Illinois General Assembly - Full Text of SB1646
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Full Text of SB1646  102nd General Assembly

SB1646enr 102ND GENERAL ASSEMBLY



 


 
SB1646 EnrolledLRB102 15392 RPS 20755 b

1    AN ACT concerning public employee benefits.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Illinois Pension Code is amended by
5changing Sections 16-127 and 16-158 as follows:
 
6    (40 ILCS 5/16-127)  (from Ch. 108 1/2, par. 16-127)
7    Sec. 16-127. Computation of creditable service.
8    (a) Each member shall receive regular credit for all
9service as a teacher from the date membership begins, for
10which satisfactory evidence is supplied and all contributions
11have been paid.
12    (b) The following periods of service shall earn optional
13credit and each member shall receive credit for all such
14service for which satisfactory evidence is supplied and all
15contributions have been paid as of the date specified:
16        (1) Prior service as a teacher.
17        (2) Service in a capacity essentially similar or
18    equivalent to that of a teacher, in the public common
19    schools in school districts in this State not included
20    within the provisions of this System, or of any other
21    State, territory, dependency or possession of the United
22    States, or in schools operated by or under the auspices of
23    the United States, or under the auspices of any agency or

 

 

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1    department of any other State, and service during any
2    period of professional speech correction or special
3    education experience for a public agency within this State
4    or any other State, territory, dependency or possession of
5    the United States, and service prior to February 1, 1951
6    as a recreation worker for the Illinois Department of
7    Public Safety, for a period not exceeding the lesser of
8    2/5 of the total creditable service of the member or 10
9    years. The maximum service of 10 years which is allowable
10    under this paragraph shall be reduced by the service
11    credit which is validated by other retirement systems
12    under paragraph (i) of Section 15-113 and paragraph 1 of
13    Section 17-133. Credit granted under this paragraph may
14    not be used in determination of a retirement annuity or
15    disability benefits unless the member has at least 5 years
16    of creditable service earned subsequent to this employment
17    with one or more of the following systems: Teachers'
18    Retirement System of the State of Illinois, State
19    Universities Retirement System, and the Public School
20    Teachers' Pension and Retirement Fund of Chicago. Whenever
21    such service credit exceeds the maximum allowed for all
22    purposes of this Article, the first service rendered in
23    point of time shall be considered. The changes to this
24    subdivision (b)(2) made by Public Act 86-272 shall apply
25    not only to persons who on or after its effective date
26    (August 23, 1989) are in service as a teacher under the

 

 

SB1646 Enrolled- 3 -LRB102 15392 RPS 20755 b

1    System, but also to persons whose status as such a teacher
2    terminated prior to such effective date, whether or not
3    such person is an annuitant on that date.
4        (3) Any periods immediately following teaching
5    service, under this System or under Article 17, (or
6    immediately following service prior to February 1, 1951 as
7    a recreation worker for the Illinois Department of Public
8    Safety) spent in active service with the military forces
9    of the United States; periods spent in educational
10    programs that prepare for return to teaching sponsored by
11    the federal government following such active military
12    service; if a teacher returns to teaching service within
13    one calendar year after discharge or after the completion
14    of the educational program, a further period, not
15    exceeding one calendar year, between time spent in
16    military service or in such educational programs and the
17    return to employment as a teacher under this System; and a
18    period of up to 2 years of active military service not
19    immediately following employment as a teacher.
20        The changes to this Section and Section 16-128
21    relating to military service made by P.A. 87-794 shall
22    apply not only to persons who on or after its effective
23    date are in service as a teacher under the System, but also
24    to persons whose status as a teacher terminated prior to
25    that date, whether or not the person is an annuitant on
26    that date. In the case of an annuitant who applies for

 

 

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1    credit allowable under this Section for a period of
2    military service that did not immediately follow
3    employment, and who has made the required contributions
4    for such credit, the annuity shall be recalculated to
5    include the additional service credit, with the increase
6    taking effect on the date the System received written
7    notification of the annuitant's intent to purchase the
8    credit, if payment of all the required contributions is
9    made within 60 days of such notice, or else on the first
10    annuity payment date following the date of payment of the
11    required contributions. In calculating the automatic
12    annual increase for an annuity that has been recalculated
13    under this Section, the increase attributable to the
14    additional service allowable under P.A. 87-794 shall be
15    included in the calculation of automatic annual increases
16    accruing after the effective date of the recalculation.
17        Credit for military service shall be determined as
18    follows: if entry occurs during the months of July,
19    August, or September and the member was a teacher at the
20    end of the immediately preceding school term, credit shall
21    be granted from July 1 of the year in which he or she
22    entered service; if entry occurs during the school term
23    and the teacher was in teaching service at the beginning
24    of the school term, credit shall be granted from July 1 of
25    such year. In all other cases where credit for military
26    service is allowed, credit shall be granted from the date

 

 

SB1646 Enrolled- 5 -LRB102 15392 RPS 20755 b

1    of entry into the service.
2        The total period of military service for which credit
3    is granted shall not exceed 5 years for any member unless
4    the service: (A) is validated before July 1, 1964, and (B)
5    does not extend beyond July 1, 1963. Credit for military
6    service shall be granted under this Section only if not
7    more than 5 years of the military service for which credit
8    is granted under this Section is used by the member to
9    qualify for a military retirement allotment from any
10    branch of the armed forces of the United States. The
11    changes to this subdivision (b)(3) made by Public Act
12    86-272 shall apply not only to persons who on or after its
13    effective date (August 23, 1989) are in service as a
14    teacher under the System, but also to persons whose status
15    as such a teacher terminated prior to such effective date,
16    whether or not such person is an annuitant on that date.
17        (4) Any periods served as a member of the General
18    Assembly.
19        (5)(i) Any periods for which a teacher, as defined in
20    Section 16-106, is granted a leave of absence, provided he
21    or she returns to teaching service creditable under this
22    System or the State Universities Retirement System
23    following the leave; (ii) periods during which a teacher
24    is involuntarily laid off from teaching, provided he or
25    she returns to teaching following the lay-off; (iii)
26    periods prior to July 1, 1983 during which a teacher

 

 

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1    ceased covered employment due to pregnancy, provided that
2    the teacher returned to teaching service creditable under
3    this System or the State Universities Retirement System
4    following the pregnancy and submits evidence satisfactory
5    to the Board documenting that the employment ceased due to
6    pregnancy; and (iv) periods prior to July 1, 1983 during
7    which a teacher ceased covered employment for the purpose
8    of adopting an infant under 3 years of age or caring for a
9    newly adopted infant under 3 years of age, provided that
10    the teacher returned to teaching service creditable under
11    this System or the State Universities Retirement System
12    following the adoption and submits evidence satisfactory
13    to the Board documenting that the employment ceased for
14    the purpose of adopting an infant under 3 years of age or
15    caring for a newly adopted infant under 3 years of age.
16    However, total credit under this paragraph (5) may not
17    exceed 3 years.
18        Any qualified member or annuitant may apply for credit
19    under item (iii) or (iv) of this paragraph (5) without
20    regard to whether service was terminated before the
21    effective date of this amendatory Act of 1997. In the case
22    of an annuitant who establishes credit under item (iii) or
23    (iv), the annuity shall be recalculated to include the
24    additional service credit. The increase in annuity shall
25    take effect on the date the System receives written
26    notification of the annuitant's intent to purchase the

 

 

SB1646 Enrolled- 7 -LRB102 15392 RPS 20755 b

1    credit, if the required evidence is submitted and the
2    required contribution paid within 60 days of that
3    notification, otherwise on the first annuity payment date
4    following the System's receipt of the required evidence
5    and contribution. The increase in an annuity recalculated
6    under this provision shall be included in the calculation
7    of automatic annual increases in the annuity accruing
8    after the effective date of the recalculation.
9        Optional credit may be purchased under this subsection
10    (b)(5) for periods during which a teacher has been granted
11    a leave of absence pursuant to Section 24-13 of the School
12    Code. A teacher whose service under this Article
13    terminated prior to the effective date of P.A. 86-1488
14    shall be eligible to purchase such optional credit. If a
15    teacher who purchases this optional credit is already
16    receiving a retirement annuity under this Article, the
17    annuity shall be recalculated as if the annuitant had
18    applied for the leave of absence credit at the time of
19    retirement. The difference between the entitled annuity
20    and the actual annuity shall be credited to the purchase
21    of the optional credit. The remainder of the purchase cost
22    of the optional credit shall be paid on or before April 1,
23    1992.
24        The change in this paragraph made by Public Act 86-273
25    shall be applicable to teachers who retire after June 1,
26    1989, as well as to teachers who are in service on that

 

 

SB1646 Enrolled- 8 -LRB102 15392 RPS 20755 b

1    date.
2        (6) Any days of unused and uncompensated accumulated
3    sick leave earned by a teacher. The service credit granted
4    under this paragraph shall be the ratio of the number of
5    unused and uncompensated accumulated sick leave days to
6    170 days, subject to a maximum of 2 years of service
7    credit. Prior to the member's retirement, each former
8    employer shall certify to the System the number of unused
9    and uncompensated accumulated sick leave days credited to
10    the member at the time of termination of service. The
11    period of unused sick leave shall not be considered in
12    determining the effective date of retirement. A member is
13    not required to make contributions in order to obtain
14    service credit for unused sick leave.
15        Credit for sick leave shall, at retirement, be granted
16    by the System for any retiring regional or assistant
17    regional superintendent of schools at the rate of 6 days
18    per year of creditable service or portion thereof
19    established while serving as such superintendent or
20    assistant superintendent.
21        (7) Periods prior to February 1, 1987 served as an
22    employee of the Illinois Mathematics and Science Academy
23    for which credit has not been terminated under Section
24    15-113.9 of this Code.
25        (8) Service as a substitute teacher for work performed
26    prior to July 1, 1990.

 

 

SB1646 Enrolled- 9 -LRB102 15392 RPS 20755 b

1        (9) Service as a part-time teacher for work performed
2    prior to July 1, 1990.
3        (10) Up to 2 years of employment with Southern
4    Illinois University - Carbondale from September 1, 1959 to
5    August 31, 1961, or with Governors State University from
6    September 1, 1972 to August 31, 1974, for which the
7    teacher has no credit under Article 15. To receive credit
8    under this item (10), a teacher must apply in writing to
9    the Board and pay the required contributions before May 1,
10    1993 and have at least 12 years of service credit under
11    this Article.
12    (b-1) A member may establish optional credit for up to 2
13years of service as a teacher or administrator employed by a
14private school recognized by the Illinois State Board of
15Education, provided that the teacher (i) was certified under
16the law governing the certification of teachers at the time
17the service was rendered, (ii) applies in writing on or before
18June 30, 2023 on or after August 1, 2009 and on or before
19August 1, 2012, (iii) supplies satisfactory evidence of the
20employment, (iv) completes at least 10 years of contributing
21service as a teacher as defined in Section 16-106, and (v) pays
22the contribution required in subsection (d-5) of Section
2316-128. The member may apply for credit under this subsection
24and pay the required contribution before completing the 10
25years of contributing service required under item (iv), but
26the credit may not be used until the item (iv) contributing

 

 

SB1646 Enrolled- 10 -LRB102 15392 RPS 20755 b

1service requirement has been met.
2    (c) The service credits specified in this Section shall be
3granted only if: (1) such service credits are not used for
4credit in any other statutory tax-supported public employee
5retirement system other than the federal Social Security
6program; and (2) the member makes the required contributions
7as specified in Section 16-128. Except as provided in
8subsection (b-1) of this Section, the service credit shall be
9effective as of the date the required contributions are
10completed.
11    Any service credits granted under this Section shall
12terminate upon cessation of membership for any cause.
13    Credit may not be granted under this Section covering any
14period for which an age retirement or disability retirement
15allowance has been paid.
16    Credit may not be granted under this Section for service
17as an employee of an entity that provides substitute teaching
18services under Section 2-3.173 of the School Code and is not a
19school district.
20(Source: P.A. 100-813, eff. 8-13-18.)
 
21    (40 ILCS 5/16-158)   (from Ch. 108 1/2, par. 16-158)
22    Sec. 16-158. Contributions by State and other employing
23units.
24    (a) The State shall make contributions to the System by
25means of appropriations from the Common School Fund and other

 

 

SB1646 Enrolled- 11 -LRB102 15392 RPS 20755 b

1State funds of amounts which, together with other employer
2contributions, employee contributions, investment income, and
3other income, will be sufficient to meet the cost of
4maintaining and administering the System on a 90% funded basis
5in accordance with actuarial recommendations.
6    The Board shall determine the amount of State
7contributions required for each fiscal year on the basis of
8the actuarial tables and other assumptions adopted by the
9Board and the recommendations of the actuary, using the
10formula in subsection (b-3).
11    (a-1) Annually, on or before November 15 until November
1215, 2011, the Board shall certify to the Governor the amount of
13the required State contribution for the coming fiscal year.
14The certification under this subsection (a-1) shall include a
15copy of the actuarial recommendations upon which it is based
16and shall specifically identify the System's projected State
17normal cost for that fiscal year.
18    On or before May 1, 2004, the Board shall recalculate and
19recertify to the Governor the amount of the required State
20contribution to the System for State fiscal year 2005, taking
21into account the amounts appropriated to and received by the
22System under subsection (d) of Section 7.2 of the General
23Obligation Bond Act.
24    On or before July 1, 2005, the Board shall recalculate and
25recertify to the Governor the amount of the required State
26contribution to the System for State fiscal year 2006, taking

 

 

SB1646 Enrolled- 12 -LRB102 15392 RPS 20755 b

1into account the changes in required State contributions made
2by Public Act 94-4.
3    On or before April 1, 2011, the Board shall recalculate
4and recertify to the Governor the amount of the required State
5contribution to the System for State fiscal year 2011,
6applying the changes made by Public Act 96-889 to the System's
7assets and liabilities as of June 30, 2009 as though Public Act
896-889 was approved on that date.
9    (a-5) On or before November 1 of each year, beginning
10November 1, 2012, the Board shall submit to the State Actuary,
11the Governor, and the General Assembly a proposed
12certification of the amount of the required State contribution
13to the System for the next fiscal year, along with all of the
14actuarial assumptions, calculations, and data upon which that
15proposed certification is based. On or before January 1 of
16each year, beginning January 1, 2013, the State Actuary shall
17issue a preliminary report concerning the proposed
18certification and identifying, if necessary, recommended
19changes in actuarial assumptions that the Board must consider
20before finalizing its certification of the required State
21contributions. On or before January 15, 2013 and each January
2215 thereafter, the Board shall certify to the Governor and the
23General Assembly the amount of the required State contribution
24for the next fiscal year. The Board's certification must note
25any deviations from the State Actuary's recommended changes,
26the reason or reasons for not following the State Actuary's

 

 

SB1646 Enrolled- 13 -LRB102 15392 RPS 20755 b

1recommended changes, and the fiscal impact of not following
2the State Actuary's recommended changes on the required State
3contribution.
4    (a-10) By November 1, 2017, the Board shall recalculate
5and recertify to the State Actuary, the Governor, and the
6General Assembly the amount of the State contribution to the
7System for State fiscal year 2018, taking into account the
8changes in required State contributions made by Public Act
9100-23. The State Actuary shall review the assumptions and
10valuations underlying the Board's revised certification and
11issue a preliminary report concerning the proposed
12recertification and identifying, if necessary, recommended
13changes in actuarial assumptions that the Board must consider
14before finalizing its certification of the required State
15contributions. The Board's final certification must note any
16deviations from the State Actuary's recommended changes, the
17reason or reasons for not following the State Actuary's
18recommended changes, and the fiscal impact of not following
19the State Actuary's recommended changes on the required State
20contribution.
21    (a-15) On or after June 15, 2019, but no later than June
2230, 2019, the Board shall recalculate and recertify to the
23Governor and the General Assembly the amount of the State
24contribution to the System for State fiscal year 2019, taking
25into account the changes in required State contributions made
26by Public Act 100-587. The recalculation shall be made using

 

 

SB1646 Enrolled- 14 -LRB102 15392 RPS 20755 b

1assumptions adopted by the Board for the original fiscal year
22019 certification. The monthly voucher for the 12th month of
3fiscal year 2019 shall be paid by the Comptroller after the
4recertification required pursuant to this subsection is
5submitted to the Governor, Comptroller, and General Assembly.
6The recertification submitted to the General Assembly shall be
7filed with the Clerk of the House of Representatives and the
8Secretary of the Senate in electronic form only, in the manner
9that the Clerk and the Secretary shall direct.
10    (b) Through State fiscal year 1995, the State
11contributions shall be paid to the System in accordance with
12Section 18-7 of the School Code.
13    (b-1) Beginning in State fiscal year 1996, on the 15th day
14of each month, or as soon thereafter as may be practicable, the
15Board shall submit vouchers for payment of State contributions
16to the System, in a total monthly amount of one-twelfth of the
17required annual State contribution certified under subsection
18(a-1). From March 5, 2004 (the effective date of Public Act
1993-665) through June 30, 2004, the Board shall not submit
20vouchers for the remainder of fiscal year 2004 in excess of the
21fiscal year 2004 certified contribution amount determined
22under this Section after taking into consideration the
23transfer to the System under subsection (a) of Section 6z-61
24of the State Finance Act. These vouchers shall be paid by the
25State Comptroller and Treasurer by warrants drawn on the funds
26appropriated to the System for that fiscal year.

 

 

SB1646 Enrolled- 15 -LRB102 15392 RPS 20755 b

1    If in any month the amount remaining unexpended from all
2other appropriations to the System for the applicable fiscal
3year (including the appropriations to the System under Section
48.12 of the State Finance Act and Section 1 of the State
5Pension Funds Continuing Appropriation Act) is less than the
6amount lawfully vouchered under this subsection, the
7difference shall be paid from the Common School Fund under the
8continuing appropriation authority provided in Section 1.1 of
9the State Pension Funds Continuing Appropriation Act.
10    (b-2) Allocations from the Common School Fund apportioned
11to school districts not coming under this System shall not be
12diminished or affected by the provisions of this Article.
13    (b-3) For State fiscal years 2012 through 2045, the
14minimum contribution to the System to be made by the State for
15each fiscal year shall be an amount determined by the System to
16be sufficient to bring the total assets of the System up to 90%
17of the total actuarial liabilities of the System by the end of
18State fiscal year 2045. In making these determinations, the
19required State contribution shall be calculated each year as a
20level percentage of payroll over the years remaining to and
21including fiscal year 2045 and shall be determined under the
22projected unit credit actuarial cost method.
23    For each of State fiscal years 2018, 2019, and 2020, the
24State shall make an additional contribution to the System
25equal to 2% of the total payroll of each employee who is deemed
26to have elected the benefits under Section 1-161 or who has

 

 

SB1646 Enrolled- 16 -LRB102 15392 RPS 20755 b

1made the election under subsection (c) of Section 1-161.
2    A change in an actuarial or investment assumption that
3increases or decreases the required State contribution and
4first applies in State fiscal year 2018 or thereafter shall be
5implemented in equal annual amounts over a 5-year period
6beginning in the State fiscal year in which the actuarial
7change first applies to the required State contribution.
8    A change in an actuarial or investment assumption that
9increases or decreases the required State contribution and
10first applied to the State contribution in fiscal year 2014,
112015, 2016, or 2017 shall be implemented:
12        (i) as already applied in State fiscal years before
13    2018; and
14        (ii) in the portion of the 5-year period beginning in
15    the State fiscal year in which the actuarial change first
16    applied that occurs in State fiscal year 2018 or
17    thereafter, by calculating the change in equal annual
18    amounts over that 5-year period and then implementing it
19    at the resulting annual rate in each of the remaining
20    fiscal years in that 5-year period.
21    For State fiscal years 1996 through 2005, the State
22contribution to the System, as a percentage of the applicable
23employee payroll, shall be increased in equal annual
24increments so that by State fiscal year 2011, the State is
25contributing at the rate required under this Section; except
26that in the following specified State fiscal years, the State

 

 

SB1646 Enrolled- 17 -LRB102 15392 RPS 20755 b

1contribution to the System shall not be less than the
2following indicated percentages of the applicable employee
3payroll, even if the indicated percentage will produce a State
4contribution in excess of the amount otherwise required under
5this subsection and subsection (a), and notwithstanding any
6contrary certification made under subsection (a-1) before May
727, 1998 (the effective date of Public Act 90-582): 10.02% in
8FY 1999; 10.77% in FY 2000; 11.47% in FY 2001; 12.16% in FY
92002; 12.86% in FY 2003; and 13.56% in FY 2004.
10    Notwithstanding any other provision of this Article, the
11total required State contribution for State fiscal year 2006
12is $534,627,700.
13    Notwithstanding any other provision of this Article, the
14total required State contribution for State fiscal year 2007
15is $738,014,500.
16    For each of State fiscal years 2008 through 2009, the
17State contribution to the System, as a percentage of the
18applicable employee payroll, shall be increased in equal
19annual increments from the required State contribution for
20State fiscal year 2007, so that by State fiscal year 2011, the
21State is contributing at the rate otherwise required under
22this Section.
23    Notwithstanding any other provision of this Article, the
24total required State contribution for State fiscal year 2010
25is $2,089,268,000 and shall be made from the proceeds of bonds
26sold in fiscal year 2010 pursuant to Section 7.2 of the General

 

 

SB1646 Enrolled- 18 -LRB102 15392 RPS 20755 b

1Obligation Bond Act, less (i) the pro rata share of bond sale
2expenses determined by the System's share of total bond
3proceeds, (ii) any amounts received from the Common School
4Fund in fiscal year 2010, and (iii) any reduction in bond
5proceeds due to the issuance of discounted bonds, if
6applicable.
7    Notwithstanding any other provision of this Article, the
8total required State contribution for State fiscal year 2011
9is the amount recertified by the System on or before April 1,
102011 pursuant to subsection (a-1) of this Section and shall be
11made from the proceeds of bonds sold in fiscal year 2011
12pursuant to Section 7.2 of the General Obligation Bond Act,
13less (i) the pro rata share of bond sale expenses determined by
14the System's share of total bond proceeds, (ii) any amounts
15received from the Common School Fund in fiscal year 2011, and
16(iii) any reduction in bond proceeds due to the issuance of
17discounted bonds, if applicable. This amount shall include, in
18addition to the amount certified by the System, an amount
19necessary to meet employer contributions required by the State
20as an employer under paragraph (e) of this Section, which may
21also be used by the System for contributions required by
22paragraph (a) of Section 16-127.
23    Beginning in State fiscal year 2046, the minimum State
24contribution for each fiscal year shall be the amount needed
25to maintain the total assets of the System at 90% of the total
26actuarial liabilities of the System.

 

 

SB1646 Enrolled- 19 -LRB102 15392 RPS 20755 b

1    Amounts received by the System pursuant to Section 25 of
2the Budget Stabilization Act or Section 8.12 of the State
3Finance Act in any fiscal year do not reduce and do not
4constitute payment of any portion of the minimum State
5contribution required under this Article in that fiscal year.
6Such amounts shall not reduce, and shall not be included in the
7calculation of, the required State contributions under this
8Article in any future year until the System has reached a
9funding ratio of at least 90%. A reference in this Article to
10the "required State contribution" or any substantially similar
11term does not include or apply to any amounts payable to the
12System under Section 25 of the Budget Stabilization Act.
13    Notwithstanding any other provision of this Section, the
14required State contribution for State fiscal year 2005 and for
15fiscal year 2008 and each fiscal year thereafter, as
16calculated under this Section and certified under subsection
17(a-1), shall not exceed an amount equal to (i) the amount of
18the required State contribution that would have been
19calculated under this Section for that fiscal year if the
20System had not received any payments under subsection (d) of
21Section 7.2 of the General Obligation Bond Act, minus (ii) the
22portion of the State's total debt service payments for that
23fiscal year on the bonds issued in fiscal year 2003 for the
24purposes of that Section 7.2, as determined and certified by
25the Comptroller, that is the same as the System's portion of
26the total moneys distributed under subsection (d) of Section

 

 

SB1646 Enrolled- 20 -LRB102 15392 RPS 20755 b

17.2 of the General Obligation Bond Act. In determining this
2maximum for State fiscal years 2008 through 2010, however, the
3amount referred to in item (i) shall be increased, as a
4percentage of the applicable employee payroll, in equal
5increments calculated from the sum of the required State
6contribution for State fiscal year 2007 plus the applicable
7portion of the State's total debt service payments for fiscal
8year 2007 on the bonds issued in fiscal year 2003 for the
9purposes of Section 7.2 of the General Obligation Bond Act, so
10that, by State fiscal year 2011, the State is contributing at
11the rate otherwise required under this Section.
12    (b-4) Beginning in fiscal year 2018, each employer under
13this Article shall pay to the System a required contribution
14determined as a percentage of projected payroll and sufficient
15to produce an annual amount equal to:
16        (i) for each of fiscal years 2018, 2019, and 2020, the
17    defined benefit normal cost of the defined benefit plan,
18    less the employee contribution, for each employee of that
19    employer who has elected or who is deemed to have elected
20    the benefits under Section 1-161 or who has made the
21    election under subsection (b) of Section 1-161; for fiscal
22    year 2021 and each fiscal year thereafter, the defined
23    benefit normal cost of the defined benefit plan, less the
24    employee contribution, plus 2%, for each employee of that
25    employer who has elected or who is deemed to have elected
26    the benefits under Section 1-161 or who has made the

 

 

SB1646 Enrolled- 21 -LRB102 15392 RPS 20755 b

1    election under subsection (b) of Section 1-161; plus
2        (ii) the amount required for that fiscal year to
3    amortize any unfunded actuarial accrued liability
4    associated with the present value of liabilities
5    attributable to the employer's account under Section
6    16-158.3, determined as a level percentage of payroll over
7    a 30-year rolling amortization period.
8    In determining contributions required under item (i) of
9this subsection, the System shall determine an aggregate rate
10for all employers, expressed as a percentage of projected
11payroll.
12    In determining the contributions required under item (ii)
13of this subsection, the amount shall be computed by the System
14on the basis of the actuarial assumptions and tables used in
15the most recent actuarial valuation of the System that is
16available at the time of the computation.
17    The contributions required under this subsection (b-4)
18shall be paid by an employer concurrently with that employer's
19payroll payment period. The State, as the actual employer of
20an employee, shall make the required contributions under this
21subsection.
22    (c) Payment of the required State contributions and of all
23pensions, retirement annuities, death benefits, refunds, and
24other benefits granted under or assumed by this System, and
25all expenses in connection with the administration and
26operation thereof, are obligations of the State.

 

 

SB1646 Enrolled- 22 -LRB102 15392 RPS 20755 b

1    If members are paid from special trust or federal funds
2which are administered by the employing unit, whether school
3district or other unit, the employing unit shall pay to the
4System from such funds the full accruing retirement costs
5based upon that service, which, beginning July 1, 2017, shall
6be at a rate, expressed as a percentage of salary, equal to the
7total employer's normal cost, expressed as a percentage of
8payroll, as determined by the System. Employer contributions,
9based on salary paid to members from federal funds, may be
10forwarded by the distributing agency of the State of Illinois
11to the System prior to allocation, in an amount determined in
12accordance with guidelines established by such agency and the
13System. Any contribution for fiscal year 2015 collected as a
14result of the change made by Public Act 98-674 shall be
15considered a State contribution under subsection (b-3) of this
16Section.
17    (d) Effective July 1, 1986, any employer of a teacher as
18defined in paragraph (8) of Section 16-106 shall pay the
19employer's normal cost of benefits based upon the teacher's
20service, in addition to employee contributions, as determined
21by the System. Such employer contributions shall be forwarded
22monthly in accordance with guidelines established by the
23System.
24    However, with respect to benefits granted under Section
2516-133.4 or 16-133.5 to a teacher as defined in paragraph (8)
26of Section 16-106, the employer's contribution shall be 12%

 

 

SB1646 Enrolled- 23 -LRB102 15392 RPS 20755 b

1(rather than 20%) of the member's highest annual salary rate
2for each year of creditable service granted, and the employer
3shall also pay the required employee contribution on behalf of
4the teacher. For the purposes of Sections 16-133.4 and
516-133.5, a teacher as defined in paragraph (8) of Section
616-106 who is serving in that capacity while on leave of
7absence from another employer under this Article shall not be
8considered an employee of the employer from which the teacher
9is on leave.
10    (e) Beginning July 1, 1998, every employer of a teacher
11shall pay to the System an employer contribution computed as
12follows:
13        (1) Beginning July 1, 1998 through June 30, 1999, the
14    employer contribution shall be equal to 0.3% of each
15    teacher's salary.
16        (2) Beginning July 1, 1999 and thereafter, the
17    employer contribution shall be equal to 0.58% of each
18    teacher's salary.
19The school district or other employing unit may pay these
20employer contributions out of any source of funding available
21for that purpose and shall forward the contributions to the
22System on the schedule established for the payment of member
23contributions.
24    These employer contributions are intended to offset a
25portion of the cost to the System of the increases in
26retirement benefits resulting from Public Act 90-582.

 

 

SB1646 Enrolled- 24 -LRB102 15392 RPS 20755 b

1    Each employer of teachers is entitled to a credit against
2the contributions required under this subsection (e) with
3respect to salaries paid to teachers for the period January 1,
42002 through June 30, 2003, equal to the amount paid by that
5employer under subsection (a-5) of Section 6.6 of the State
6Employees Group Insurance Act of 1971 with respect to salaries
7paid to teachers for that period.
8    The additional 1% employee contribution required under
9Section 16-152 by Public Act 90-582 is the responsibility of
10the teacher and not the teacher's employer, unless the
11employer agrees, through collective bargaining or otherwise,
12to make the contribution on behalf of the teacher.
13    If an employer is required by a contract in effect on May
141, 1998 between the employer and an employee organization to
15pay, on behalf of all its full-time employees covered by this
16Article, all mandatory employee contributions required under
17this Article, then the employer shall be excused from paying
18the employer contribution required under this subsection (e)
19for the balance of the term of that contract. The employer and
20the employee organization shall jointly certify to the System
21the existence of the contractual requirement, in such form as
22the System may prescribe. This exclusion shall cease upon the
23termination, extension, or renewal of the contract at any time
24after May 1, 1998.
25    (f) If June 4, 2018 (Public Act 100-587) the amount of a
26teacher's salary for any school year used to determine final

 

 

SB1646 Enrolled- 25 -LRB102 15392 RPS 20755 b

1average salary exceeds the member's annual full-time salary
2rate with the same employer for the previous school year by
3more than 6%, the teacher's employer shall pay to the System,
4in addition to all other payments required under this Section
5and in accordance with guidelines established by the System,
6the present value of the increase in benefits resulting from
7the portion of the increase in salary that is in excess of 6%.
8This present value shall be computed by the System on the basis
9of the actuarial assumptions and tables used in the most
10recent actuarial valuation of the System that is available at
11the time of the computation. If a teacher's salary for the
122005-2006 school year is used to determine final average
13salary under this subsection (f), then the changes made to
14this subsection (f) by Public Act 94-1057 shall apply in
15calculating whether the increase in his or her salary is in
16excess of 6%. For the purposes of this Section, change in
17employment under Section 10-21.12 of the School Code on or
18after June 1, 2005 shall constitute a change in employer. The
19System may require the employer to provide any pertinent
20information or documentation. The changes made to this
21subsection (f) by Public Act 94-1111 apply without regard to
22whether the teacher was in service on or after its effective
23date.
24    Whenever it determines that a payment is or may be
25required under this subsection, the System shall calculate the
26amount of the payment and bill the employer for that amount.

 

 

SB1646 Enrolled- 26 -LRB102 15392 RPS 20755 b

1The bill shall specify the calculations used to determine the
2amount due. If the employer disputes the amount of the bill, it
3may, within 30 days after receipt of the bill, apply to the
4System in writing for a recalculation. The application must
5specify in detail the grounds of the dispute and, if the
6employer asserts that the calculation is subject to subsection
7(g), (g-5), or (h) of this Section, must include an affidavit
8setting forth and attesting to all facts within the employer's
9knowledge that are pertinent to the applicability of that
10subsection. Upon receiving a timely application for
11recalculation, the System shall review the application and, if
12appropriate, recalculate the amount due.
13    The employer contributions required under this subsection
14(f) may be paid in the form of a lump sum within 90 days after
15receipt of the bill. If the employer contributions are not
16paid within 90 days after receipt of the bill, then interest
17will be charged at a rate equal to the System's annual
18actuarially assumed rate of return on investment compounded
19annually from the 91st day after receipt of the bill. Payments
20must be concluded within 3 years after the employer's receipt
21of the bill.
22    (f-1) (Blank). June 4, 2018 (Public Act 100-587)
23    (g) This subsection (g) applies only to payments made or
24salary increases given on or after June 1, 2005 but before July
251, 2011. The changes made by Public Act 94-1057 shall not
26require the System to refund any payments received before July

 

 

SB1646 Enrolled- 27 -LRB102 15392 RPS 20755 b

131, 2006 (the effective date of Public Act 94-1057).
2    When assessing payment for any amount due under subsection
3(f), the System shall exclude salary increases paid to
4teachers under contracts or collective bargaining agreements
5entered into, amended, or renewed before June 1, 2005.
6    When assessing payment for any amount due under subsection
7(f), the System shall exclude salary increases paid to a
8teacher at a time when the teacher is 10 or more years from
9retirement eligibility under Section 16-132 or 16-133.2.
10    When assessing payment for any amount due under subsection
11(f), the System shall exclude salary increases resulting from
12overload work, including summer school, when the school
13district has certified to the System, and the System has
14approved the certification, that (i) the overload work is for
15the sole purpose of classroom instruction in excess of the
16standard number of classes for a full-time teacher in a school
17district during a school year and (ii) the salary increases
18are equal to or less than the rate of pay for classroom
19instruction computed on the teacher's current salary and work
20schedule.
21    When assessing payment for any amount due under subsection
22(f), the System shall exclude a salary increase resulting from
23a promotion (i) for which the employee is required to hold a
24certificate or supervisory endorsement issued by the State
25Teacher Certification Board that is a different certification
26or supervisory endorsement than is required for the teacher's

 

 

SB1646 Enrolled- 28 -LRB102 15392 RPS 20755 b

1previous position and (ii) to a position that has existed and
2been filled by a member for no less than one complete academic
3year and the salary increase from the promotion is an increase
4that results in an amount no greater than the lesser of the
5average salary paid for other similar positions in the
6district requiring the same certification or the amount
7stipulated in the collective bargaining agreement for a
8similar position requiring the same certification.
9    When assessing payment for any amount due under subsection
10(f), the System shall exclude any payment to the teacher from
11the State of Illinois or the State Board of Education over
12which the employer does not have discretion, notwithstanding
13that the payment is included in the computation of final
14average salary.
15    (g-5) When assessing payment for any amount due under
16subsection (f), the System shall exclude salary increases
17resulting from teaching summer school on or after May 1, 2021
18and before September 15, 2022.
19    (h) When assessing payment for any amount due under
20subsection (f), the System shall exclude any salary increase
21described in subsection (g) of this Section given on or after
22July 1, 2011 but before July 1, 2014 under a contract or
23collective bargaining agreement entered into, amended, or
24renewed on or after June 1, 2005 but before July 1, 2011.
25Notwithstanding any other provision of this Section, any
26payments made or salary increases given after June 30, 2014

 

 

SB1646 Enrolled- 29 -LRB102 15392 RPS 20755 b

1shall be used in assessing payment for any amount due under
2subsection (f) of this Section.
3    (i) The System shall prepare a report and file copies of
4the report with the Governor and the General Assembly by
5January 1, 2007 that contains all of the following
6information:
7        (1) The number of recalculations required by the
8    changes made to this Section by Public Act 94-1057 for
9    each employer.
10        (2) The dollar amount by which each employer's
11    contribution to the System was changed due to
12    recalculations required by Public Act 94-1057.
13        (3) The total amount the System received from each
14    employer as a result of the changes made to this Section by
15    Public Act 94-4.
16        (4) The increase in the required State contribution
17    resulting from the changes made to this Section by Public
18    Act 94-1057.
19    (i-5) For school years beginning on or after July 1, 2017,
20if the amount of a participant's salary for any school year
21exceeds the amount of the salary set for the Governor, the
22participant's employer shall pay to the System, in addition to
23all other payments required under this Section and in
24accordance with guidelines established by the System, an
25amount determined by the System to be equal to the employer
26normal cost, as established by the System and expressed as a

 

 

SB1646 Enrolled- 30 -LRB102 15392 RPS 20755 b

1total percentage of payroll, multiplied by the amount of
2salary in excess of the amount of the salary set for the
3Governor. This amount shall be computed by the System on the
4basis of the actuarial assumptions and tables used in the most
5recent actuarial valuation of the System that is available at
6the time of the computation. The System may require the
7employer to provide any pertinent information or
8documentation.
9    Whenever it determines that a payment is or may be
10required under this subsection, the System shall calculate the
11amount of the payment and bill the employer for that amount.
12The bill shall specify the calculations used to determine the
13amount due. If the employer disputes the amount of the bill, it
14may, within 30 days after receipt of the bill, apply to the
15System in writing for a recalculation. The application must
16specify in detail the grounds of the dispute. Upon receiving a
17timely application for recalculation, the System shall review
18the application and, if appropriate, recalculate the amount
19due.
20    The employer contributions required under this subsection
21may be paid in the form of a lump sum within 90 days after
22receipt of the bill. If the employer contributions are not
23paid within 90 days after receipt of the bill, then interest
24will be charged at a rate equal to the System's annual
25actuarially assumed rate of return on investment compounded
26annually from the 91st day after receipt of the bill. Payments

 

 

SB1646 Enrolled- 31 -LRB102 15392 RPS 20755 b

1must be concluded within 3 years after the employer's receipt
2of the bill.
3    (j) For purposes of determining the required State
4contribution to the System, the value of the System's assets
5shall be equal to the actuarial value of the System's assets,
6which shall be calculated as follows:
7    As of June 30, 2008, the actuarial value of the System's
8assets shall be equal to the market value of the assets as of
9that date. In determining the actuarial value of the System's
10assets for fiscal years after June 30, 2008, any actuarial
11gains or losses from investment return incurred in a fiscal
12year shall be recognized in equal annual amounts over the
135-year period following that fiscal year.
14    (k) For purposes of determining the required State
15contribution to the system for a particular year, the
16actuarial value of assets shall be assumed to earn a rate of
17return equal to the system's actuarially assumed rate of
18return.
19(Source: P.A. 100-23, eff. 7-6-17; 100-340, eff. 8-25-17;
20100-587, eff. 6-4-18; 100-624, eff. 7-20-18; 100-863, eff.
218-14-18; 101-10, eff. 6-5-19; 101-81, eff. 7-12-19; revised
228-13-19.)
 
23    Section 99. Effective date. This Act takes effect upon
24becoming law.