, including but not limited
to labor organizations, private counsel, and financial
advisors.
(c) A Tier 1 or Tier 2 member who elects to participate in
the defined contribution plan may irrevocably elect to
terminate all participation in the defined benefit plan. Upon
that election, the System shall transfer to the member's
individual account an amount equal to the amount of
contribution refund that the member would be eligible to
receive if the member terminated employment on that date and
elected a refund of contributions, including regular interest
for the respective years. The System shall make the transfer
as a tax-free transfer in accordance with Internal Revenue
Service guidelines, for purposes of funding the amount
credited to the member's individual account.
(d) In no event shall the System, its staff, its
authorized representatives, or the Board be liable for any
information given to an employee under this Section. The
System may coordinate with the Department of Central
Management Services in accordance with this amendatory Act of
the 103rd General Assembly to provide information concerning
the impact of the defined contribution plan set forth in this
Section.
(e) Notwithstanding any other provision of this Section,
no person shall begin participating in the defined

SB3073 - 103 - LRB103 37686 RPS 67813 b
contribution plan until it has attained qualified plan status
and received all necessary approvals from the U.S. Internal
Revenue Service.
(f) The System shall report on its progress under this
Section, including the available details of the defined
contribution plan and the System's plans for informing
eligible Tier 1 and Tier 2 members about the plan, to the
Governor and the General Assembly on or before January 15,
2025.
(g) The Illinois State Board of Investment shall be the
plan sponsor for the defined contribution plan established
under this Section.
(h) The intent of this amendatory Act of the 103rd General
Assembly is to ensure that the State's normal cost of
participation in the defined contribution plan is similar, and
if possible equal, to the State's normal cost of participation
in the defined benefit plan, unless a lower State's normal
cost is necessary to ensure cost neutrality.
(40 ILCS 5/20-121) (from Ch. 108 1/2, par. 20-121)
(Text of Section WITHOUT the changes made by P.A. 98-599,
which has been held unconstitutional)
Sec. 20-121. Calculation of proportional retirement
annuities.
(a) Upon retirement of the employee, a proportional
retirement annuity shall be computed by each participating

SB3073 - 104 - LRB103 37686 RPS 67813 b
system in which pension credit has been established on the
basis of pension credits under each system. The computation
shall be in accordance with the formula or method prescribed
by each participating system which is in effect at the date of
the employee's latest withdrawal from service covered by any
of the systems in which he has pension credits which he elects
to have considered under this Article. However, the amount of
any retirement annuity payable under the self-managed plan
established under Section 15-158.2 of this Code depends solely
on the value of the participant's vested account balances and
is not subject to any proportional adjustment under this
Section.
(a-5) For persons who participate in a defined
contribution plan established under Article 14 of this Code to
whom the provisions of this Article apply, the pension credits
established under the defined contribution plan may be
considered in determining eligibility for or the amount of the
defined benefit retirement annuity that is payable by any
other participating system.
(b) Combined pension credit under all retirement systems
subject to this Article shall be considered in determining
whether the minimum qualification has been met and the formula
or method of computation which shall be applied, except as may
be otherwise provided with respect to vesting in State or
employer contributions in a defined contribution plan. If a
system has a step-rate formula for calculation of the

SB3073 - 105 - LRB103 37686 RPS 67813 b
retirement annuity, pension credits covering previous service
which have been established under another system shall be
considered in determining which range or ranges of the
step-rate formula are to be applicable to the employee.
(c) Interest on pension credit shall continue to
accumulate in accordance with the provisions of the law
governing the retirement system in which the same has been
established during the time an employee is in the service of
another employer, on the assumption such employee, for
interest purposes for pension credit, is continuing in the
service covered by such retirement system.
(Source: P.A. 91-887, eff. 7-6-00.)
(40 ILCS 5/20-123) (from Ch. 108 1/2, par. 20-123)
(Text of Section WITHOUT the changes made by P.A. 98-599,
which has been held unconstitutional)
Sec. 20-123. Survivor's annuity. The provisions governing
a retirement annuity shall be applicable to a survivor's
annuity. Appropriate credits shall be established for
survivor's annuity purposes in those participating systems
which provide survivor's annuities, according to the same
conditions and subject to the same limitations and
restrictions herein prescribed for a retirement annuity. If a
participating system has no survivor's annuity benefit, or if
the survivor's annuity benefit under that system is waived,
pension credit established in that system shall not be

SB3073 - 106 - LRB103 37686 RPS 67813 b
considered in determining eligibility for or the amount of the
survivor's annuity which may be payable by any other
participating system.
For persons who participate in the self-managed plan
established under Section 15-158.2 or the portable benefit
package established under Section 15-136.4, pension credit
established under Article 15 may be considered in determining
eligibility for or the amount of the survivor's annuity that
is payable by any other participating system, but pension
credit established in any other system shall not result in any
right to a survivor's annuity under the Article 15 system.
For persons who participate in a defined contribution plan
established under Article 14 of this Code to whom the
provisions of this Article apply, the pension credits
established under the defined contribution plan may be
considered in determining eligibility for or the amount of the
defined benefit survivor's annuity that is payable by any
other participating system, but pension credits established in
any other system shall not result in any right to or increase
in the value of a survivor's annuity under the defined
contribution plan, which depends solely on the options chosen
and the value of the participant's vested account balances and
is not subject to any proportional adjustment under this
Section.
(Source: P.A. 91-887, eff. 7-6-00.)

SB3073 - 107 - LRB103 37686 RPS 67813 b
(40 ILCS 5/20-124) (from Ch. 108 1/2, par. 20-124)
(Text of Section WITHOUT the changes made by P.A. 98-599,
which has been held unconstitutional)
Sec. 20-124. Maximum benefits.
(a) In no event shall the combined retirement or survivors
annuities exceed the highest annuity which would have been
payable by any participating system in which the employee has
pension credits, if all of his pension credits had been
validated in that system.
If the combined annuities should exceed the highest
maximum as determined in accordance with this Section, the
respective annuities shall be reduced proportionately
according to the ratio which the amount of each proportional
annuity bears to the aggregate of all such annuities.
(b) In the case of a participant in the self-managed plan
established under Section 15-158.2 of this Code to whom the
provisions of this Article apply:
(i) For purposes of calculating the combined
retirement annuity and the proportionate reduction, if
any, in a retirement annuity other than one payable under
the self-managed plan, the amount of the Article 15
retirement annuity shall be deemed to be the highest
annuity to which the annuitant would have been entitled if
he or she had participated in the traditional benefit
package as defined in Section 15-103.1 rather than the
self-managed plan.

SB3073 - 108 - LRB103 37686 RPS 67813 b
(ii) For purposes of calculating the combined
survivor's annuity and the proportionate reduction, if
any, in a survivor's annuity other than one payable under
the self-managed plan, the amount of the Article 15
survivor's annuity shall be deemed to be the highest
survivor's annuity to which the survivor would have been
entitled if the deceased employee had participated in the
traditional benefit package as defined in Section 15-103.1
rather than the self-managed plan.
(iii) Benefits payable under the self-managed plan are
not subject to proportionate reduction under this Section.
(c) In the case of a participant in a defined contribution
plan established under Article 14 of this Code to whom the
provisions of this Article apply:
(i) For purposes of calculating the combined
retirement annuity and the proportionate reduction, if
any, in a defined benefit retirement annuity, any benefit
payable under the defined contribution plan shall not be
considered.
(ii) For purposes of calculating the combined
survivor's annuity and the proportionate reduction, if
any, in a defined benefit survivor's annuity, any benefit
payable under the defined contribution plan shall not be
considered.
(iii) Benefits payable under a defined contribution
plan established under Article 14 of this Code are not

SB3073 - 109 - LRB103 37686 RPS 67813 b
subject to proportionate reduction under this Section.
(Source: P.A. 91-887, eff. 7-6-00.)
(40 ILCS 5/20-125) (from Ch. 108 1/2, par. 20-125)
(Text of Section WITHOUT the changes made by P.A. 98-599,
which has been held unconstitutional)
Sec. 20-125. Return to employment - suspension of
benefits. If a retired employee returns to employment which is
covered by a system from which he is receiving a proportional
annuity under this Article, his proportional annuity from all
participating systems shall be suspended during the period of
re-employment, except that this suspension does not apply to
any distributions payable under the self-managed plan
established under Section 15-158.2 of this Code or under a
defined contribution plan established under Article 14 of this
Code.
The provisions of the Article under which such employment
would be covered shall govern the determination of whether the
employee has returned to employment, and if applicable the
exemption of temporary employment or employment not exceeding
a specified duration or frequency, for all participating
systems from which the retired employee is receiving a
proportional annuity under this Article, notwithstanding any
contrary provisions in the other Articles governing such
systems.
(Source: P.A. 91-887, eff. 7-6-00.)

SB3073 - 110 - LRB103 37686 RPS 67813 b