40 ILCS 5/13-302

Current through Public Act 103-1052

Section 40 ILCS 5/13-302 - Computation of retirement annuity

(a) Computation of annuity. An employee who withdraws from service on or after July 1, 1989 and who has met the age and service requirements and other conditions for eligibility set forth in Section 13-301 of this Article is entitled to receive a retirement annuity for life equal to 2.2% of average final salary for each of the first 20 years of service, and 2.4% of average final salary for each year of service in excess of 20. The retirement annuity shall not exceed 80% of average final salary.

(b) Early retirement discount. If an employee retires prior to attainment of age 60 with less than 30 years of service, the annuity computed above shall be reduced by 1/2 of 1% for each full month between the date the annuity begins and attainment of age 60, or each full month by which the employee's service is less than 30 years, whichever is less. However, where the employee first enters service after June 13, 1997 and does not have at least 10 years of service exclusive of credit under Article 20, the annuity computed above shall be reduced by 1/2 of 1% for each full month between the date the annuity begins and attainment of age 60.

(c) Rule of 80 - Early retirement without discount. For an employee who retires on or after January 1, 2003 but on or before December 31, 2007, if the employee is eligible for a retirement annuity under Section 13-301 and has at least 10 years of service exclusive of credit under Article 20 and if at the date of withdrawal the employee's age when added to the number of years of his or her creditable service equals at least 80, the early retirement discount in subsection (b) of this Section does not apply. For purposes of this Rule of 80, portions of years shall be considered in whole months.

An employee who has terminated employment with the employer under this Article prior to the effective date of this amendatory Act of the 92nd General Assembly and subsequently re-enters service must remain in service with the employer under this Article for at least 2 years after re-entry during the period beginning on January 1, 2003 and ending on December 31, 2007 to be entitled to early retirement without discount under this subsection (c).

In the case of an employee who retires under the terms of Article 20, eligibility for early retirement without discount under this subsection (c) shall be based upon the employee's age and service credit at the time of withdrawal from the final fund.

(c-1) Early retirement without discount; retirement after June 29, 1997 and before January 1, 2003. An employee who (i) has attained age 55 (age 50 if the employee first entered service before June 13, 1997), (ii) has at least 10 years of service exclusive of credit under Article 20, (iii) retires after June 29, 1997 and before January 1, 2003, and (iv) retires within 6 months of the last day for which retirement contributions were required, may elect at the time of application to make a one-time employee contribution to the Fund and thereby avoid the early retirement reduction specified in subsection (b). The exercise of the election shall also obligate the employer to make a one-time nonrefundable contribution to the Fund.

The one-time employee and employer contributions shall be a percentage of the retiring employee's highest full-time annual salary, calculated as the total amount of salary included in the highest 26 consecutive pay periods as used in the average final salary calculation, and based on the employee's age and service at retirement. The employee rate shall be 7% multiplied by the lesser of the following 2 numbers: (1) the number of years, or portion thereof, that the employee is less than age 60; or (2) the number of years, or portion thereof, that the employee's service is less than 30 years. The employer contribution shall be at the rate of 20% for each year, or portion thereof, that the participant is less than age 60.

Upon receipt of the application, the Board shall determine the corresponding employee and employer contributions. The annuity shall not be payable under this subsection until both the required contributions have been received by the Fund. However, the date the contributions are received shall not be considered in determining the effective date of retirement.

The number of employees who may retire under this Section in any year may be limited at the option of the District to a specified percentage of those eligible, not lower than 30%, with the right to participate to be allocated among those applying on the basis of seniority in the service of the employer.

An employee who has terminated employment and subsequently re-enters service shall not be entitled to early retirement without discount under this subsection unless the employee continues in service for at least 4 years after re-entry.

(d) Annual increase. Except for employees retiring and receiving a term annuity, an employee who retires on or after July 1, 1985 but before July 12, 2001, shall, upon the first payment date following the first anniversary of the date of retirement, have the monthly annuity increased by 3% of the amount of the monthly annuity fixed at the date of retirement. Except for employees retiring and receiving a term annuity, an employee who retires on or after July 12, 2001 shall, on the first day of the month in which the first anniversary of the date of retirement occurs, have the monthly annuity increased by 3% of the amount of the monthly annuity fixed at the date of retirement. The monthly annuity shall be increased by an additional 3% on the same date each year thereafter. Beginning January 1, 1993, all annual increases payable under this subsection (or any predecessor provision, regardless of the date of retirement) shall be calculated at the rate of 3% of the monthly annuity payable at the time of the increase, including any increases previously granted under this Article.

Any employee who (i) retired before July 1, 1985 with at least 10 years of creditable service, (ii) is receiving a retirement annuity under this Article, other than a term annuity, and (iii) has not received any annual increase under this subsection, shall begin receiving the annual increases provided under this subsection (d) beginning on the next annuity payment date following June 13, 1997.

(e) Minimum retirement annuity. Beginning January 1, 1993, the minimum monthly retirement annuity shall be $500 for any annuitant having at least 10 years of service under this Article, other than a term annuitant or an annuitant who began receiving the annuity before attaining age 60. Any such annuitant who is receiving a monthly annuity of less than $500 shall have the annuity increased to $500 on that date.

Beginning January 1, 1993, the minimum monthly retirement annuity shall be $250 for any annuitant (other than a term or reciprocal annuitant or an annuitant under subsection (d) of Section 13-301) having less than 10 years of service under this Article, and for any annuitant (other than a term annuitant) having at least 10 years of service under this Article who began receiving the annuity before attaining age 60. Any such annuitant who is receiving a monthly annuity of less than $250 shall have the annuity increased to $250 on that date.

Beginning August 1, 2001 (and without regard to whether the annuitant was in service on or after that effective date), the minimum monthly retirement annuity for any annuitant having at least 10 years of service, other than an annuitant whose annuity is subject to an early retirement discount, shall be $500 plus $25 for each year of service in excess of 10, not to exceed $750 for an annuitant with 20 or more years of service. In the case of a reciprocal annuity, this minimum shall apply only if the annuitant has at least 10 years of service under this Article, and the amount of the minimum annuity shall be reduced by the sum of all the reciprocal annuities payable to the annuitant by other participating systems under Article 20 of this Code.

Notwithstanding any other provision of this subsection, beginning on the first annuity payment date following July 12, 2001, an employee who retired before August 23, 1989 with at least 10 years of service under this Article but before attaining age 60 (regardless of whether the retirement annuity was subject to an early retirement discount) shall be entitled to the same minimum monthly retirement annuity under this subsection as an employee who retired with at least 10 years of service under this Article and after attaining age 60.

Notwithstanding any other provision of this subsection, beginning on the first day of the month following the month in which this amendatory Act of the 94th General Assembly takes effect (and without regard to whether the annuitant was in service on or after that effective date), an employee who retired on or after August 23, 1989 with at least 10 years of service under this Article but before attaining age 60 (regardless of whether the retirement annuity was subject to an early retirement discount), except for an employee who is eligible for an annuity under Section 13-301(d), shall be entitled to the same minimum monthly retirement annuity under this subsection as an employee who retired with at least 10 years of service under this Article and after attaining age 60.

40 ILCS 5/13-302

Amended by P.A. 094-0621, § 5, eff. 8/18/2005.

P.A. 90-12, eff. 6-13-97; 92-53, eff. 7-12-01; 92-599, eff. 6-28-02.