100TH GENERAL ASSEMBLY
State of Illinois
2017 and 2018
SB3622

 

Introduced 7/25/2018, by Sen. Dale Fowler

 

SYNOPSIS AS INTRODUCED:
 
40 ILCS 5/15-155  from Ch. 108 1/2, par. 15-155
40 ILCS 5/16-158  from Ch. 108 1/2, par. 16-158

    Amends the Downstate Teachers and State Universities Articles of the Illinois Pension Code. Requires an employer to make an additional employer contribution for a participant whose earnings for any academic year used to determine the final rate of earnings exceed the amount of his or her earnings with the same employer for the previous academic year by more than 6% (instead of 3%). Makes conforming changes. Effective immediately.


LRB100 22541 RPS 41439 b

FISCAL NOTE ACT MAY APPLY
PENSION IMPACT NOTE ACT MAY APPLY

 

 

A BILL FOR

 

SB3622LRB100 22541 RPS 41439 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 changing
5Sections 15-155 and 16-158 as follows:
 
6    (40 ILCS 5/15-155)  (from Ch. 108 1/2, par. 15-155)
7    Sec. 15-155. Employer contributions.
8    (a) The State of Illinois shall make contributions by
9appropriations of amounts which, together with the other
10employer contributions from trust, federal, and other funds,
11employee contributions, income from investments, and other
12income of this System, will be sufficient to meet the cost of
13maintaining and administering the System on a 90% funded basis
14in accordance with actuarial recommendations.
15    The Board shall determine the amount of State contributions
16required for each fiscal year on the basis of the actuarial
17tables and other assumptions adopted by the Board and the
18recommendations of the actuary, using the formula in subsection
19(a-1).
20    (a-1) For State fiscal years 2012 through 2045, the minimum
21contribution to the System to be made by the State for each
22fiscal year shall be an amount determined by the System to be
23sufficient to bring the total assets of the System up to 90% of

 

 

SB3622- 2 -LRB100 22541 RPS 41439 b

1the total actuarial liabilities of the System by the end of
2State fiscal year 2045. In making these determinations, the
3required State contribution shall be calculated each year as a
4level percentage of payroll over the years remaining to and
5including fiscal year 2045 and shall be determined under the
6projected unit credit actuarial cost method.
7    For each of State fiscal years 2018, 2019, and 2020, the
8State shall make an additional contribution to the System equal
9to 2% of the total payroll of each employee who is deemed to
10have elected the benefits under Section 1-161 or who has made
11the election under subsection (c) of Section 1-161.
12    A change in an actuarial or investment assumption that
13increases or decreases the required State contribution and
14first applies in State fiscal year 2018 or thereafter shall be
15implemented in equal annual amounts over a 5-year period
16beginning in the State fiscal year in which the actuarial
17change first applies to the required State contribution.
18    A change in an actuarial or investment assumption that
19increases or decreases the required State contribution and
20first applied to the State contribution in fiscal year 2014,
212015, 2016, or 2017 shall be implemented:
22        (i) as already applied in State fiscal years before
23    2018; and
24        (ii) in the portion of the 5-year period beginning in
25    the State fiscal year in which the actuarial change first
26    applied that occurs in State fiscal year 2018 or

 

 

SB3622- 3 -LRB100 22541 RPS 41439 b

1    thereafter, by calculating the change in equal annual
2    amounts over that 5-year period and then implementing it at
3    the resulting annual rate in each of the remaining fiscal
4    years in that 5-year period.
5    For State fiscal years 1996 through 2005, the State
6contribution to the System, as a percentage of the applicable
7employee payroll, shall be increased in equal annual increments
8so that by State fiscal year 2011, the State is contributing at
9the rate required under this Section.
10    Notwithstanding any other provision of this Article, the
11total required State contribution for State fiscal year 2006 is
12$166,641,900.
13    Notwithstanding any other provision of this Article, the
14total required State contribution for State fiscal year 2007 is
15$252,064,100.
16    For each of State fiscal years 2008 through 2009, the State
17contribution to the System, as a percentage of the applicable
18employee payroll, shall be increased in equal annual increments
19from the required State contribution for State fiscal year
202007, so that by State fiscal year 2011, the State is
21contributing at the rate otherwise required under this Section.
22    Notwithstanding any other provision of this Article, the
23total required State contribution for State fiscal year 2010 is
24$702,514,000 and shall be made from the State Pensions Fund and
25proceeds of bonds sold in fiscal year 2010 pursuant to Section
267.2 of the General Obligation Bond Act, less (i) the pro rata

 

 

SB3622- 4 -LRB100 22541 RPS 41439 b

1share of bond sale expenses determined by the System's share of
2total bond proceeds, (ii) any amounts received from the General
3Revenue Fund in fiscal year 2010, (iii) any reduction in bond
4proceeds due to the issuance of discounted bonds, if
5applicable.
6    Notwithstanding any other provision of this Article, the
7total required State contribution for State fiscal year 2011 is
8the amount recertified by the System on or before April 1, 2011
9pursuant to Section 15-165 and shall be made from the State
10Pensions Fund and proceeds of bonds sold in fiscal year 2011
11pursuant to Section 7.2 of the General Obligation Bond Act,
12less (i) the pro rata share of bond sale expenses determined by
13the System's share of total bond proceeds, (ii) any amounts
14received from the General Revenue Fund in fiscal year 2011, and
15(iii) any reduction in bond proceeds due to the issuance of
16discounted bonds, if applicable.
17    Beginning in State fiscal year 2046, the minimum State
18contribution for each fiscal year shall be the amount needed to
19maintain the total assets of the System at 90% of the total
20actuarial liabilities of the System.
21    Amounts received by the System pursuant to Section 25 of
22the Budget Stabilization Act or Section 8.12 of the State
23Finance Act in any fiscal year do not reduce and do not
24constitute payment of any portion of the minimum State
25contribution required under this Article in that fiscal year.
26Such amounts shall not reduce, and shall not be included in the

 

 

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1calculation of, the required State contributions under this
2Article in any future year until the System has reached a
3funding ratio of at least 90%. A reference in this Article to
4the "required State contribution" or any substantially similar
5term does not include or apply to any amounts payable to the
6System under Section 25 of the Budget Stabilization Act.
7    Notwithstanding any other provision of this Section, the
8required State contribution for State fiscal year 2005 and for
9fiscal year 2008 and each fiscal year thereafter, as calculated
10under this Section and certified under Section 15-165, shall
11not exceed an amount equal to (i) the amount of the required
12State contribution that would have been calculated under this
13Section for that fiscal year if the System had not received any
14payments under subsection (d) of Section 7.2 of the General
15Obligation Bond Act, minus (ii) the portion of the State's
16total debt service payments for that fiscal year on the bonds
17issued in fiscal year 2003 for the purposes of that Section
187.2, as determined and certified by the Comptroller, that is
19the same as the System's portion of the total moneys
20distributed under subsection (d) of Section 7.2 of the General
21Obligation Bond Act. In determining this maximum for State
22fiscal years 2008 through 2010, however, the amount referred to
23in item (i) shall be increased, as a percentage of the
24applicable employee payroll, in equal increments calculated
25from the sum of the required State contribution for State
26fiscal year 2007 plus the applicable portion of the State's

 

 

SB3622- 6 -LRB100 22541 RPS 41439 b

1total debt service payments for fiscal year 2007 on the bonds
2issued in fiscal year 2003 for the purposes of Section 7.2 of
3the General Obligation Bond Act, so that, by State fiscal year
42011, the State is contributing at the rate otherwise required
5under this Section.
6    (a-2) Beginning in fiscal year 2018, each employer under
7this Article shall pay to the System a required contribution
8determined as a percentage of projected payroll and sufficient
9to produce an annual amount equal to:
10        (i) for each of fiscal years 2018, 2019, and 2020, the
11    defined benefit normal cost of the defined benefit plan,
12    less the employee contribution, for each employee of that
13    employer who has elected or who is deemed to have elected
14    the benefits under Section 1-161 or who has made the
15    election under subsection (c) of Section 1-161; for fiscal
16    year 2021 and each fiscal year thereafter, the defined
17    benefit normal cost of the defined benefit plan, less the
18    employee contribution, plus 2%, 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 (c) of Section 1-161; plus
22        (ii) the amount required for that fiscal year to
23    amortize any unfunded actuarial accrued liability
24    associated with the present value of liabilities
25    attributable to the employer's account under Section
26    15-155.2, determined as a level percentage of payroll over

 

 

SB3622- 7 -LRB100 22541 RPS 41439 b

1    a 30-year rolling amortization period.
2    In determining contributions required under item (i) of
3this subsection, the System shall determine an aggregate rate
4for all employers, expressed as a percentage of projected
5payroll.
6    In determining the contributions required under item (ii)
7of this subsection, the amount shall be computed by the System
8on the basis of the actuarial assumptions and tables used in
9the most recent actuarial valuation of the System that is
10available at the time of the computation.
11    The contributions required under this subsection (a-2)
12shall be paid by an employer concurrently with that employer's
13payroll payment period. The State, as the actual employer of an
14employee, shall make the required contributions under this
15subsection.
16    As used in this subsection, "academic year" means the
1712-month period beginning September 1.
18    (b) If an employee is paid from trust or federal funds, the
19employer shall pay to the Board contributions from those funds
20which are sufficient to cover the accruing normal costs on
21behalf of the employee. However, universities having employees
22who are compensated out of local auxiliary funds, income funds,
23or service enterprise funds are not required to pay such
24contributions on behalf of those employees. The local auxiliary
25funds, income funds, and service enterprise funds of
26universities shall not be considered trust funds for the

 

 

SB3622- 8 -LRB100 22541 RPS 41439 b

1purpose of this Article, but funds of alumni associations,
2foundations, and athletic associations which are affiliated
3with the universities included as employers under this Article
4and other employers which do not receive State appropriations
5are considered to be trust funds for the purpose of this
6Article.
7    (b-1) The City of Urbana and the City of Champaign shall
8each make employer contributions to this System for their
9respective firefighter employees who participate in this
10System pursuant to subsection (h) of Section 15-107. The rate
11of contributions to be made by those municipalities shall be
12determined annually by the Board on the basis of the actuarial
13assumptions adopted by the Board and the recommendations of the
14actuary, and shall be expressed as a percentage of salary for
15each such employee. The Board shall certify the rate to the
16affected municipalities as soon as may be practical. The
17employer contributions required under this subsection shall be
18remitted by the municipality to the System at the same time and
19in the same manner as employee contributions.
20    (c) Through State fiscal year 1995: The total employer
21contribution shall be apportioned among the various funds of
22the State and other employers, whether trust, federal, or other
23funds, in accordance with actuarial procedures approved by the
24Board. State of Illinois contributions for employers receiving
25State appropriations for personal services shall be payable
26from appropriations made to the employers or to the System. The

 

 

SB3622- 9 -LRB100 22541 RPS 41439 b

1contributions for Class I community colleges covering earnings
2other than those paid from trust and federal funds, shall be
3payable solely from appropriations to the Illinois Community
4College Board or the System for employer contributions.
5    (d) Beginning in State fiscal year 1996, the required State
6contributions to the System shall be appropriated directly to
7the System and shall be payable through vouchers issued in
8accordance with subsection (c) of Section 15-165, except as
9provided in subsection (g).
10    (e) The State Comptroller shall draw warrants payable to
11the System upon proper certification by the System or by the
12employer in accordance with the appropriation laws and this
13Code.
14    (f) Normal costs under this Section means liability for
15pensions and other benefits which accrues to the System because
16of the credits earned for service rendered by the participants
17during the fiscal year and expenses of administering the
18System, but shall not include the principal of or any
19redemption premium or interest on any bonds issued by the Board
20or any expenses incurred or deposits required in connection
21therewith.
22    (g) If For academic years beginning on or after June 1,
232005 and before July 1, 2018 and for earnings paid to a
24participant under a contract or collective bargaining
25agreement entered into, amended, or renewed before the
26effective date of this amendatory Act of the 100th General

 

 

SB3622- 10 -LRB100 22541 RPS 41439 b

1Assembly, if the amount of a participant's earnings for any
2academic year used to determine the final rate of earnings,
3determined on a full-time equivalent basis, exceeds the amount
4of his or her earnings with the same employer for the previous
5academic year, determined on a full-time equivalent basis, by
6more than 6%, the participant's employer shall pay to the
7System, in addition to all other payments required under this
8Section and in accordance with guidelines established by the
9System, the present value of the increase in benefits resulting
10from the portion of the increase in earnings that is in excess
11of 6%. This present value shall be computed by the System on
12the basis of the actuarial assumptions and tables used in the
13most recent actuarial valuation of the System that is available
14at the time of the computation. The System may require the
15employer to provide any pertinent information or
16documentation.
17    Whenever it determines that a payment is or may be required
18under this subsection (g), the System shall calculate the
19amount of the payment and bill the employer for that amount.
20The bill shall specify the calculations used to determine the
21amount due. If the employer disputes the amount of the bill, it
22may, within 30 days after receipt of the bill, apply to the
23System in writing for a recalculation. The application must
24specify in detail the grounds of the dispute and, if the
25employer asserts that the calculation is subject to subsection
26(h) or (i) of this Section or that subsection (g-1) applies,

 

 

SB3622- 11 -LRB100 22541 RPS 41439 b

1must include an affidavit setting forth and attesting to all
2facts within the employer's knowledge that are pertinent to the
3applicability of that subsection. 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
7(g) may 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    When assessing payment for any amount due under this
16subsection (g), the System shall include earnings, to the
17extent not established by a participant under Section 15-113.11
18or 15-113.12, that would have been paid to the participant had
19the participant not taken (i) periods of voluntary or
20involuntary furlough occurring on or after July 1, 2015 and on
21or before June 30, 2017 or (ii) periods of voluntary pay
22reduction in lieu of furlough occurring on or after July 1,
232015 and on or before June 30, 2017. Determining earnings that
24would have been paid to a participant had the participant not
25taken periods of voluntary or involuntary furlough or periods
26of voluntary pay reduction shall be the responsibility of the

 

 

SB3622- 12 -LRB100 22541 RPS 41439 b

1employer, and shall be reported in a manner prescribed by the
2System.
3    This subsection (g) does not apply to (1) Tier 2 hybrid
4plan members and (2) Tier 2 defined benefit members who first
5participate under this Article on or after the implementation
6date of the Optional Hybrid Plan.
7    (g-1) (Blank). For academic years beginning on or after
8July 1, 2018 and for earnings paid to a participant under a
9contract or collective bargaining agreement entered into,
10amended, or renewed on or after the effective date of this
11amendatory Act of the 100th General Assembly, if the amount of
12a participant's earnings for any academic year used to
13determine the final rate of earnings, determined on a full-time
14equivalent basis, exceeds the amount of his or her earnings
15with the same employer for the previous academic year,
16determined on a full-time equivalent basis, by more than 3%,
17then the participant's employer shall pay to the System, in
18addition to all other payments required under this Section and
19in accordance with guidelines established by the System, the
20present value of the increase in benefits resulting from the
21portion of the increase in earnings that is in excess of 3%.
22This present value shall be computed by the System on the basis
23of the actuarial assumptions and tables used in the most recent
24actuarial valuation of the System that is available at the time
25of the computation. The System may require the employer to
26provide any pertinent information or documentation.

 

 

SB3622- 13 -LRB100 22541 RPS 41439 b

1    Whenever it determines that a payment is or may be required
2under this subsection (g-1), the System shall calculate the
3amount of the payment and bill the employer for that amount.
4The bill shall specify the calculations used to determine the
5amount due. If the employer disputes the amount of the bill, it
6may, within 30 days after receipt of the bill, apply to the
7System in writing for a recalculation. The application must
8specify in detail the grounds of the dispute and, if the
9employer asserts that subsection (g) of this Section applies,
10must include an affidavit setting forth and attesting to all
11facts within the employer's knowledge that are pertinent to the
12applicability of subsection (g). Upon receiving a timely
13application for recalculation, the System shall review the
14application and, if appropriate, recalculate the amount due.
15    The employer contributions required under this subsection
16(g-1) may be paid in the form of a lump sum within 90 days after
17receipt of the bill. If the employer contributions are not paid
18within 90 days after receipt of the bill, then interest shall
19be charged at a rate equal to the System's annual actuarially
20assumed rate of return on investment compounded annually from
21the 91st day after receipt of the bill. Payments must be
22concluded within 3 years after the employer's receipt of the
23bill.
24    This subsection (g-1) does not apply to (1) Tier 2 hybrid
25plan members and (2) Tier 2 defined benefit members who first
26participate under this Article on or after the implementation

 

 

SB3622- 14 -LRB100 22541 RPS 41439 b

1date of the Optional Hybrid Plan.
2    (h) This subsection (h) applies only to payments made or
3salary increases given on or after June 1, 2005 but before July
41, 2011. The changes made by Public Act 94-1057 shall not
5require the System to refund any payments received before July
631, 2006 (the effective date of Public Act 94-1057).
7    When assessing payment for any amount due under subsection
8(g), the System shall exclude earnings increases paid to
9participants under contracts or collective bargaining
10agreements entered into, amended, or renewed before June 1,
112005.
12    When assessing payment for any amount due under subsection
13(g), the System shall exclude earnings increases paid to a
14participant at a time when the participant is 10 or more years
15from retirement eligibility under Section 15-135.
16    When assessing payment for any amount due under subsection
17(g), the System shall exclude earnings increases resulting from
18overload work, including a contract for summer teaching, or
19overtime when the employer has certified to the System, and the
20System has approved the certification, that: (i) in the case of
21overloads (A) the overload work is for the sole purpose of
22academic instruction in excess of the standard number of
23instruction hours for a full-time employee occurring during the
24academic year that the overload is paid and (B) the earnings
25increases are equal to or less than the rate of pay for
26academic instruction computed using the participant's current

 

 

SB3622- 15 -LRB100 22541 RPS 41439 b

1salary rate and work schedule; and (ii) in the case of
2overtime, the overtime was necessary for the educational
3mission.
4    When assessing payment for any amount due under subsection
5(g), the System shall exclude any earnings increase resulting
6from (i) a promotion for which the employee moves from one
7classification to a higher classification under the State
8Universities Civil Service System, (ii) a promotion in academic
9rank for a tenured or tenure-track faculty position, or (iii) a
10promotion that the Illinois Community College Board has
11recommended in accordance with subsection (k) of this Section.
12These earnings increases shall be excluded only if the
13promotion is to a position that has existed and been filled by
14a member for no less than one complete academic year and the
15earnings increase as a result of the promotion is an increase
16that results in an amount no greater than the average salary
17paid for other similar positions.
18    (i) When assessing payment for any amount due under
19subsection (g), the System shall exclude any salary increase
20described in subsection (h) of this Section given on or after
21July 1, 2011 but before July 1, 2014 under a contract or
22collective bargaining agreement entered into, amended, or
23renewed on or after June 1, 2005 but before July 1, 2011.
24Notwithstanding any other provision of this Section, any
25payments made or salary increases given after June 30, 2014
26shall be used in assessing payment for any amount due under

 

 

SB3622- 16 -LRB100 22541 RPS 41439 b

1subsection (g) of this Section.
2    (j) The System shall prepare a report and file copies of
3the report with the Governor and the General Assembly by
4January 1, 2007 that contains all of the following information:
5        (1) The number of recalculations required by the
6    changes made to this Section by Public Act 94-1057 for each
7    employer.
8        (2) The dollar amount by which each employer's
9    contribution to the System was changed due to
10    recalculations required by Public Act 94-1057.
11        (3) The total amount the System received from each
12    employer as a result of the changes made to this Section by
13    Public Act 94-4.
14        (4) The increase in the required State contribution
15    resulting from the changes made to this Section by Public
16    Act 94-1057.
17    (j-5) For academic years beginning on or after July 1,
182017, if the amount of a participant's earnings for any school
19year, determined on a full-time equivalent basis, exceeds the
20amount of the salary set for the Governor, the participant's
21employer shall pay to the System, in addition to all other
22payments required under this Section and in accordance with
23guidelines established by the System, an amount determined by
24the System to be equal to the employer normal cost, as
25established by the System and expressed as a total percentage
26of payroll, multiplied by the amount of earnings in excess of

 

 

SB3622- 17 -LRB100 22541 RPS 41439 b

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

 

 

SB3622- 18 -LRB100 22541 RPS 41439 b

1for recommending lists of promotional positions submitted to
2the Board by community colleges and for reviewing the
3promotional lists on an annual basis. When recommending
4promotional lists, the Board shall consider the similarity of
5the positions submitted to those positions recognized for State
6universities by the State Universities Civil Service System.
7The Illinois Community College Board shall file a copy of its
8findings with the System. The System shall consider the
9findings of the Illinois Community College Board when making
10determinations under this Section. The System shall not exclude
11any earnings increases resulting from a promotion when the
12promotion was not submitted by a community college. Nothing in
13this subsection (k) shall require any community college to
14submit any information to the Community College Board.
15    (l) 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    (m) For purposes of determining the required State

 

 

SB3622- 19 -LRB100 22541 RPS 41439 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. 99-897, eff. 1-1-17; 100-23, eff. 7-6-17;
5100-587, eff. 6-4-18.)
 
6    (40 ILCS 5/16-158)   (from Ch. 108 1/2, par. 16-158)
7    Sec. 16-158. Contributions by State and other employing
8units.
9    (a) The State shall make contributions to the System by
10means of appropriations from the Common School Fund and other
11State funds of amounts which, together with other employer
12contributions, employee contributions, investment income, and
13other income, will be sufficient to meet the cost of
14maintaining and administering the System on a 90% funded basis
15in accordance with actuarial recommendations.
16    The Board shall determine the amount of State contributions
17required for each fiscal year on the basis of the actuarial
18tables and other assumptions adopted by the Board and the
19recommendations of the actuary, using the formula in subsection
20(b-3).
21    (a-1) Annually, on or before November 15 until November 15,
222011, the Board shall certify to the Governor the amount of the
23required State contribution for the coming fiscal year. The
24certification under this subsection (a-1) shall include a copy
25of the actuarial recommendations upon which it is based and

 

 

SB3622- 20 -LRB100 22541 RPS 41439 b

1shall specifically identify the System's projected State
2normal cost for that fiscal year.
3    On or before May 1, 2004, the Board shall recalculate and
4recertify to the Governor the amount of the required State
5contribution to the System for State fiscal year 2005, taking
6into account the amounts appropriated to and received by the
7System under subsection (d) of Section 7.2 of the General
8Obligation Bond Act.
9    On or before July 1, 2005, the Board shall recalculate and
10recertify to the Governor the amount of the required State
11contribution to the System for State fiscal year 2006, taking
12into account the changes in required State contributions made
13by Public Act 94-4.
14    On or before April 1, 2011, the Board shall recalculate and
15recertify to the Governor the amount of the required State
16contribution to the System for State fiscal year 2011, applying
17the changes made by Public Act 96-889 to the System's assets
18and liabilities as of June 30, 2009 as though Public Act 96-889
19was approved on that date.
20    (a-5) On or before November 1 of each year, beginning
21November 1, 2012, the Board shall submit to the State Actuary,
22the Governor, and the General Assembly a proposed certification
23of the amount of the required State contribution to the System
24for the next fiscal year, along with all of the actuarial
25assumptions, calculations, and data upon which that proposed
26certification is based. On or before January 1 of each year,

 

 

SB3622- 21 -LRB100 22541 RPS 41439 b

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

 

 

SB3622- 22 -LRB100 22541 RPS 41439 b

1following the State Actuary's recommended changes, and the
2fiscal impact of not following the State Actuary's recommended
3changes on the required State contribution.
4    (a-15) On or after June 15, 2019, but no later than June
530, 2019, the Board shall recalculate and recertify to the
6Governor and the General Assembly the amount of the State
7contribution to the System for State fiscal year 2019, taking
8into account the changes in required State contributions made
9by this amendatory Act of the 100th General Assembly. The
10recalculation shall be made using assumptions adopted by the
11Board for the original fiscal year 2019 certification. The
12monthly voucher for the 12th month of fiscal year 2019 shall be
13paid by the Comptroller after the recertification required
14pursuant to this subsection is submitted to the Governor,
15Comptroller, and General Assembly. The recertification
16submitted to the General Assembly shall be filed with the Clerk
17of the House of Representatives and the Secretary of the Senate
18in electronic form only, in the manner that the Clerk and the
19Secretary shall direct.
20    (b) Through State fiscal year 1995, the State contributions
21shall be paid to the System in accordance with Section 18-7 of
22the School Code.
23    (b-1) Beginning in State fiscal year 1996, on the 15th day
24of each month, or as soon thereafter as may be practicable, the
25Board shall submit vouchers for payment of State contributions
26to the System, in a total monthly amount of one-twelfth of the

 

 

SB3622- 23 -LRB100 22541 RPS 41439 b

1required annual State contribution certified under subsection
2(a-1). From March 5, 2004 (the effective date of Public Act
393-665) through June 30, 2004, the Board shall not submit
4vouchers for the remainder of fiscal year 2004 in excess of the
5fiscal year 2004 certified contribution amount determined
6under this Section after taking into consideration the transfer
7to the System under subsection (a) of Section 6z-61 of the
8State Finance Act. These vouchers shall be paid by the State
9Comptroller and Treasurer by warrants drawn on the funds
10appropriated to the System for that fiscal year.
11    If in any month the amount remaining unexpended from all
12other appropriations to the System for the applicable fiscal
13year (including the appropriations to the System under Section
148.12 of the State Finance Act and Section 1 of the State
15Pension Funds Continuing Appropriation Act) is less than the
16amount lawfully vouchered under this subsection, the
17difference shall be paid from the Common School Fund under the
18continuing appropriation authority provided in Section 1.1 of
19the State Pension Funds Continuing Appropriation Act.
20    (b-2) Allocations from the Common School Fund apportioned
21to school districts not coming under this System shall not be
22diminished or affected by the provisions of this Article.
23    (b-3) For State fiscal years 2012 through 2045, the minimum
24contribution to the System to be made by the State for each
25fiscal year shall be an amount determined by the System to be
26sufficient to bring the total assets of the System up to 90% of

 

 

SB3622- 24 -LRB100 22541 RPS 41439 b

1the total actuarial liabilities of the System by the end of
2State fiscal year 2045. In making these determinations, the
3required State contribution shall be calculated each year as a
4level percentage of payroll over the years remaining to and
5including fiscal year 2045 and shall be determined under the
6projected unit credit actuarial cost method.
7    For each of State fiscal years 2018, 2019, and 2020, the
8State shall make an additional contribution to the System equal
9to 2% of the total payroll of each employee who is deemed to
10have elected the benefits under Section 1-161 or who has made
11the election under subsection (c) of Section 1-161.
12    A change in an actuarial or investment assumption that
13increases or decreases the required State contribution and
14first applies in State fiscal year 2018 or thereafter shall be
15implemented in equal annual amounts over a 5-year period
16beginning in the State fiscal year in which the actuarial
17change first applies to the required State contribution.
18    A change in an actuarial or investment assumption that
19increases or decreases the required State contribution and
20first applied to the State contribution in fiscal year 2014,
212015, 2016, or 2017 shall be implemented:
22        (i) as already applied in State fiscal years before
23    2018; and
24        (ii) in the portion of the 5-year period beginning in
25    the State fiscal year in which the actuarial change first
26    applied that occurs in State fiscal year 2018 or

 

 

SB3622- 25 -LRB100 22541 RPS 41439 b

1    thereafter, by calculating the change in equal annual
2    amounts over that 5-year period and then implementing it at
3    the resulting annual rate in each of the remaining fiscal
4    years in that 5-year period.
5    For State fiscal years 1996 through 2005, the State
6contribution to the System, as a percentage of the applicable
7employee payroll, shall be increased in equal annual increments
8so that by State fiscal year 2011, the State is contributing at
9the rate required under this Section; except that in the
10following specified State fiscal years, the State contribution
11to the System shall not be less than the following indicated
12percentages of the applicable employee payroll, even if the
13indicated percentage will produce a State contribution in
14excess of the amount otherwise required under this subsection
15and subsection (a), and notwithstanding any contrary
16certification made under subsection (a-1) before May 27, 1998
17(the effective date of Public Act 90-582): 10.02% in FY 1999;
1810.77% in FY 2000; 11.47% in FY 2001; 12.16% in FY 2002; 12.86%
19in FY 2003; and 13.56% in FY 2004.
20    Notwithstanding any other provision of this Article, the
21total required State contribution for State fiscal year 2006 is
22$534,627,700.
23    Notwithstanding any other provision of this Article, the
24total required State contribution for State fiscal year 2007 is
25$738,014,500.
26    For each of State fiscal years 2008 through 2009, the State

 

 

SB3622- 26 -LRB100 22541 RPS 41439 b

1contribution to the System, as a percentage of the applicable
2employee payroll, shall be increased in equal annual increments
3from the required State contribution for State fiscal year
42007, so that by State fiscal year 2011, the State is
5contributing at the rate otherwise required under this Section.
6    Notwithstanding any other provision of this Article, the
7total required State contribution for State fiscal year 2010 is
8$2,089,268,000 and shall be made from the proceeds of bonds
9sold in fiscal year 2010 pursuant to Section 7.2 of the General
10Obligation Bond Act, less (i) the pro rata share of bond sale
11expenses determined by the System's share of total bond
12proceeds, (ii) any amounts received from the Common School Fund
13in fiscal year 2010, and (iii) any reduction in bond proceeds
14due to the issuance of discounted bonds, if applicable.
15    Notwithstanding any other provision of this Article, the
16total required State contribution for State fiscal year 2011 is
17the amount recertified by the System on or before April 1, 2011
18pursuant to subsection (a-1) of this Section and shall be made
19from the proceeds of bonds sold in fiscal year 2011 pursuant to
20Section 7.2 of the General Obligation Bond Act, less (i) the
21pro rata share of bond sale expenses determined by the System's
22share of total bond proceeds, (ii) any amounts received from
23the Common School Fund in fiscal year 2011, and (iii) any
24reduction in bond proceeds due to the issuance of discounted
25bonds, if applicable. This amount shall include, in addition to
26the amount certified by the System, an amount necessary to meet

 

 

SB3622- 27 -LRB100 22541 RPS 41439 b

1employer contributions required by the State as an employer
2under paragraph (e) of this Section, which may also be used by
3the System for contributions required by paragraph (a) of
4Section 16-127.
5    Beginning in State fiscal year 2046, the minimum State
6contribution for each fiscal year shall be the amount needed to
7maintain the total assets of the System at 90% of the total
8actuarial liabilities of the System.
9    Amounts received by the System pursuant to Section 25 of
10the Budget Stabilization Act or Section 8.12 of the State
11Finance Act in any fiscal year do not reduce and do not
12constitute payment of any portion of the minimum State
13contribution required under this Article in that fiscal year.
14Such amounts shall not reduce, and shall not be included in the
15calculation of, the required State contributions under this
16Article in any future year until the System has reached a
17funding ratio of at least 90%. A reference in this Article to
18the "required State contribution" or any substantially similar
19term does not include or apply to any amounts payable to the
20System under Section 25 of the Budget Stabilization Act.
21    Notwithstanding any other provision of this Section, the
22required State contribution for State fiscal year 2005 and for
23fiscal year 2008 and each fiscal year thereafter, as calculated
24under this Section and certified under subsection (a-1), shall
25not exceed an amount equal to (i) the amount of the required
26State contribution that would have been calculated under this

 

 

SB3622- 28 -LRB100 22541 RPS 41439 b

1Section for that fiscal year if the System had not received any
2payments under subsection (d) of Section 7.2 of the General
3Obligation Bond Act, minus (ii) the portion of the State's
4total debt service payments for that fiscal year on the bonds
5issued in fiscal year 2003 for the purposes of that Section
67.2, as determined and certified by the Comptroller, that is
7the same as the System's portion of the total moneys
8distributed under subsection (d) of Section 7.2 of the General
9Obligation Bond Act. In determining this maximum for State
10fiscal years 2008 through 2010, however, the amount referred to
11in item (i) shall be increased, as a percentage of the
12applicable employee payroll, in equal increments calculated
13from the sum of the required State contribution for State
14fiscal year 2007 plus the applicable portion of the State's
15total debt service payments for fiscal year 2007 on the bonds
16issued in fiscal year 2003 for the purposes of Section 7.2 of
17the General Obligation Bond Act, so that, by State fiscal year
182011, the State is contributing at the rate otherwise required
19under this Section.
20    (b-4) Beginning in fiscal year 2018, each employer under
21this Article shall pay to the System a required contribution
22determined as a percentage of projected payroll and sufficient
23to produce an annual amount equal to:
24        (i) for each of fiscal years 2018, 2019, and 2020, the
25    defined benefit normal cost of the defined benefit plan,
26    less the employee contribution, for each employee of that

 

 

SB3622- 29 -LRB100 22541 RPS 41439 b

1    employer who has elected or who is deemed to have elected
2    the benefits under Section 1-161 or who has made the
3    election under subsection (b) of Section 1-161; for fiscal
4    year 2021 and each fiscal year thereafter, the defined
5    benefit normal cost of the defined benefit plan, less the
6    employee contribution, plus 2%, for each employee of that
7    employer who has elected or who is deemed to have elected
8    the benefits under Section 1-161 or who has made the
9    election under subsection (b) of Section 1-161; plus
10        (ii) the amount required for that fiscal year to
11    amortize any unfunded actuarial accrued liability
12    associated with the present value of liabilities
13    attributable to the employer's account under Section
14    16-158.3, determined as a level percentage of payroll over
15    a 30-year rolling amortization period.
16    In determining contributions required under item (i) of
17this subsection, the System shall determine an aggregate rate
18for all employers, expressed as a percentage of projected
19payroll.
20    In determining the contributions required under item (ii)
21of this subsection, the amount shall be computed by the System
22on the basis of the actuarial assumptions and tables used in
23the most recent actuarial valuation of the System that is
24available at the time of the computation.
25    The contributions required under this subsection (b-4)
26shall be paid by an employer concurrently with that employer's

 

 

SB3622- 30 -LRB100 22541 RPS 41439 b

1payroll payment period. The State, as the actual employer of an
2employee, shall make the required contributions under this
3subsection.
4    (c) Payment of the required State contributions and of all
5pensions, retirement annuities, death benefits, refunds, and
6other benefits granted under or assumed by this System, and all
7expenses in connection with the administration and operation
8thereof, are obligations of the State.
9    If members are paid from special trust or federal funds
10which are administered by the employing unit, whether school
11district or other unit, the employing unit shall pay to the
12System from such funds the full accruing retirement costs based
13upon that service, which, beginning July 1, 2017, shall be at a
14rate, expressed as a percentage of salary, equal to the total
15employer's normal cost, expressed as a percentage of payroll,
16as determined by the System. Employer contributions, based on
17salary paid to members from federal funds, may be forwarded by
18the distributing agency of the State of Illinois to the System
19prior to allocation, in an amount determined in accordance with
20guidelines established by such agency and the System. Any
21contribution for fiscal year 2015 collected as a result of the
22change made by Public Act 98-674 shall be considered a State
23contribution under subsection (b-3) of this Section.
24    (d) Effective July 1, 1986, any employer of a teacher as
25defined in paragraph (8) of Section 16-106 shall pay the
26employer's normal cost of benefits based upon the teacher's

 

 

SB3622- 31 -LRB100 22541 RPS 41439 b

1service, in addition to employee contributions, as determined
2by the System. Such employer contributions shall be forwarded
3monthly in accordance with guidelines established by the
4System.
5    However, with respect to benefits granted under Section
616-133.4 or 16-133.5 to a teacher as defined in paragraph (8)
7of Section 16-106, the employer's contribution shall be 12%
8(rather than 20%) of the member's highest annual salary rate
9for each year of creditable service granted, and the employer
10shall also pay the required employee contribution on behalf of
11the teacher. For the purposes of Sections 16-133.4 and
1216-133.5, a teacher as defined in paragraph (8) of Section
1316-106 who is serving in that capacity while on leave of
14absence from another employer under this Article shall not be
15considered an employee of the employer from which the teacher
16is on leave.
17    (e) Beginning July 1, 1998, every employer of a teacher
18shall pay to the System an employer contribution computed as
19follows:
20        (1) Beginning July 1, 1998 through June 30, 1999, the
21    employer contribution shall be equal to 0.3% of each
22    teacher's salary.
23        (2) Beginning July 1, 1999 and thereafter, the employer
24    contribution shall be equal to 0.58% of each teacher's
25    salary.
26The school district or other employing unit may pay these

 

 

SB3622- 32 -LRB100 22541 RPS 41439 b

1employer contributions out of any source of funding available
2for that purpose and shall forward the contributions to the
3System on the schedule established for the payment of member
4contributions.
5    These employer contributions are intended to offset a
6portion of the cost to the System of the increases in
7retirement benefits resulting from Public Act 90-582.
8    Each employer of teachers is entitled to a credit against
9the contributions required under this subsection (e) with
10respect to salaries paid to teachers for the period January 1,
112002 through June 30, 2003, equal to the amount paid by that
12employer under subsection (a-5) of Section 6.6 of the State
13Employees Group Insurance Act of 1971 with respect to salaries
14paid to teachers for that period.
15    The additional 1% employee contribution required under
16Section 16-152 by Public Act 90-582 is the responsibility of
17the teacher and not the teacher's employer, unless the employer
18agrees, through collective bargaining or otherwise, to make the
19contribution on behalf of the teacher.
20    If an employer is required by a contract in effect on May
211, 1998 between the employer and an employee organization to
22pay, on behalf of all its full-time employees covered by this
23Article, all mandatory employee contributions required under
24this Article, then the employer shall be excused from paying
25the employer contribution required under this subsection (e)
26for the balance of the term of that contract. The employer and

 

 

SB3622- 33 -LRB100 22541 RPS 41439 b

1the employee organization shall jointly certify to the System
2the existence of the contractual requirement, in such form as
3the System may prescribe. This exclusion shall cease upon the
4termination, extension, or renewal of the contract at any time
5after May 1, 1998.
6    (f) If For school years beginning on or after June 1, 2005
7and before July 1, 2018 and for salary paid to a teacher under
8a contract or collective bargaining agreement entered into,
9amended, or renewed before the effective date of this
10amendatory Act of the 100th General Assembly, if the amount of
11a teacher's salary for any school year used to determine final
12average salary exceeds the member's annual full-time salary
13rate with the same employer for the previous school year by
14more than 6%, the teacher's employer shall pay to the System,
15in addition to all other payments required under this Section
16and in accordance with guidelines established by the System,
17the present value of the increase in benefits resulting from
18the portion of the increase in salary that is in excess of 6%.
19This present value shall be computed by the System on the basis
20of the actuarial assumptions and tables used in the most recent
21actuarial valuation of the System that is available at the time
22of the computation. If a teacher's salary for the 2005-2006
23school year is used to determine final average salary under
24this subsection (f), then the changes made to this subsection
25(f) by Public Act 94-1057 shall apply in calculating whether
26the increase in his or her salary is in excess of 6%. For the

 

 

SB3622- 34 -LRB100 22541 RPS 41439 b

1purposes of this Section, change in employment under Section
210-21.12 of the School Code on or after June 1, 2005 shall
3constitute a change in employer. The System may require the
4employer to provide any pertinent information or
5documentation. The changes made to this subsection (f) by
6Public Act 94-1111 apply without regard to whether the teacher
7was in service on or after its effective date.
8    Whenever it determines that a payment is or may be required
9under this subsection, the System shall calculate the amount of
10the payment and bill the employer for that amount. The bill
11shall specify the calculations used to determine the amount
12due. If the employer disputes the amount of the bill, it may,
13within 30 days after receipt of the bill, apply to the System
14in writing for a recalculation. The application must specify in
15detail the grounds of the dispute and, if the employer asserts
16that the calculation is subject to subsection (g) or (h) of
17this Section or that subsection (f-1) of this Section applies,
18must include an affidavit setting forth and attesting to all
19facts within the employer's knowledge that are pertinent to the
20applicability of that subsection. Upon receiving a timely
21application for recalculation, the System shall review the
22application and, if appropriate, recalculate the amount due.
23    The employer contributions required under this subsection
24(f) may be paid in the form of a lump sum within 90 days after
25receipt of the bill. If the employer contributions are not paid
26within 90 days after receipt of the bill, then interest will be

 

 

SB3622- 35 -LRB100 22541 RPS 41439 b

1charged at a rate equal to the System's annual actuarially
2assumed rate of return on investment compounded annually from
3the 91st day after receipt of the bill. Payments must be
4concluded within 3 years after the employer's receipt of the
5bill.
6    (f-1) (Blank). For school years beginning on or after July
71, 2018 and for salary paid to a teacher under a contract or
8collective bargaining agreement entered into, amended, or
9renewed on or after the effective date of this amendatory Act
10of the 100th General Assembly, if the amount of a teacher's
11salary for any school year used to determine final average
12salary exceeds the member's annual full-time salary rate with
13the same employer for the previous school year by more than 3%,
14then the teacher's employer shall pay to the System, in
15addition to all other payments required under this Section and
16in accordance with guidelines established by the System, the
17present value of the increase in benefits resulting from the
18portion of the increase in salary that is in excess of 3%. This
19present value shall be computed by the System on the basis of
20the actuarial assumptions and tables used in the most recent
21actuarial valuation of the System that is available at the time
22of the computation. The System may require the employer to
23provide any pertinent information or documentation.
24    Whenever it determines that a payment is or may be required
25under this subsection (f-1), the System shall calculate the
26amount of the payment and bill the employer for that amount.

 

 

SB3622- 36 -LRB100 22541 RPS 41439 b

1The bill shall specify the calculations used to determine the
2amount due. If the employer disputes the amount of the bill, it
3shall, 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 subsection (f) of this Section applies,
7must include an affidavit setting forth and attesting to all
8facts within the employer's knowledge that are pertinent to the
9applicability of subsection (f). Upon receiving a timely
10application for recalculation, the System shall review the
11application and, if appropriate, recalculate the amount due.
12    The employer contributions required under this subsection
13(f-1) may be paid in the form of a lump sum within 90 days after
14receipt of the bill. If the employer contributions are not paid
15within 90 days after receipt of the bill, then interest shall
16be charged at a rate equal to the System's annual actuarially
17assumed rate of return on investment compounded annually from
18the 91st day after receipt of the bill. Payments must be
19concluded within 3 years after the employer's receipt of the
20bill.
21    (g) This subsection (g) applies only to payments made or
22salary increases given on or after June 1, 2005 but before July
231, 2011. The changes made by Public Act 94-1057 shall not
24require the System to refund any payments received before July
2531, 2006 (the effective date of Public Act 94-1057).
26    When assessing payment for any amount due under subsection

 

 

SB3622- 37 -LRB100 22541 RPS 41439 b

1(f), the System shall exclude salary increases paid to teachers
2under contracts or collective bargaining agreements entered
3into, amended, or renewed before June 1, 2005.
4    When assessing payment for any amount due under subsection
5(f), the System shall exclude salary increases paid to a
6teacher at a time when the teacher is 10 or more years from
7retirement eligibility under Section 16-132 or 16-133.2.
8    When assessing payment for any amount due under subsection
9(f), the System shall exclude salary increases resulting from
10overload work, including summer school, when the school
11district has certified to the System, and the System has
12approved the certification, that (i) the overload work is for
13the sole purpose of classroom instruction in excess of the
14standard number of classes for a full-time teacher in a school
15district during a school year and (ii) the salary increases are
16equal to or less than the rate of pay for classroom instruction
17computed on the teacher's current salary and work schedule.
18    When assessing payment for any amount due under subsection
19(f), the System shall exclude a salary increase resulting from
20a promotion (i) for which the employee is required to hold a
21certificate or supervisory endorsement issued by the State
22Teacher Certification Board that is a different certification
23or supervisory endorsement than is required for the teacher's
24previous position and (ii) to a position that has existed and
25been filled by a member for no less than one complete academic
26year and the salary increase from the promotion is an increase

 

 

SB3622- 38 -LRB100 22541 RPS 41439 b

1that results in an amount no greater than the lesser of the
2average salary paid for other similar positions in the district
3requiring the same certification or the amount stipulated in
4the collective bargaining agreement for a similar position
5requiring the same certification.
6    When assessing payment for any amount due under subsection
7(f), the System shall exclude any payment to the teacher from
8the State of Illinois or the State Board of Education over
9which the employer does not have discretion, notwithstanding
10that the payment is included in the computation of final
11average salary.
12    (h) When assessing payment for any amount due under
13subsection (f), the System shall exclude any salary increase
14described in subsection (g) of this Section given on or after
15July 1, 2011 but before July 1, 2014 under a contract or
16collective bargaining agreement entered into, amended, or
17renewed on or after June 1, 2005 but before July 1, 2011.
18Notwithstanding any other provision of this Section, any
19payments made or salary increases given after June 30, 2014
20shall be used in assessing payment for any amount due under
21subsection (f) of this Section.
22    (i) The System shall prepare a report and file copies of
23the report with the Governor and the General Assembly by
24January 1, 2007 that contains all of the following information:
25        (1) The number of recalculations required by the
26    changes made to this Section by Public Act 94-1057 for each

 

 

SB3622- 39 -LRB100 22541 RPS 41439 b

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

 

 

SB3622- 40 -LRB100 22541 RPS 41439 b

1    Whenever it determines that a payment is or may be required
2under this subsection, the System shall calculate the amount of
3the payment and bill the employer for that amount. The bill
4shall specify the calculations used to determine the amount
5due. If the employer disputes the amount of the bill, it may,
6within 30 days after receipt of the bill, apply to the System
7in writing for a recalculation. The application must specify in
8detail the grounds of the dispute. Upon receiving a timely
9application for recalculation, the System shall review the
10application and, if appropriate, recalculate the amount due.
11    The employer contributions required under this subsection
12may be paid in the form of a lump sum within 90 days after
13receipt of the bill. If the employer contributions are not paid
14within 90 days after receipt of the bill, then interest will be
15charged at a rate equal to the System's annual actuarially
16assumed rate of return on investment compounded annually from
17the 91st day after receipt of the bill. Payments must be
18concluded within 3 years after the employer's receipt of the
19bill.
20    (j) For purposes of determining the required State
21contribution to the System, the value of the System's assets
22shall be equal to the actuarial value of the System's assets,
23which shall be calculated as follows:
24    As of June 30, 2008, the actuarial value of the System's
25assets shall be equal to the market value of the assets as of
26that date. In determining the actuarial value of the System's

 

 

SB3622- 41 -LRB100 22541 RPS 41439 b

1assets for fiscal years after June 30, 2008, any actuarial
2gains or losses from investment return incurred in a fiscal
3year shall be recognized in equal annual amounts over the
45-year period following that fiscal year.
5    (k) For purposes of determining the required State
6contribution to the system for a particular year, the actuarial
7value of assets shall be assumed to earn a rate of return equal
8to the system's actuarially assumed rate of return.
9(Source: P.A. 100-23, eff. 7-6-17; 100-340, eff. 8-25-17;
10100-587, eff. 6-4-18.)
 
11    Section 99. Effective date. This Act takes effect upon
12becoming law.