HB5354 101ST GENERAL ASSEMBLY

LRB101 18247 RPS 67689 b

101ST GENERAL ASSEMBLY
State of Illinois
2019 and 2020
HB5354

Introduced , by Rep. Jim Durkin

SYNOPSIS AS INTRODUCED:

40 ILCS 5/2-105.3 new
40 ILCS 5/2-107.9 new
40 ILCS 5/2-107.10 new
40 ILCS 5/2-108	from Ch. 108 1/2, par. 2-108
40 ILCS 5/2-110.3 new
40 ILCS 5/2-119.1	from Ch. 108 1/2, par. 2-119.1
40 ILCS 5/2-124	from Ch. 108 1/2, par. 2-124
40 ILCS 5/2-126	from Ch. 108 1/2, par. 2-126
40 ILCS 5/2-134	from Ch. 108 1/2, par. 2-134
40 ILCS 5/2-162
40 ILCS 15/1.10 new

Amends the General Assembly Article of the Illinois Pension Code. Requires active Tier 1 employees to elect either to (i) have automatic annual increases in retirement and survivor's annuities delayed and reduced or (ii) not agree to the delay and reduction. Provides that a Tier 1 employee who elects to have automatic annual increases in retirement and survivor's annuities delayed and reduced is entitled to have future increases in income treated as pensionable income, have contributions reduced to a specified rate, and receive a consideration payment of 10% of contributions made prior to the election. Provides that a Tier 1 employee who elects to not agree to the delay and reduction is not eligible to have future increases in income treated as pensionable income. Makes funding changes. Makes other changes. Amends the State Pension Funds Continuing Appropriation Act to provide a continuing appropriation for the amounts of the consideration payments. Effective immediately.

FISCAL NOTE ACT MAY APPLY

PENSION IMPACT NOTE ACT MAY APPLY

A BILL FOR

AN ACT concerning public employee benefits.

Be it enacted by the People of the State of Illinois, represented in the General Assembly:

Section 5. The Illinois Pension Code is amended by changing Sections 2-108, 2-119.1, 2-124, 2-126, 2-134, and 2-162 and by adding Sections 2-105.3, 2-107.9, 2-107.10, and 2-110.3 as follows:

(40 ILCS 5/2-105.3 new)

Sec. 2-105.3. Tier 1 employee. "Tier 1 employee": A participant who first became a participant before January 1, 2011.

(40 ILCS 5/2-107.9 new)

Sec. 2-107.9. Future increase in income. "Future increase in income" means an increase to a Tier 1 employee's base pay that is offered to the Tier 1 employee for service under this Article after June 30, 2021 that qualifies as "salary", as defined in Section 2-108, or would qualify as "salary" but for the fact that it was offered to and accepted by the Tier 1 employee under the condition set forth in subsection (c) of Section 2-110.3.

(40 ILCS 5/2-107.10 new)

Sec. 2-107.10. Base pay. As used in Section 2-107.9 of this Code, "base pay" means the Tier 1 employee's annualized rate of salary as of June 30, 2021. For a person returning to active service as a Tier 1 employee after June 30, 2021, however, "base pay" means the employee's annualized rate of salary as of the employee's last date of service prior to July 1, 2021. The System shall calculate the base pay of each Tier 1 employee pursuant to this Section.

(40 ILCS 5/2-108) (from Ch. 108 1/2, par. 2-108)

(Text of Section WITHOUT the changes made by P.A. 98-599, which has been held unconstitutional)

Sec. 2-108. Salary. "Salary":

(1) For members of the General Assembly, the total compensation paid to the member by the State for one year of service, including the additional amounts, if any, paid to the member as an officer pursuant to Section 1 of "An Act in relation to the compensation and emoluments of the members of the General Assembly", approved December 6, 1907, as now or hereafter amended.

(2) For the State executive officers specified in Section 2-105, the total compensation paid to the member for one year of service.

(3) For members of the System who are participants under Section 2-117.1, or who are serving as Clerk or Assistant Clerk of the House of Representatives or Secretary or Assistant Secretary of the Senate, the total compensation paid to the member for one year of service, but not to exceed the salary of the highest salaried officer of the General Assembly.

However, in the event that federal law results in any participant receiving imputed income based on the value of group term life insurance provided by the State, such imputed income shall not be included in salary for the purposes of this Article.

Notwithstanding any other provision of this Section, "salary" does not include any future increase in income that is offered for service to a Tier 1 employee under this Article pursuant to the condition set forth in subsection (c) of Section 2-110.3 and accepted under that condition by a Tier 1 employee who has made the election under paragraph (2) of subsection (a) of Section 2-110.3.

Notwithstanding any other provision of this Section, "salary" does not include any consideration payment made to a Tier 1 employee.

(Source: P.A. 86-27; 86-273; 86-1028; 86-1488.)

(40 ILCS 5/2-110.3 new)

Sec. 2-110.3. Election by Tier 1 employees.

(a) Each active Tier 1 employee shall make an irrevocable election either:

(1) to agree to delay his or her eligibility for automatic annual increases in retirement annuity as provided in subsection (a-1) of Section 2-119.1 and to have the amount of the automatic annual increases in his or her retirement annuity and survivor's annuity that are otherwise provided for in this Article calculated, instead, as provided in subsection (a-1) of Section 2-119.1; or

(2) to not agree to paragraph (1) of this subsection.

The election required under this subsection (a) shall be made by each active Tier 1 employee no earlier than January 1, 2021 and no later than March 31, 2021, except that a person who returns to active service as a Tier 1 employee under this Article on or after January 1, 2021 and has not yet made an election under this Section must make the election under this subsection (a) within 60 days after returning to active service as a Tier 1 employee.

If a Tier 1 employee fails for any reason to make a required election under this subsection within the time specified, then the employee shall be deemed to have made the election under paragraph (2) of this subsection.

(a-5) If this Section is enjoined or stayed by an Illinois court or a court of competent jurisdiction pending the entry of a final and unappealable decision, and this Section is determined to be constitutional or otherwise valid by a final unappealable decision of an Illinois court or a court of competent jurisdiction, then the election procedure set forth in subsection (a) of this Section shall commence on the 180th calendar day after the date of the issuance of the final unappealable decision and shall conclude at the end of the 270th calendar day after that date.

(a-10) All elections under subsection (a) that are made or deemed to be made before July 1, 2021 shall take effect on July 1, 2021. Elections that are made or deemed to be made on or after July 1, 2021 shall take effect on the first day of the month following the month in which the election is made or deemed to be made.

(b) As adequate and legal consideration provided under this amendatory Act of the 101st General Assembly for making an election under paragraph (1) of subsection (a) of this Section, the State of Illinois shall be expressly and irrevocably prohibited from offering any future increases in income to a Tier 1 employee who has made an election under paragraph (1) of subsection (a) of this Section on the condition of not constituting salary under Section 2-108.

As adequate and legal consideration provided under this amendatory Act of the 101st General Assembly for making an election under paragraph (1) of subsection (a) of this Section, each Tier 1 employee who has made an election under paragraph (1) of subsection (a) of this Section shall receive a consideration payment equal to 10% of the contributions made by or on behalf of the employee under Section 2-126 before the effective date of that election. The State Comptroller shall pay the consideration payment to the Tier 1 employee out of funds appropriated for that purpose under Section 1.10 of the State Pension Funds Continuing Appropriation Act. The System shall calculate the amount of each consideration payment and, by July 1, 2021, shall certify to the State Comptroller the amount of the consideration payment, together with the name, address, and any other available payment information of the Tier 1 employee as found in the records of the System. The System shall make additional calculations and certifications of consideration payments to the State Comptroller as the System deems necessary.

(c) A Tier 1 employee who makes the election under paragraph (2) of subsection (a) of this Section shall not be subject to paragraph (1) of subsection (a) of this Section. However, each future increase in income offered for service as a member under this Article to a Tier 1 employee who has made the election under paragraph (2) of subsection (a) of this Section shall be offered expressly and irrevocably on the condition of not constituting salary under Section 2-108 and that the Tier 1 employee's acceptance of the offered future increase in income shall constitute his or her agreement to that condition.

(d) The System shall make a good faith effort to contact each Tier 1 employee subject to this Section. The System shall mail information describing the required election to each Tier 1 employee by United States Postal Service mail to his or her last known address on file with the System. If the Tier 1 employee is not responsive to other means of contact, it is sufficient for the System to publish the details of any required elections on its website or to publish those details in a regularly published newsletter or other existing public forum.

Tier 1 employees who are subject to this Section shall be provided with an election packet containing information regarding their options, as well as the forms necessary to make the required election. Upon request, the System shall offer Tier 1 employees an opportunity to receive information from the System before making the required election. The information may be provided through video materials, group presentations, individual consultation with a member or authorized representative of the System in person or by telephone or other electronic means, or any combination of those methods. The System shall not provide advice or counseling with respect to which election a Tier 1 employee should make or specific to the legal or tax circumstances of or consequences to the Tier 1 employee.

The System shall inform Tier 1 employees in the election packet required under this subsection that the Tier 1 employee may also wish to obtain information and counsel relating to the election required under this Section from any other available source, including, but not limited to, labor organizations and private counsel.

In no event shall the System, its staff, or the Board be held liable for any information given to a member regarding the elections under this Section. The System shall coordinate with the Illinois Department of Central Management Services and each other retirement system administering an election in accordance with this amendatory Act of the 101st General Assembly to provide information concerning the impact of the election set forth in this Section.

(e) Notwithstanding any other provision of law, each future increase in income offered by the State of Illinois for service as a member must be offered expressly and irrevocably on the condition of not constituting "salary" under Section 2-108 to any Tier 1 employee who has made an election under paragraph (2) of subsection (a) of this Section. The offer shall also provide that the Tier 1 employee's acceptance of the offered future increase in income shall constitute his or her agreement to the condition set forth in this subsection.

For purposes of legislative intent, the condition set forth in this subsection shall be construed in a manner that ensures that the condition is not violated or circumvented through any contrivance of any kind.

(f) A member's election under this Section is not a prohibited election under subdivision (j)(1) of Section 1-119 of this Code.

(g) No provision of this Section shall be interpreted in a way that would cause the System to cease to be a qualified plan under Section 401(a) of the Internal Revenue Code of 1986. The provisions of this Section shall be subject to and implemented in a manner that complies with Section 11 of Article IV of the Illinois Constitution.

(40 ILCS 5/2-119.1) (from Ch. 108 1/2, par. 2-119.1)

(Text of Section WITHOUT the changes made by P.A. 98-599, which has been held unconstitutional)

Sec. 2-119.1. Automatic increase in retirement annuity.

(a) Except as provided in subsection (a-1), a A participant who retires after June 30, 1967, and who has not received an initial increase under this Section before the effective date of this amendatory Act of 1991, shall, in January or July next following the first anniversary of retirement, whichever occurs first, and in the same month of each year thereafter, but in no event prior to age 60, have the amount of the originally granted retirement annuity increased as follows: for each year through 1971, 1 1/2%; for each year from 1972 through 1979, 2%; and for 1980 and each year thereafter, 3%. Annuitants who have received an initial increase under this subsection prior to the effective date of this amendatory Act of 1991 shall continue to receive their annual increases in the same month as the initial increase.

(a-1) Notwithstanding any other provision of this Article, for a Tier 1 employee who made the election under paragraph (1) of subsection (a) of Section 2-110.3:

(1) The initial increase in retirement annuity under this Section shall occur on the January 1 occurring either on or after the attainment of age 67 or the fifth anniversary of the annuity start date, whichever is earlier.

(2) The amount of each automatic annual increase in retirement annuity or survivor's annuity occurring on or after the effective date of that election shall be calculated as a percentage of the originally granted retirement annuity or survivor's annuity, equal to 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. 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 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 board of the retirement system by November 1 of each year.

(b) Beginning January 1, 1990, for eligible participants who remain in service after attaining 20 years of creditable service, the 3% increases provided under subsection (a) shall begin to accrue on the January 1 next following the date upon which the participant (1) attains age 55, or (2) attains 20 years of creditable service, whichever occurs later, and shall continue to accrue while the participant remains in service; such increases shall become payable on January 1 or July 1, whichever occurs first, next following the first anniversary of retirement. For any person who has service credit in the System for the entire period from January 15, 1969 through December 31, 1992, regardless of the date of termination of service, the reference to age 55 in clause (1) of this subsection (b) shall be deemed to mean age 50.

This subsection (b) does not apply to any person who first becomes a member of the System after August 8, 2003 (the effective date of Public Act 93-494) this amendatory Act of the 93rd General Assembly.

(b-5) Notwithstanding any other provision of this Article, a participant who first becomes a participant on or after January 1, 2011 (the effective date of Public Act 96-889) shall, in January or July next following the first anniversary of retirement, whichever occurs first, and in the same month of each year thereafter, but in no event prior to age 67, have the amount of the retirement annuity then being paid increased by 3% or the annual unadjusted percentage increase in the Consumer Price Index for All Urban Consumers as determined by the Public Pension Division of the Department of Insurance under subsection (a) of Section 2-108.1, whichever is less.

(c) The foregoing provisions relating to automatic increases are not applicable to a participant who retires before having made contributions (at the rate prescribed in Section 2-126) for automatic increases for less than the equivalent of one full year. However, in order to be eligible for the automatic increases, such a participant may make arrangements to pay to the system the amount required to bring the total contributions for the automatic increase to the equivalent of one year's contributions based upon his or her last salary.

(d) A participant who terminated service prior to July 1, 1967, with at least 14 years of service is entitled to an increase in retirement annuity beginning January, 1976, and to additional increases in January of each year thereafter.

The initial increase shall be 1 1/2% of the originally granted retirement annuity multiplied by the number of full years that the annuitant was in receipt of such annuity prior to January 1, 1972, plus 2% of the originally granted retirement annuity for each year after that date. The subsequent annual increases shall be at the rate of 2% of the originally granted retirement annuity for each year through 1979 and at the rate of 3% for 1980 and thereafter.

(e) Beginning January 1, 1990, and except as provided in subsection (a-1), all automatic annual increases payable under this Section shall be calculated as a percentage of the total annuity payable at the time of the increase, including previous increases granted under this Article.

(Source: P.A. 96-889, eff. 1-1-11; 96-1490, eff. 1-1-11.)

(40 ILCS 5/2-124) (from Ch. 108 1/2, par. 2-124)

Sec. 2-124. Contributions by State.

(a) The State shall make contributions to the System by appropriations of amounts which, together with the contributions of participants, interest earned on investments, and other income will meet the cost of maintaining and administering the System on a 90% funded basis in accordance with actuarial recommendations.

(b) The Board shall determine the amount of State contributions required for each fiscal year on the basis of the actuarial tables and other assumptions adopted by the Board and the prescribed rate of interest, using the formula in subsection (c).

(c) For State fiscal years 2012 through 2045 (except as otherwise provided for fiscal year 2022), the minimum contribution to the System to be made by the State for each fiscal year shall be an amount determined by the System to be sufficient to bring the total assets of the System up to 90% of the total actuarial liabilities of the System by the end of State fiscal year 2045. In making these determinations, the required State contribution shall be calculated each year as a level percentage of payroll over the years remaining to and including fiscal year 2045 and shall be determined under the projected unit credit actuarial cost method.

For State fiscal year 2022:

(1) The initial calculation and certification shall be based on the amount determined above.

(2) For purposes of the recertification due on or before May 1, 2021, the recalculation of the required State contribution for fiscal year 2022 shall take into account the effect on the System's liabilities of the elections made under Section 2-110.3.

(3) For purposes of the recertification due on or before October 1, 2021, the total required State contribution for fiscal year 2022 shall be reduced by the amount of the consideration payments made to Tier 1 employees who made the election under paragraph (1) of subsection (a) of Section 2-110.3.

If Section 2-110.3 is determined to be unconstitutional or otherwise invalid by a final unappealable decision of an Illinois court or a court of competent jurisdiction, then the changes made to this Section by this amendatory Act of the 101st General Assembly shall not take effect and are repealed by operation of law.

A change in an actuarial or investment assumption that increases or decreases the required State contribution and first applies in State fiscal year 2018 or thereafter shall be implemented in equal annual amounts over a 5-year period beginning in the State fiscal year in which the actuarial change first applies to the required State contribution.

A change in an actuarial or investment assumption that increases or decreases the required State contribution and first applied to the State contribution in fiscal year 2014, 2015, 2016, or 2017 shall be implemented:

(i) as already applied in State fiscal years before 2018; and

(ii) in the portion of the 5-year period beginning in the State fiscal year in which the actuarial change first applied that occurs in State fiscal year 2018 or thereafter, by calculating the change in equal annual amounts over that 5-year period and then implementing it at the resulting annual rate in each of the remaining fiscal years in that 5-year period.

For State fiscal years 1996 through 2005, the State contribution to the System, as a percentage of the applicable employee payroll, shall be increased in equal annual increments so that by State fiscal year 2011, the State is contributing at the rate required under this Section.

Notwithstanding any other provision of this Article, the total required State contribution for State fiscal year 2006 is $4,157,000.

Notwithstanding any other provision of this Article, the total required State contribution for State fiscal year 2007 is $5,220,300.

For each of State fiscal years 2008 through 2009, the State contribution to the System, as a percentage of the applicable employee payroll, shall be increased in equal annual increments from the required State contribution for State fiscal year 2007, so that by State fiscal year 2011, the State is contributing at the rate otherwise required under this Section.

Notwithstanding any other provision of this Article, the total required State contribution for State fiscal year 2010 is $10,454,000 and shall be made from the proceeds of bonds sold in fiscal year 2010 pursuant to Section 7.2 of the General Obligation Bond Act, less (i) the pro rata share of bond sale expenses determined by the System's share of total bond proceeds, (ii) any amounts received from the General Revenue Fund in fiscal year 2010, and (iii) any reduction in bond proceeds due to the issuance of discounted bonds, if applicable.

Notwithstanding any other provision of this Article, the total required State contribution for State fiscal year 2011 is the amount recertified by the System on or before April 1, 2011 pursuant to Section 2-134 and shall be made from the proceeds of bonds sold in fiscal year 2011 pursuant to Section 7.2 of the General Obligation Bond Act, less (i) the pro rata share of bond sale expenses determined by the System's share of total bond proceeds, (ii) any amounts received from the General Revenue Fund in fiscal year 2011, and (iii) any reduction in bond proceeds due to the issuance of discounted bonds, if applicable.

Beginning in State fiscal year 2046, the minimum State contribution for each fiscal year shall be the amount needed to maintain the total assets of the System at 90% of the total actuarial liabilities of the System.

Amounts received by the System pursuant to Section 25 of the Budget Stabilization Act or Section 8.12 of the State Finance Act in any fiscal year do not reduce and do not constitute payment of any portion of the minimum State contribution required under this Article in that fiscal year. Such amounts shall not reduce, and shall not be included in the calculation of, the required State contributions under this Article in any future year until the System has reached a funding ratio of at least 90%. A reference in this Article to the "required State contribution" or any substantially similar term does not include or apply to any amounts payable to the System under Section 25 of the Budget Stabilization Act.

Notwithstanding any other provision of this Section, the required State contribution for State fiscal year 2005 and for fiscal year 2008 and each fiscal year thereafter, as calculated under this Section and certified under Section 2-134, shall not exceed an amount equal to (i) the amount of the required State contribution that would have been calculated under this Section for that fiscal year if the System had not received any payments under subsection (d) of Section 7.2 of the General Obligation Bond Act, minus (ii) the portion of the State's total debt service payments for that fiscal year on the bonds issued in fiscal year 2003 for the purposes of that Section 7.2, as determined and certified by the Comptroller, that is the same as the System's portion of the total moneys distributed under subsection (d) of Section 7.2 of the General Obligation Bond Act. In determining this maximum for State fiscal years 2008 through 2010, however, the amount referred to in item (i) shall be increased, as a percentage of the applicable employee payroll, in equal increments calculated from the sum of the required State contribution for State fiscal year 2007 plus the applicable portion of the State's total debt service payments for fiscal year 2007 on the bonds issued in fiscal year 2003 for the purposes of Section 7.2 of the General Obligation Bond Act, so that, by State fiscal year 2011, the State is contributing at the rate otherwise required under this Section.

(d) For purposes of determining the required State contribution to the System, the value of the System's assets shall be equal to the actuarial value of the System's assets, which shall be calculated as follows:

As of June 30, 2008, the actuarial value of the System's assets shall be equal to the market value of the assets as of that date. In determining the actuarial value of the System's assets for fiscal years after June 30, 2008, any actuarial gains or losses from investment return incurred in a fiscal year shall be recognized in equal annual amounts over the 5-year period following that fiscal year.

(e) For purposes of determining the required State contribution to the system for a particular year, the actuarial value of assets shall be assumed to earn a rate of return equal to the system's actuarially assumed rate of return.

(Source: P.A. 100-23, eff. 7-6-17.)

(40 ILCS 5/2-126) (from Ch. 108 1/2, par. 2-126)

(Text of Section WITHOUT the changes made by P.A. 98-599, which has been held unconstitutional)

Sec. 2-126. Contributions by participants.

(a) Each participant shall contribute toward the cost of his or her retirement annuity a percentage of each payment of salary received by him or her for service as a member as follows: for service between October 31, 1947 and January 1, 1959, 5%; for service between January 1, 1959 and June 30, 1969, 6%; for service between July 1, 1969 and January 10, 1973, 6 1/2%; for service after January 10, 1973, 7%; for service after December 31, 1981, 8 1/2%.

(b) Beginning August 2, 1949, each male participant, and from July 1, 1971, each female participant shall contribute towards the cost of the survivor's annuity 2% of salary.

A participant who has no eligible survivor's annuity beneficiary may elect to cease making contributions for survivor's annuity under this subsection. A survivor's annuity shall not be payable upon the death of a person who has made this election, unless prior to that death the election has been revoked and the amount of the contributions that would have been paid under this subsection in the absence of the election is paid to the System, together with interest at the rate of 4% per year from the date the contributions would have been made to the date of payment.

(c) Beginning July 1, 1967, each participant shall contribute 1% of salary towards the cost of automatic increase in annuity provided in Section 2-119.1. These contributions shall be made concurrently with contributions for retirement annuity purposes.

(d) In addition, each participant serving as an officer of the General Assembly shall contribute, for the same purposes and at the same rates as are required of a regular participant, on each additional payment received as an officer. If the participant serves as an officer for at least 2 but less than 4 years, he or she shall contribute an amount equal to the amount that would have been contributed had the participant served as an officer for 4 years. Persons who serve as officers in the 87th General Assembly but cannot receive the additional payment to officers because of the ban on increases in salary during their terms may nonetheless make contributions based on those additional payments for the purpose of having the additional payments included in their highest salary for annuity purposes; however, persons electing to make these additional contributions must also pay an amount representing the corresponding employer contributions, as calculated by the System.

(e) Notwithstanding any other provision of this Article, the required contribution of a participant who first becomes a participant on or after January 1, 2011 shall not exceed the contribution that would be due under this Article if that participant's highest salary for annuity purposes were $106,800, plus any increases in that amount under Section 2-108.1.

(f) Beginning July 1, 2021 or the effective date of the Tier 1 employee's election under paragraph (1) of subsection (a) of Section 2-110.3, whichever is later, in lieu of the contributions otherwise required under this Section, each Tier 1 employee who made the election under paragraph (1) of subsection (a) of Section 2-110.3 shall contribute 8.5% of each payment of salary toward the cost of his or her retirement annuity and 1.85% of each payment of salary toward the cost of the survivor's annuity.

(g) Notwithstanding subsection (f) of this Section, beginning July 1, 2021 or the effective date of the Tier 1 employee's election under paragraph (1) of subsection (a) of Section 2-110.3, whichever is later, in lieu of the contributions otherwise required under this Section, each Tier 1 employee who made the election under paragraph (1) of subsection (a) of Section 2-110.3 and has elected to cease making contributions for survivor's annuity under subsection (b) of this Section, shall contribute 8.55% of each payment of salary toward the cost of his or her retirement annuity.

(Source: P.A. 96-1490, eff. 1-1-11.)

(40 ILCS 5/2-134) (from Ch. 108 1/2, par. 2-134)

Sec. 2-134. To certify required State contributions and submit vouchers.

(a) The Board shall certify to the Governor on or before December 15 of each year until December 15, 2011 the amount of the required State contribution to the System for the next fiscal year and shall specifically identify the System's projected State normal cost for that fiscal year. The certification shall include a copy of the actuarial recommendations upon which it is based and shall specifically identify the System's projected State normal cost for that fiscal year.

On or before November 1 of each year, beginning November 1, 2012, the Board shall submit to the State Actuary, the Governor, and the General Assembly a proposed certification of the amount of the required State contribution to the System for the next fiscal year, along with all of the actuarial assumptions, calculations, and data upon which that proposed certification is based. On or before January 1 of each year beginning January 1, 2013, the State Actuary shall issue a preliminary report concerning the proposed certification and identifying, if necessary, recommended changes in actuarial assumptions that the Board must consider before finalizing its certification of the required State contributions. On or before January 15, 2013 and every January 15 thereafter, the Board shall certify to the Governor and the General Assembly the amount of the required State contribution for the next fiscal year. The Board's certification must note any deviations from the State Actuary's recommended changes, the reason or reasons for not following the State Actuary's recommended changes, and the fiscal impact of not following the State Actuary's recommended changes on the required State contribution.

On or before May 1, 2004, the Board shall recalculate and recertify to the Governor the amount of the required State contribution to the System for State fiscal year 2005, taking into account the amounts appropriated to and received by the System under subsection (d) of Section 7.2 of the General Obligation Bond Act.

On or before July 1, 2005, the Board shall recalculate and recertify to the Governor the amount of the required State contribution to the System for State fiscal year 2006, taking into account the changes in required State contributions made by this amendatory Act of the 94th General Assembly.

On or before April 1, 2011, the Board shall recalculate and recertify to the Governor the amount of the required State contribution to the System for State fiscal year 2011, applying the changes made by Public Act 96-889 to the System's assets and liabilities as of June 30, 2009 as though Public Act 96-889 was approved on that date.

By November 1, 2017, the Board shall recalculate and recertify to the State Actuary, the Governor, and the General Assembly the amount of the State contribution to the System for State fiscal year 2018, taking into account the changes in required State contributions made by this amendatory Act of the 100th General Assembly. The State Actuary shall review the assumptions and valuations underlying the Board's revised certification and issue a preliminary report concerning the proposed recertification and identifying, if necessary, recommended changes in actuarial assumptions that the Board must consider before finalizing its certification of the required State contributions. The Board's final certification must note any deviations from the State Actuary's recommended changes, the reason or reasons for not following the State Actuary's recommended changes, and the fiscal impact of not following the State Actuary's recommended changes on the required State contribution.

On or before May 1, 2021, the Board shall recalculate and recertify to the Governor and the General Assembly the amount of the required State contribution to the System for State fiscal year 2022, taking into account the effect on the System's liabilities of the elections made under Section 2-110.3.

On or before October 1, 2021, the Board shall recalculate and recertify to the Governor and the General Assembly the amount of the required State contribution to the System for State fiscal year 2022, taking into account the reduction specified under item (3) of subsection (c) of Section 2-124.

(b) Beginning in State fiscal year 1996, on or as soon as possible after the 15th day of each month the Board shall submit vouchers for payment of State contributions to the System, in a total monthly amount of one-twelfth of the required annual State contribution certified under subsection (a). From the effective date of this amendatory Act of the 93rd General Assembly through June 30, 2004, the Board shall not submit vouchers for the remainder of fiscal year 2004 in excess of the fiscal year 2004 certified contribution amount determined under this Section after taking into consideration the transfer to the System under subsection (d) of Section 6z-61 of the State Finance Act. These vouchers shall be paid by the State Comptroller and Treasurer by warrants drawn on the funds appropriated to the System for that fiscal year. If in any month the amount remaining unexpended from all other appropriations to the System for the applicable fiscal year (including the appropriations to the System under Section 8.12 of the State Finance Act and Section 1 of the State Pension Funds Continuing Appropriation Act) is less than the amount lawfully vouchered under this Section, the difference shall be paid from the General Revenue Fund under the continuing appropriation authority provided in Section 1.1 of the State Pension Funds Continuing Appropriation Act.

(c) The full amount of any annual appropriation for the System for State fiscal year 1995 shall be transferred and made available to the System at the beginning of that fiscal year at the request of the Board. Any excess funds remaining at the end of any fiscal year from appropriations shall be retained by the System as a general reserve to meet the System's accrued liabilities.

(Source: P.A. 100-23, eff. 7-6-17.)

(40 ILCS 5/2-162)

(Text of Section WITHOUT the changes made by P.A. 98-599, which has been held unconstitutional)

Sec. 2-162. 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 the effective date of this amendatory Act of the 94th General Assembly. "New benefit increase", however, does not include any benefit increase resulting from the changes made to this Article by this amendatory Act of the 101st 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 Financial and Professional Regulation. 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 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. 94-4, eff. 6-1-05.)

Section 10. The State Pension Funds Continuing Appropriation Act is amended by adding Section 1.10 as follows:

(40 ILCS 15/1.10 new)

Sec. 1.10. Appropriation for consideration payment. There is hereby appropriated from the General Revenue Fund to the State Comptroller, on a continuing basis, all amounts necessary for the payment of consideration payments under subsection (b) of Section 2-110.3 of the Illinois Pension Code in the amounts certified to the State Comptroller by the General Assembly Retirement System.

Section 970. Severability. Except as otherwise provided in this Act, the provisions of this Act are severable under Section 1.31 of the Statute on Statutes.

Section 999. Effective date. This Act takes effect upon becoming law.