94TH GENERAL ASSEMBLY
State of Illinois
2005 and 2006
SB2507


 
Introduced 1/18/2006, by Sen. Iris Y. Martinez
 
SYNOPSIS AS INTRODUCED:
 		













40 ILCS 5/17-127
  from Ch. 108 1/2, par. 17-127




40 ILCS 5/17-129
  from Ch. 108 1/2, par. 17-129









    Amends the Chicago Teacher Article of the Illinois Pension Code. Provides for mandatory State contributions to the Chicago Teacher Pension Fund. Provides that, if the State does not make the required contribution, then the Board of Education shall meet the minimum funding requirement. Effective immediately.
















LRB094 15711 AMC 50921 b

















FISCAL NOTE ACT MAY APPLY


PENSION IMPACT NOTE ACT MAY APPLY


STATE MANDATES ACT MAY REQUIRE REIMBURSEMENT
















 


 


A BILL FOR









 











SB2507

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    AN ACT concerning public employee benefits.

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

 
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    Section 5. The Illinois Pension Code is amended by changing 
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Sections
17-127 and 17-129 as follows:


 
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    (40 ILCS 5/17-127)  (from Ch. 108 1/2, par. 17-127)

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    Sec. 17-127. Financing; revenues for the Fund.


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    (a) The revenues for the Fund shall consist of: (1) amounts 
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paid into
the Fund by contributors thereto and from employer 
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contributions and State
appropriations in accordance with this 
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Article; (2) amounts contributed to the
Fund by an Employer; 
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(3) amounts contributed to the Fund pursuant to any law
now in 
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force or hereafter to be enacted; (4) contributions from any 
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other
source; and (5) the earnings on investments of the Fund.


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    (b) The General Assembly finds that for many years the 
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State has
contributed to the Fund an annual amount that is 
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between 20% and 30% of the
amount of the annual State 
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contribution to the Article 16 retirement system,
and the 
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General Assembly declares that it is its goal and intention to 
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continue
this level of contribution to the Fund in the future.


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    (b-5)
Beginning In State fiscal years
year 1999 through

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2006, the State shall include
in its annual contribution to the 
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Fund an additional amount equal to 0.544% of
the Fund's total 
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teacher payroll; except that this additional contribution need

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not be made in a fiscal year if the Board has certified in the 
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previous
fiscal year that the Fund is at least 90% funded, 
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based on actuarial
determinations.  These additional State 
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contributions are intended to offset
a portion of the cost to 
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the Fund of the increases in retirement benefits
resulting from 
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Public Act 90-582
this amendatory Act of 1998.


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    (c) For each State fiscal year ending after calendar year 
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2006, the
State shall contribute to the Fund, by means of 
 


 






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appropriations from the Common
School Fund or other State 
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funds, an amount not less than the greater of (i)
the amount 
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appropriated for the Fund for the State fiscal year ending in

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calendar year 2005 or (ii) the minimum funding requirement, as 
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defined below,
for that fiscal year (calculated without regard 
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to any contribution of the
State to or for the benefit of the 
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Fund under this subsection (c)).

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    (d) Beginning in the State fiscal year ending in 2007, on 
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the 15th day of
each month, or as soon after that date as is 
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practicable, the Board shall
submit vouchers for payment of 
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State contributions to the Fund, in a monthly
amount of 
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one-twelfth of the required annual State contribution under

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subsection (c) of this Section.  If that required annual 
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contribution changes
during the State fiscal year, the 
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remaining monthly amounts shall be adjusted
in equal amounts so 
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that the total amount for which vouchers are submitted for
the 
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year equals that
required annual contribution.  These vouchers 
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shall be paid by the State
Comptroller and Treasurer by 
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warrants drawn on the funds appropriated to the
Fund for that 
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fiscal year.  If, in any month, the amount remaining unexpended

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from all other State appropriations to the Fund for that State 
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fiscal year is
less than the amount for which vouchers are 
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lawfully submitted under this
Section, the difference shall be 
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paid under the continuing appropriation
available for that 
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purpose pursuant to the Chicago Teacher Pension Fund
Continuing 
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Appropriation Act.

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    (e) If the State does not make the contribution required by 
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subsections (c) and (d), then the Board of Education shall meet 
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the minimum funding requirement, as defined in subsection (f).

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    (f) For the purposes of this Section, "minimum funding 
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requirement"
for any fiscal year means the minimum Board of 
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Education contribution to the
Fund under Section  17-129 
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(calculated without regard to
any contribution of the State to 
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or for the benefit of the Fund).


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    (g) The changes made to this Section or Section 17-129 by 
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this amendatory Act of the 94th General Assembly  shall not be 
 


 






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construed, interpreted, or otherwise viewed to imply an 
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authorization, desire, or intent to merge or in any other way 
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combine the Public School Teachers' Pension and Retirement Fund 
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of Chicago with any other pension fund.

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(Source: P.A. 90-548, eff. 12-4-97; 90-566, eff. 1-2-98; 
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90-582, eff.
5-27-98; 90-655, eff. 7-30-98.)

 
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    (40 ILCS 5/17-129)  (from Ch. 108 1/2, par. 17-129)

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    Sec. 17-129. Employer contributions; deficiency in Fund.


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    (a) If in any fiscal year of the Board of Education ending 
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prior to 1997 the
total amounts paid to the Fund from the Board 
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of Education (other than under
this subsection, and other than 
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amounts used for making or "picking up"
contributions on behalf 
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of teachers) and from the State do not equal the total

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contributions made by or on behalf of the teachers for such 
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year, or if the
total income of the Fund in any such fiscal 
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year of the Board of Education from
all sources is less than 
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the total such expenditures by the Fund for such year,
the 
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Board of Education shall, in the next succeeding year, in 
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addition to any
other payment to the Fund set apart and 
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appropriate from moneys from its tax
levy for educational 
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purposes, a sum sufficient to remove such deficiency or

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deficiencies, and promptly pay such sum into the Fund in order 
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to restore any
of the reserves of the Fund that may have been 
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so temporarily applied.  Any
amounts received by the Fund after 
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December 4, 1997 from State appropriations, including under 
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Section
17-127, shall be a credit against and shall fully 
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satisfy any obligation that
may have arisen, or be claimed to 
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have arisen, under this subsection (a) as a
result of any 
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deficiency or deficiencies in the fiscal year of the Board of

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Education ending in calendar year 1997.


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    (b) (i) For fiscal years 2011 through 2045, the minimum 
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contribution
to the Fund to be made by the Board of Education 
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in each fiscal year shall be
an amount determined by the Fund 
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to be sufficient, taking into account
payments
made and to be 
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made under Section 17-127.2, to bring the total assets of
the 
 


 






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Fund up to 90% of the total actuarial liabilities of the Fund 
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by the end of
fiscal year 2045.  In making these determinations, 
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the required Board of
Education contribution shall be 
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calculated each year as a level percentage of
the applicable 
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employee payrolls over the years remaining to and including

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fiscal year 2045 and shall
be determined under the projected 
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unit credit actuarial cost method.


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    (ii) For fiscal years 1999 through 2010, the Board of 
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Education's
contribution to the Fund, as a percentage of the 
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applicable employee payroll,
shall be increased in equal annual 
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increments so that by fiscal year 2011, the
Board of Education 
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is contributing at the rate required under this subsection.


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    (iii) Beginning in fiscal year 2046, the minimum Board of 
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Education
contribution for each fiscal year shall be the amount 
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needed to maintain the
total assets of the Fund at 90% of the 
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total actuarial liabilities of the Fund.


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    (iv) Notwithstanding the provisions of paragraphs (i), 
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(ii), and (iii)
of this subsection (b) or Section 17-127.2, for 
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any fiscal year the
contribution to the Fund from
the Board of 
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Education shall not be required to be in excess of the amount

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calculated as needed to maintain the assets (or cause the 
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assets to be) at the
90% level by the end of the fiscal year.


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    (v) Any contribution by the State to or for the benefit of 
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the Fund
in a fiscal year, including, without limitation, any 
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contribution
as
referred to under Section 17-127, shall be a 
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credit against any contribution
required to be made by the 
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Board of Education under this subsection (b).


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    (c) The Board shall determine the amount of Board of 
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Education
contributions required for each fiscal year on the 
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basis of the actuarial
tables and other assumptions adopted by 
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the Board and the recommendations of
the actuary, in order to 
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meet the minimum contribution requirements of
subsections (a) 
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and (b).  Annually, on or before February 28, the Board shall

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certify to the Board of Education the amount of the required 
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Board of Education
contribution for the coming fiscal year.  The 
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certification shall include a
copy of the actuarial 
 


 






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recommendations upon which it is based.


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(Source: P.A. 89-15, eff. 5-30-95; 90-548, eff. 12-4-97; 
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90-566, eff. 1-2-98;
90-655, eff. 7-30-98.)


 
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    Section 99. Effective date. This Act takes effect upon 
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becoming law.