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House Bill No. 5506

Public Act No. 22-118 233 of 739

determined by the board to be included for the purpose of inflating the member's average annual salary. The inclusion in annual salary of amounts paid to the member, in lieu of payment by the employer for the cost of benefits, insurance, or individual retirement arrangements which in prior years had been paid by the employer and not included in the member's annual salary, shall be prima facie evidence that such amounts are included for the purpose of inflating the member's average annual salary. Annual salary shall not (A) include payments the timing of which may be directed by the member, (B) include payments to a superintendent pursuant to an individual contract between such superintendent and a board of education, of amounts which are not included in base salary, or (C) exceed the maximum amount allowed under Section 401(a)(17) of the Internal Revenue Code for the applicable limitation year, provided in no event shall the limitation under Section 401(a)(17) of the Internal Revenue Code apply to the annual salary of a member whose membership began prior to January 1, 1996, if such limitation would reduce the amount of the member's annual salary below the amount permitted for calculation of the member's retirement benefit under chapter 167a, without regard to the limitation under Section 401(a)(17) of the Internal Revenue Code. Annual salary shall include amounts paid to the member during a sabbatical leave during which mandatory contributions were remitted, provided such member returned to full-time teaching for at least five full years following the completion of such leave. (4) "Average annual salary" means the average [annual salary received during the three years of highest salary] of the three highest annual salaries received as an active member. (5) "Board" means the Teachers' Retirement Board. (6) "Child" means a natural child, an adopted child, or a stepchild of a deceased member who has been a stepchild for at least one year immediately prior to the date on which the member died. A child is a