100TH GENERAL ASSEMBLY
State of Illinois
2017 and 2018
SB2517

 

Introduced 2/6/2018, by Sen. Dan McConchie

 

SYNOPSIS AS INTRODUCED:
 
40 ILCS 5/16-106.4a new
40 ILCS 5/16-106.4b new
40 ILCS 5/16-158  from Ch. 108 1/2, par. 16-158
30 ILCS 805/8.42 new

    Amends the Downstate Teacher Article of the Illinois Pension Code. Provides that beginning in fiscal year 2020 and each year thereafter, the System shall calculate the projected amount of the increase in the employer normal cost of benefits, expressed as a percentage of salary and reflecting separate amounts for Tier 1 and Tier 2 benefits, resulting from any increase in salary over the preceding school year, expressed as a percentage of salary. Provides that except for a teacher who first becomes a teacher on or after the implementation date of certain benefits, if the amount of a teacher's salary for any school year beginning on or after July 1, 2019 exceeds the member's annual full-time salary rate with the same employer for the previous school year, then the teacher's employer shall pay to the System the projected amount of the increase in the employer normal cost of benefits, as determined by the System and reflecting whether the teacher will receive Tier 1 or Tier 2 benefits, resulting from the increase in the member's salary over the previous school year. Excludes earnings increases paid to members under contracts or collective bargaining agreements entered into, amended, or renewed before the effective date of the amendatory Act. Excludes earning increases paid to members who first become members on or after the implementation date of certain benefits. Defines "Tier 1 benefits" and "Tier 2 benefits". Amends the State Mandates Act to require implementation without reimbursement. Effective immediately.


LRB100 16911 RPS 32052 b

FISCAL NOTE ACT MAY APPLY
PENSION IMPACT NOTE ACT MAY APPLY
STATE MANDATES ACT MAY REQUIRE REIMBURSEMENT

 

 

A BILL FOR

 

SB2517LRB100 16911 RPS 32052 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 adding
5Sections 16-106.4a and 16-106.4b and by changing Section 16-158
6as follows:
 
7    (40 ILCS 5/16-106.4a new)
8    Sec. 16-106.4a. Tier 1 benefits. "Tier 1 benefits": The
9benefits applicable to a member under this Article who first
10became a member or participant before January 1, 2011 under any
11reciprocal retirement system or pension fund established under
12this Code other than a retirement system or pension fund
13established under Article 2, 3, 4, 5, 6, or 18 of this Code.
 
14    (40 ILCS 5/16-106.4b new)
15    Sec. 16-106.4b. Tier 2 benefits. "Tier 2 benefits": The
16benefits applicable to a member of the System (i) who first
17becomes a member under this Article on or after January 1, 2011
18and before the implementation date, as defined under Section
191-161 and determined by the Board, and who is not eligible for
20Tier 1 benefits or (ii) who made the election under subsection
21(b) of Section 1-161.
 

 

 

SB2517- 2 -LRB100 16911 RPS 32052 b

1    (40 ILCS 5/16-158)   (from Ch. 108 1/2, par. 16-158)
2    Sec. 16-158. Contributions by State and other employing
3units.
4    (a) The State shall make contributions to the System by
5means of appropriations from the Common School Fund and other
6State funds of amounts which, together with other employer
7contributions, employee contributions, investment income, and
8other income, will be sufficient to meet the cost of
9maintaining and administering the System on a 90% funded basis
10in accordance with actuarial recommendations.
11    The Board shall determine the amount of State contributions
12required for each fiscal year on the basis of the actuarial
13tables and other assumptions adopted by the Board and the
14recommendations of the actuary, using the formula in subsection
15(b-3).
16    (a-1) Annually, on or before November 15 until November 15,
172011, the Board shall certify to the Governor the amount of the
18required State contribution for the coming fiscal year. The
19certification under this subsection (a-1) shall include a copy
20of the actuarial recommendations upon which it is based and
21shall specifically identify the System's projected State
22normal cost for that fiscal year.
23    On or before May 1, 2004, the Board shall recalculate and
24recertify to the Governor the amount of the required State
25contribution to the System for State fiscal year 2005, taking
26into account the amounts appropriated to and received by the

 

 

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1System under subsection (d) of Section 7.2 of the General
2Obligation Bond Act.
3    On or before July 1, 2005, the Board shall recalculate and
4recertify to the Governor the amount of the required State
5contribution to the System for State fiscal year 2006, taking
6into account the changes in required State contributions made
7by Public Act 94-4 this amendatory Act of the 94th General
8Assembly.
9    On or before April 1, 2011, the Board shall recalculate and
10recertify to the Governor the amount of the required State
11contribution to the System for State fiscal year 2011, applying
12the changes made by Public Act 96-889 to the System's assets
13and liabilities as of June 30, 2009 as though Public Act 96-889
14was approved on that date.
15    (a-5) On or before November 1 of each year, beginning
16November 1, 2012, the Board shall submit to the State Actuary,
17the Governor, and the General Assembly a proposed certification
18of the amount of the required State contribution to the System
19for the next fiscal year, along with all of the actuarial
20assumptions, calculations, and data upon which that proposed
21certification is based. On or before January 1 of each year,
22beginning January 1, 2013, the State Actuary shall issue a
23preliminary report concerning the proposed certification and
24identifying, if necessary, recommended changes in actuarial
25assumptions that the Board must consider before finalizing its
26certification of the required State contributions. On or before

 

 

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1January 15, 2013 and each January 15 thereafter, the Board
2shall certify to the Governor and the General Assembly the
3amount of the required State contribution for the next fiscal
4year. The Board's certification must note any deviations from
5the State Actuary's recommended changes, the reason or reasons
6for not following the State Actuary's recommended changes, and
7the fiscal impact of not following the State Actuary's
8recommended changes on the required State contribution.
9    (a-10) By November 1, 2017, the Board shall recalculate and
10recertify to the State Actuary, the Governor, and the General
11Assembly the amount of the State contribution to the System for
12State fiscal year 2018, taking into account the changes in
13required State contributions made by Public Act 100-23 this
14amendatory Act of the 100th General Assembly. The State Actuary
15shall review the assumptions and valuations underlying the
16Board's revised certification and issue a preliminary report
17concerning the proposed recertification and identifying, if
18necessary, recommended changes in actuarial assumptions that
19the Board must consider before finalizing its certification of
20the required State contributions. The Board's final
21certification must note any deviations from the State Actuary's
22recommended changes, the reason or reasons for not following
23the State Actuary's recommended changes, and the fiscal impact
24of not following the State Actuary's recommended changes on the
25required State contribution.
26    (b) Through State fiscal year 1995, the State contributions

 

 

SB2517- 5 -LRB100 16911 RPS 32052 b

1shall be paid to the System in accordance with Section 18-7 of
2the School Code.
3    (b-1) Beginning in State fiscal year 1996, on the 15th day
4of each month, or as soon thereafter as may be practicable, the
5Board shall submit vouchers for payment of State contributions
6to the System, in a total monthly amount of one-twelfth of the
7required annual State contribution certified under subsection
8(a-1). From March 5, 2004 (the effective date of Public Act
993-665) this amendatory Act of the 93rd General Assembly
10through June 30, 2004, the Board shall not submit vouchers for
11the remainder of fiscal year 2004 in excess of the fiscal year
122004 certified contribution amount determined under this
13Section after taking into consideration the transfer to the
14System under subsection (a) of Section 6z-61 of the State
15Finance Act. These vouchers shall be paid by the State
16Comptroller and Treasurer by warrants drawn on the funds
17appropriated to the System for that fiscal year.
18    If in any month the amount remaining unexpended from all
19other appropriations to the System for the applicable fiscal
20year (including the appropriations to the System under Section
218.12 of the State Finance Act and Section 1 of the State
22Pension Funds Continuing Appropriation Act) is less than the
23amount lawfully vouchered under this subsection, the
24difference shall be paid from the Common School Fund under the
25continuing appropriation authority provided in Section 1.1 of
26the State Pension Funds Continuing Appropriation Act.

 

 

SB2517- 6 -LRB100 16911 RPS 32052 b

1    (b-2) Allocations from the Common School Fund apportioned
2to school districts not coming under this System shall not be
3diminished or affected by the provisions of this Article.
4    (b-3) For State fiscal years 2012 through 2045, the minimum
5contribution to the System to be made by the State for each
6fiscal year shall be an amount determined by the System to be
7sufficient to bring the total assets of the System up to 90% of
8the total actuarial liabilities of the System by the end of
9State fiscal year 2045. In making these determinations, the
10required State contribution shall be calculated each year as a
11level percentage of payroll over the years remaining to and
12including fiscal year 2045 and shall be determined under the
13projected unit credit actuarial cost method.
14    For each of State fiscal years 2018, 2019, and 2020, the
15State shall make an additional contribution to the System equal
16to 2% of the total payroll of each employee who is deemed to
17have elected the benefits under Section 1-161 or who has made
18the election under subsection (c) of Section 1-161.
19    A change in an actuarial or investment assumption that
20increases or decreases the required State contribution and
21first applies in State fiscal year 2018 or thereafter shall be
22implemented in equal annual amounts over a 5-year period
23beginning in the State fiscal year in which the actuarial
24change first applies to the required State contribution.
25    A change in an actuarial or investment assumption that
26increases or decreases the required State contribution and

 

 

SB2517- 7 -LRB100 16911 RPS 32052 b

1first applied to the State contribution in fiscal year 2014,
22015, 2016, or 2017 shall be implemented:
3        (i) as already applied in State fiscal years before
4    2018; and
5        (ii) in the portion of the 5-year period beginning in
6    the State fiscal year in which the actuarial change first
7    applied that occurs in State fiscal year 2018 or
8    thereafter, by calculating the change in equal annual
9    amounts over that 5-year period and then implementing it at
10    the resulting annual rate in each of the remaining fiscal
11    years in that 5-year period.
12    For State fiscal years 1996 through 2005, the State
13contribution to the System, as a percentage of the applicable
14employee payroll, shall be increased in equal annual increments
15so that by State fiscal year 2011, the State is contributing at
16the rate required under this Section; except that in the
17following specified State fiscal years, the State contribution
18to the System shall not be less than the following indicated
19percentages of the applicable employee payroll, even if the
20indicated percentage will produce a State contribution in
21excess of the amount otherwise required under this subsection
22and subsection (a), and notwithstanding any contrary
23certification made under subsection (a-1) before May 27, 1998
24(the effective date of Public Act 90-582) this amendatory Act
25of 1998: 10.02% in FY 1999; 10.77% in FY 2000; 11.47% in FY
262001; 12.16% in FY 2002; 12.86% in FY 2003; and 13.56% in FY

 

 

SB2517- 8 -LRB100 16911 RPS 32052 b

12004.
2    Notwithstanding any other provision of this Article, the
3total required State contribution for State fiscal year 2006 is
4$534,627,700.
5    Notwithstanding any other provision of this Article, the
6total required State contribution for State fiscal year 2007 is
7$738,014,500.
8    For each of State fiscal years 2008 through 2009, the State
9contribution to the System, as a percentage of the applicable
10employee payroll, shall be increased in equal annual increments
11from the required State contribution for State fiscal year
122007, so that by State fiscal year 2011, the State is
13contributing at the rate otherwise required under this Section.
14    Notwithstanding any other provision of this Article, the
15total required State contribution for State fiscal year 2010 is
16$2,089,268,000 and shall be made from the proceeds of bonds
17sold in fiscal year 2010 pursuant to Section 7.2 of the General
18Obligation Bond Act, less (i) the pro rata share of bond sale
19expenses determined by the System's share of total bond
20proceeds, (ii) any amounts received from the Common School Fund
21in fiscal year 2010, and (iii) any reduction in bond proceeds
22due to the issuance of discounted bonds, if applicable.
23    Notwithstanding any other provision of this Article, the
24total required State contribution for State fiscal year 2011 is
25the amount recertified by the System on or before April 1, 2011
26pursuant to subsection (a-1) of this Section and shall be made

 

 

SB2517- 9 -LRB100 16911 RPS 32052 b

1from the proceeds of bonds sold in fiscal year 2011 pursuant to
2Section 7.2 of the General Obligation Bond Act, less (i) the
3pro rata share of bond sale expenses determined by the System's
4share of total bond proceeds, (ii) any amounts received from
5the Common School Fund in fiscal year 2011, and (iii) any
6reduction in bond proceeds due to the issuance of discounted
7bonds, if applicable. This amount shall include, in addition to
8the amount certified by the System, an amount necessary to meet
9employer contributions required by the State as an employer
10under paragraph (e) of this Section, which may also be used by
11the System for contributions required by paragraph (a) of
12Section 16-127.
13    Beginning in State fiscal year 2046, the minimum State
14contribution for each fiscal year shall be the amount needed to
15maintain the total assets of the System at 90% of the total
16actuarial liabilities of the System.
17    Amounts received by the System pursuant to Section 25 of
18the Budget Stabilization Act or Section 8.12 of the State
19Finance Act in any fiscal year do not reduce and do not
20constitute payment of any portion of the minimum State
21contribution required under this Article in that fiscal year.
22Such amounts shall not reduce, and shall not be included in the
23calculation of, the required State contributions under this
24Article in any future year until the System has reached a
25funding ratio of at least 90%. A reference in this Article to
26the "required State contribution" or any substantially similar

 

 

SB2517- 10 -LRB100 16911 RPS 32052 b

1term does not include or apply to any amounts payable to the
2System under Section 25 of the Budget Stabilization Act.
3    Notwithstanding any other provision of this Section, the
4required State contribution for State fiscal year 2005 and for
5fiscal year 2008 and each fiscal year thereafter, as calculated
6under this Section and certified under subsection (a-1), shall
7not exceed an amount equal to (i) the amount of the required
8State contribution that would have been calculated under this
9Section for that fiscal year if the System had not received any
10payments under subsection (d) of Section 7.2 of the General
11Obligation Bond Act, minus (ii) the portion of the State's
12total debt service payments for that fiscal year on the bonds
13issued in fiscal year 2003 for the purposes of that Section
147.2, as determined and certified by the Comptroller, that is
15the same as the System's portion of the total moneys
16distributed under subsection (d) of Section 7.2 of the General
17Obligation Bond Act. In determining this maximum for State
18fiscal years 2008 through 2010, however, the amount referred to
19in item (i) shall be increased, as a percentage of the
20applicable employee payroll, in equal increments calculated
21from the sum of the required State contribution for State
22fiscal year 2007 plus the applicable portion of the State's
23total debt service payments for fiscal year 2007 on the bonds
24issued in fiscal year 2003 for the purposes of Section 7.2 of
25the General Obligation Bond Act, so that, by State fiscal year
262011, the State is contributing at the rate otherwise required

 

 

SB2517- 11 -LRB100 16911 RPS 32052 b

1under this Section.
2    (b-4) Beginning in fiscal year 2018, each employer under
3this Article shall pay to the System a required contribution
4determined as a percentage of projected payroll and sufficient
5to produce an annual amount equal to:
6        (i) for each of fiscal years 2018, 2019, and 2020, the
7    defined benefit normal cost of the defined benefit plan,
8    less the employee contribution, for each employee of that
9    employer who has elected or who is deemed to have elected
10    the benefits under Section 1-161 or who has made the
11    election under subsection (b) of Section 1-161; for fiscal
12    year 2021 and each fiscal year thereafter, the defined
13    benefit normal cost of the defined benefit plan, less the
14    employee contribution, plus 2%, for each employee of that
15    employer who has elected or who is deemed to have elected
16    the benefits under Section 1-161 or who has made the
17    election under subsection (b) of Section 1-161; plus
18        (ii) the amount required for that fiscal year to
19    amortize any unfunded actuarial accrued liability
20    associated with the present value of liabilities
21    attributable to the employer's account under Section
22    16-158.3, determined as a level percentage of payroll over
23    a 30-year rolling amortization period.
24    In determining contributions required under item (i) of
25this subsection, the System shall determine an aggregate rate
26for all employers, expressed as a percentage of projected

 

 

SB2517- 12 -LRB100 16911 RPS 32052 b

1payroll.
2    In determining the contributions required under item (ii)
3of this subsection, the amount shall be computed by the System
4on the basis of the actuarial assumptions and tables used in
5the most recent actuarial valuation of the System that is
6available at the time of the computation.
7    The contributions required under this subsection (b-4)
8shall be paid by an employer concurrently with that employer's
9payroll payment period. The State, as the actual employer of an
10employee, shall make the required contributions under this
11subsection.
12    (c) Payment of the required State contributions and of all
13pensions, retirement annuities, death benefits, refunds, and
14other benefits granted under or assumed by this System, and all
15expenses in connection with the administration and operation
16thereof, are obligations of the State.
17    If members are paid from special trust or federal funds
18which are administered by the employing unit, whether school
19district or other unit, the employing unit shall pay to the
20System from such funds the full accruing retirement costs based
21upon that service, which, beginning July 1, 2017, shall be at a
22rate, expressed as a percentage of salary, equal to the total
23employer's normal cost, expressed as a percentage of payroll,
24as determined by the System. Employer contributions, based on
25salary paid to members from federal funds, may be forwarded by
26the distributing agency of the State of Illinois to the System

 

 

SB2517- 13 -LRB100 16911 RPS 32052 b

1prior to allocation, in an amount determined in accordance with
2guidelines established by such agency and the System. Any
3contribution for fiscal year 2015 collected as a result of the
4change made by Public Act 98-674 this amendatory Act of the
598th General Assembly shall be considered a State contribution
6under subsection (b-3) of this Section.
7    (d) Effective July 1, 1986, any employer of a teacher as
8defined in paragraph (8) of Section 16-106 shall pay the
9employer's normal cost of benefits based upon the teacher's
10service, in addition to employee contributions, as determined
11by the System. Such employer contributions shall be forwarded
12monthly in accordance with guidelines established by the
13System.
14    However, with respect to benefits granted under Section
1516-133.4 or 16-133.5 to a teacher as defined in paragraph (8)
16of Section 16-106, the employer's contribution shall be 12%
17(rather than 20%) of the member's highest annual salary rate
18for each year of creditable service granted, and the employer
19shall also pay the required employee contribution on behalf of
20the teacher. For the purposes of Sections 16-133.4 and
2116-133.5, a teacher as defined in paragraph (8) of Section
2216-106 who is serving in that capacity while on leave of
23absence from another employer under this Article shall not be
24considered an employee of the employer from which the teacher
25is on leave.
26    (e) Beginning July 1, 1998, every employer of a teacher

 

 

SB2517- 14 -LRB100 16911 RPS 32052 b

1shall pay to the System an employer contribution computed as
2follows:
3        (1) Beginning July 1, 1998 through June 30, 1999, the
4    employer contribution shall be equal to 0.3% of each
5    teacher's salary.
6        (2) Beginning July 1, 1999 and thereafter, the employer
7    contribution shall be equal to 0.58% of each teacher's
8    salary.
9The school district or other employing unit may pay these
10employer contributions out of any source of funding available
11for that purpose and shall forward the contributions to the
12System on the schedule established for the payment of member
13contributions.
14    These employer contributions are intended to offset a
15portion of the cost to the System of the increases in
16retirement benefits resulting from Public Act 90-582 this
17amendatory Act of 1998.
18    Each employer of teachers is entitled to a credit against
19the contributions required under this subsection (e) with
20respect to salaries paid to teachers for the period January 1,
212002 through June 30, 2003, equal to the amount paid by that
22employer under subsection (a-5) of Section 6.6 of the State
23Employees Group Insurance Act of 1971 with respect to salaries
24paid to teachers for that period.
25    The additional 1% employee contribution required under
26Section 16-152 by Public Act 90-582 this amendatory Act of 1998

 

 

SB2517- 15 -LRB100 16911 RPS 32052 b

1is the responsibility of the teacher and not the teacher's
2employer, unless the employer agrees, through collective
3bargaining or otherwise, to make the contribution on behalf of
4the teacher.
5    If an employer is required by a contract in effect on May
61, 1998 between the employer and an employee organization to
7pay, on behalf of all its full-time employees covered by this
8Article, all mandatory employee contributions required under
9this Article, then the employer shall be excused from paying
10the employer contribution required under this subsection (e)
11for the balance of the term of that contract. The employer and
12the employee organization shall jointly certify to the System
13the existence of the contractual requirement, in such form as
14the System may prescribe. This exclusion shall cease upon the
15termination, extension, or renewal of the contract at any time
16after May 1, 1998.
17    (f) If the amount of a teacher's salary for any school year
18beginning on or after June 1, 2005 and before July 1, 2019 used
19to determine final average salary exceeds the member's annual
20full-time salary rate with the same employer for the previous
21school year by more than 6%, the teacher's employer shall pay
22to the System, in addition to all other payments required under
23this Section and in accordance with guidelines established by
24the System, the present value of the increase in benefits
25resulting from the portion of the increase in salary that is in
26excess of 6%. This present value shall be computed by the

 

 

SB2517- 16 -LRB100 16911 RPS 32052 b

1System on the basis of the actuarial assumptions and tables
2used in the most recent actuarial valuation of the System that
3is available at the time of the computation. If a teacher's
4salary for the 2005-2006 school year is used to determine final
5average salary under this subsection (f), then the changes made
6to this subsection (f) by Public Act 94-1057 shall apply in
7calculating whether the increase in his or her salary is in
8excess of 6%. For the purposes of this Section, change in
9employment under Section 10-21.12 of the School Code on or
10after June 1, 2005 shall constitute a change in employer. The
11System may require the employer to provide any pertinent
12information or documentation. The changes made to this
13subsection (f) by Public Act 94-1111 this amendatory Act of the
1494th General Assembly apply without regard to whether the
15teacher was in service on or after its effective date.
16    Whenever it determines that a payment is or may be required
17under this subsection, the System shall calculate the amount of
18the payment and bill the employer for that amount. The bill
19shall specify the calculations used to determine the amount
20due. If the employer disputes the amount of the bill, it may,
21within 30 days after receipt of the bill, apply to the System
22in writing for a recalculation. The application must specify in
23detail the grounds of the dispute and, if the employer asserts
24that the calculation is subject to subsection (g) or (h) of
25this Section, must include an affidavit setting forth and
26attesting to all facts within the employer's knowledge that are

 

 

SB2517- 17 -LRB100 16911 RPS 32052 b

1pertinent to the applicability of that subsection. Upon
2receiving a timely application for recalculation, the System
3shall review the application and, if appropriate, recalculate
4the amount due.
5    The employer contributions required under this subsection
6(f) may be paid in the form of a lump sum within 90 days after
7receipt of the bill. If the employer contributions are not paid
8within 90 days after receipt of the bill, then interest will be
9charged at a rate equal to the System's annual actuarially
10assumed rate of return on investment compounded annually from
11the 91st day after receipt of the bill. Payments must be
12concluded within 3 years after the employer's receipt of the
13bill.
14    (f-1) Beginning in fiscal year 2020 and for each fiscal
15year thereafter, the System shall calculate the projected
16amount of the increase in the employer normal cost of benefits,
17expressed as a percentage of salary and reflecting separate
18amounts for Tier 1 benefits and Tier 2 benefits, resulting from
19any increase in salary over the preceding school year,
20expressed as a percentage of salary. Except for a teacher who
21first becomes a teacher on or after the implementation date, as
22defined under Section 1-161 and determined by the Board, if the
23amount of a teacher's salary for any school year beginning on
24or after July 1, 2019 exceeds the teacher's annual full-time
25salary rate with the same employer for the previous school
26year, then the teacher's employer shall pay to the System the

 

 

SB2517- 18 -LRB100 16911 RPS 32052 b

1projected amount of the increase in the employer normal cost of
2benefits, as determined by the System and reflecting whether
3the teacher will receive Tier 1 benefits or Tier 2 benefits,
4resulting from the increase in the teacher's salary over the
5previous school year. The System may require the employer to
6provide any pertinent information or documentation.
7    Whenever it determines that a payment is or may be required
8under this subsection (f-1), the System shall calculate the
9amount of the payment and bill the employer for that amount.
10The bill shall specify the calculations used to determine the
11amount due. If the employer disputes the amount of the bill, it
12may, within 30 days after receipt of the bill, apply to the
13System in writing for a recalculation. The application must
14specify in detail the grounds of the dispute and, if the
15employer asserts that the calculation is subject to subsection
16(h-1) of this Section, must include an affidavit setting forth
17and attesting to all facts within the employer's knowledge that
18are pertinent to the applicability of subsection (h-1). Upon
19receiving a timely application for recalculation, the System
20shall review the application and, if appropriate, recalculate
21the amount due.
22    The employer contributions required under this subsection
23(f-1) may be paid in the form of a lump sum within 90 days after
24receipt of the bill. If the employer contributions are not paid
25within 90 days after receipt of the bill, then interest shall
26be charged at a rate equal to the System's annual actuarially

 

 

SB2517- 19 -LRB100 16911 RPS 32052 b

1assumed rate of return on investment compounded annually from
2the 91st day after receipt of the bill. Payments must be
3concluded within 3 years after the employer's receipt of the
4bill.
5    (g) This subsection (g) applies only to payments made or
6salary increases given on or after June 1, 2005 but before July
71, 2011. The changes made by Public Act 94-1057 shall not
8require the System to refund any payments received before July
931, 2006 (the effective date of Public Act 94-1057).
10    When assessing payment for any amount due under subsection
11(f), the System shall exclude salary increases paid to teachers
12under contracts or collective bargaining agreements entered
13into, amended, or renewed before June 1, 2005.
14    When assessing payment for any amount due under subsection
15(f), the System shall exclude salary increases paid to a
16teacher at a time when the teacher is 10 or more years from
17retirement eligibility under Section 16-132 or 16-133.2.
18    When assessing payment for any amount due under subsection
19(f), the System shall exclude salary increases resulting from
20overload work, including summer school, when the school
21district has certified to the System, and the System has
22approved the certification, that (i) the overload work is for
23the sole purpose of classroom instruction in excess of the
24standard number of classes for a full-time teacher in a school
25district during a school year and (ii) the salary increases are
26equal to or less than the rate of pay for classroom instruction

 

 

SB2517- 20 -LRB100 16911 RPS 32052 b

1computed on the teacher's current salary and work schedule.
2    When assessing payment for any amount due under subsection
3(f), the System shall exclude a salary increase resulting from
4a promotion (i) for which the employee is required to hold a
5certificate or supervisory endorsement issued by the State
6Teacher Certification Board that is a different certification
7or supervisory endorsement than is required for the teacher's
8previous position and (ii) to a position that has existed and
9been filled by a member for no less than one complete academic
10year and the salary increase from the promotion is an increase
11that results in an amount no greater than the lesser of the
12average salary paid for other similar positions in the district
13requiring the same certification or the amount stipulated in
14the collective bargaining agreement for a similar position
15requiring the same certification.
16    When assessing payment for any amount due under subsection
17(f), the System shall exclude any payment to the teacher from
18the State of Illinois or the State Board of Education over
19which the employer does not have discretion, notwithstanding
20that the payment is included in the computation of final
21average salary.
22    (h) When assessing payment for any amount due under
23subsection (f), the System shall exclude any salary increase
24described in subsection (g) of this Section given on or after
25July 1, 2011 but before July 1, 2014 under a contract or
26collective bargaining agreement entered into, amended, or

 

 

SB2517- 21 -LRB100 16911 RPS 32052 b

1renewed on or after June 1, 2005 but before July 1, 2011.
2Notwithstanding any other provision of this Section, any
3payments made or salary increases given after June 30, 2014
4shall be used in assessing payment for any amount due under
5subsection (f) of this Section.
6    (h-1) When assessing payment for any amount due under
7subsection (f-1), the System shall exclude earnings increases
8paid to members under contracts or collective bargaining
9agreements entered into, amended, or renewed before the
10effective date of this amendatory Act of the 100th General
11Assembly.
12    When assessing payment for any amount due under subsection
13(f-1), the System shall exclude earnings increases paid to
14members who first become members on or after the implementation
15date, as defined under Section 1-161 and determined by the
16Board.
17    (i) The System shall prepare a report and file copies of
18the report with the Governor and the General Assembly by
19January 1, 2007 that contains all of the following information:
20        (1) The number of recalculations required by the
21    changes made to this Section by Public Act 94-1057 for each
22    employer.
23        (2) The dollar amount by which each employer's
24    contribution to the System was changed due to
25    recalculations required by Public Act 94-1057.
26        (3) The total amount the System received from each

 

 

SB2517- 22 -LRB100 16911 RPS 32052 b

1    employer as a result of the changes made to this Section by
2    Public Act 94-4.
3        (4) The increase in the required State contribution
4    resulting from the changes made to this Section by Public
5    Act 94-1057.
6    (i-5) For school years beginning on or after July 1, 2017,
7if the amount of a participant's salary for any school year,
8determined on a full-time equivalent basis, exceeds the amount
9of the salary set for the Governor, the participant's employer
10shall pay to the System, in addition to all other payments
11required under this Section and in accordance with guidelines
12established by the System, an amount determined by the System
13to be equal to the employer normal cost, as established by the
14System and expressed as a total percentage of payroll,
15multiplied by the amount of salary in excess of the amount of
16the salary set for the Governor. This amount shall be computed
17by the System on the basis of the actuarial assumptions and
18tables used in the most recent actuarial valuation of the
19System that is available at the time of the computation. The
20System may require the employer to provide any pertinent
21information or documentation.
22    Whenever it determines that a payment is or may be required
23under this subsection, the System shall calculate the amount of
24the payment and bill the employer for that amount. The bill
25shall specify the calculations used to determine the amount
26due. If the employer disputes the amount of the bill, it may,

 

 

SB2517- 23 -LRB100 16911 RPS 32052 b

1within 30 days after receipt of the bill, apply to the System
2in writing for a recalculation. The application must specify in
3detail the grounds of the dispute. Upon receiving a timely
4application for recalculation, the System shall review the
5application and, if appropriate, recalculate the amount due.
6    The employer contributions required under this subsection
7may be paid in the form of a lump sum within 90 days after
8receipt of the bill. If the employer contributions are not paid
9within 90 days after receipt of the bill, then interest will be
10charged at a rate equal to the System's annual actuarially
11assumed rate of return on investment compounded annually from
12the 91st day after receipt of the bill. Payments must be
13concluded within 3 years after the employer's receipt of the
14bill.
15    (j) For purposes of determining the required State
16contribution to the System, the value of the System's assets
17shall be equal to the actuarial value of the System's assets,
18which shall be calculated as follows:
19    As of June 30, 2008, the actuarial value of the System's
20assets shall be equal to the market value of the assets as of
21that date. In determining the actuarial value of the System's
22assets for fiscal years after June 30, 2008, any actuarial
23gains or losses from investment return incurred in a fiscal
24year shall be recognized in equal annual amounts over the
255-year period following that fiscal year.
26    (k) For purposes of determining the required State

 

 

SB2517- 24 -LRB100 16911 RPS 32052 b

1contribution to the system for a particular year, the actuarial
2value of assets shall be assumed to earn a rate of return equal
3to the system's actuarially assumed rate of return.
4(Source: P.A. 100-23, eff. 7-6-17; 100-340, eff. 8-25-17;
5revised 9-25-17.)
 
6    Section 90. The State Mandates Act is amended by adding
7Section 8.42 as follows:
 
8    (30 ILCS 805/8.42 new)
9    Sec. 8.42. Exempt mandate. Notwithstanding Sections 6 and 8
10of this Act, no reimbursement by the State is required for the
11implementation of any mandate created by this amendatory Act of
12the 100th General Assembly.
 
13    Section 99. Effective date. This Act takes effect upon
14becoming law.