97TH GENERAL ASSEMBLY
State of Illinois
2011 and 2012
SB2187

 

Introduced 2/10/2011, by Sen. James F. Clayborne, Jr.

 

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
30 ILCS 805/8.35 new

    Amends the Downstate Teachers and State Universities Articles of the Illinois Pension Code. Extends, by 5 years, the period during which certain types of salary increases may be excluded from the calculation of a 6% salary increase above which employees must make additional contributions. Amends the State Mandates Act to require implementation without reimbursement. Effective immediately.


LRB097 10379 JDS 50594 b

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

 

 

A BILL FOR

 

SB2187LRB097 10379 JDS 50594 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 2011 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

 

 

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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 State fiscal years 1996 through 2005, the State
8contribution to the System, as a percentage of the applicable
9employee payroll, shall be increased in equal annual increments
10so that by State fiscal year 2011, the State is contributing at
11the rate required under this Section.
12    Notwithstanding any other provision of this Article, the
13total required State contribution for State fiscal year 2006 is
14$166,641,900.
15    Notwithstanding any other provision of this Article, the
16total required State contribution for State fiscal year 2007 is
17$252,064,100.
18    For each of State fiscal years 2008 through 2009, the State
19contribution to the System, as a percentage of the applicable
20employee payroll, shall be increased in equal annual increments
21from the required State contribution for State fiscal year
222007, so that by State fiscal year 2011, the State is
23contributing at the rate otherwise required under this Section.
24    Notwithstanding any other provision of this Article, the
25total required State contribution for State fiscal year 2010 is
26$702,514,000 and shall be made from the State Pensions Fund and

 

 

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1proceeds of bonds sold in fiscal year 2010 pursuant to Section
27.2 of the General Obligation Bond Act, less (i) the pro rata
3share of bond sale expenses determined by the System's share of
4total bond proceeds, (ii) any amounts received from the General
5Revenue Fund in fiscal year 2010, (iii) any reduction in bond
6proceeds due to the issuance of discounted bonds, if
7applicable.
8    Beginning in State fiscal year 2046, the minimum State
9contribution for each fiscal year shall be the amount needed to
10maintain the total assets of the System at 90% of the total
11actuarial liabilities of the System.
12    Amounts received by the System pursuant to Section 25 of
13the Budget Stabilization Act or Section 8.12 of the State
14Finance Act in any fiscal year do not reduce and do not
15constitute payment of any portion of the minimum State
16contribution required under this Article in that fiscal year.
17Such amounts shall not reduce, and shall not be included in the
18calculation of, the required State contributions under this
19Article in any future year until the System has reached a
20funding ratio of at least 90%. A reference in this Article to
21the "required State contribution" or any substantially similar
22term does not include or apply to any amounts payable to the
23System under Section 25 of the Budget Stabilization Act.
24    Notwithstanding any other provision of this Section, the
25required State contribution for State fiscal year 2005 and for
26fiscal year 2008 and each fiscal year thereafter, as calculated

 

 

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1under this Section and certified under Section 15-165, shall
2not exceed an amount equal to (i) the amount of the required
3State contribution that would have been calculated under this
4Section for that fiscal year if the System had not received any
5payments under subsection (d) of Section 7.2 of the General
6Obligation Bond Act, minus (ii) the portion of the State's
7total debt service payments for that fiscal year on the bonds
8issued for the purposes of that Section 7.2, as determined and
9certified by the Comptroller, that is the same as the System's
10portion of the total moneys distributed under subsection (d) of
11Section 7.2 of the General Obligation Bond Act. In determining
12this maximum for State fiscal years 2008 through 2010, however,
13the amount referred to in item (i) shall be increased, as a
14percentage of the applicable employee payroll, in equal
15increments calculated from the sum of the required State
16contribution for State fiscal year 2007 plus the applicable
17portion of the State's total debt service payments for fiscal
18year 2007 on the bonds issued for the purposes of Section 7.2
19of the General Obligation Bond Act, so that, by State fiscal
20year 2011, the State is contributing at the rate otherwise
21required under this Section.
22    (b) If an employee is paid from trust or federal funds, the
23employer shall pay to the Board contributions from those funds
24which are sufficient to cover the accruing normal costs on
25behalf of the employee. However, universities having employees
26who are compensated out of local auxiliary funds, income funds,

 

 

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

 

 

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1funds, in accordance with actuarial procedures approved by the
2Board. State of Illinois contributions for employers receiving
3State appropriations for personal services shall be payable
4from appropriations made to the employers or to the System. The
5contributions for Class I community colleges covering earnings
6other than those paid from trust and federal funds, shall be
7payable solely from appropriations to the Illinois Community
8College Board or the System for employer contributions.
9    (d) Beginning in State fiscal year 1996, the required State
10contributions to the System shall be appropriated directly to
11the System and shall be payable through vouchers issued in
12accordance with subsection (c) of Section 15-165, except as
13provided in subsection (g).
14    (e) The State Comptroller shall draw warrants payable to
15the System upon proper certification by the System or by the
16employer in accordance with the appropriation laws and this
17Code.
18    (f) Normal costs under this Section means liability for
19pensions and other benefits which accrues to the System because
20of the credits earned for service rendered by the participants
21during the fiscal year and expenses of administering the
22System, but shall not include the principal of or any
23redemption premium or interest on any bonds issued by the Board
24or any expenses incurred or deposits required in connection
25therewith.
26    (g) If the amount of a participant's earnings for any

 

 

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

 

 

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1knowledge that are pertinent to the applicability of subsection
2(h) or (i). Upon receiving a timely application for
3recalculation, the System shall review the application and, if
4appropriate, recalculate the 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    (h) This subsection (h) applies only to payments made or
15salary increases given on or after June 1, 2005 but before July
161, 2016 2011. The changes made by Public Act 94-1057 shall not
17require the System to refund any payments received before July
1831, 2006 (the effective date of Public Act 94-1057).
19    When assessing payment for any amount due under subsection
20(g), the System shall exclude earnings increases paid to
21participants under contracts or collective bargaining
22agreements entered into, amended, or renewed before June 1,
232005.
24    When assessing payment for any amount due under subsection
25(g), the System shall exclude earnings increases paid to a
26participant at a time when the participant is 10 or more years

 

 

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1from retirement eligibility under Section 15-135.
2    When assessing payment for any amount due under subsection
3(g), the System shall exclude earnings increases resulting from
4overload work, including a contract for summer teaching, or
5overtime when the employer has certified to the System, and the
6System has approved the certification, that: (i) in the case of
7overloads (A) the overload work is for the sole purpose of
8academic instruction in excess of the standard number of
9instruction hours for a full-time employee occurring during the
10academic year that the overload is paid and (B) the earnings
11increases are equal to or less than the rate of pay for
12academic instruction computed using the participant's current
13salary rate and work schedule; and (ii) in the case of
14overtime, the overtime was necessary for the educational
15mission.
16    When assessing payment for any amount due under subsection
17(g), the System shall exclude any earnings increase resulting
18from (i) a promotion for which the employee moves from one
19classification to a higher classification under the State
20Universities Civil Service System, (ii) a promotion in academic
21rank for a tenured or tenure-track faculty position, or (iii) a
22promotion that the Illinois Community College Board has
23recommended in accordance with subsection (k) of this Section.
24These earnings increases shall be excluded only if the
25promotion is to a position that has existed and been filled by
26a member for no less than one complete academic year and the

 

 

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1earnings increase as a result of the promotion is an increase
2that results in an amount no greater than the average salary
3paid for other similar positions.
4    (i) When assessing payment for any amount due under
5subsection (g), the System shall exclude any salary increase
6described in subsection (h) of this Section given on or after
7July 1, 2016 2011 but before July 1, 2019 2014 under a contract
8or collective bargaining agreement entered into, amended, or
9renewed on or after June 1, 2005 but before July 1, 2016 2011.
10Notwithstanding any other provision of this Section, any
11payments made or salary increases given after June 30, 2019
122014 shall be used in assessing payment for any amount due
13under subsection (g) of this Section.
14    (j) The System shall prepare a report and file copies of
15the report with the Governor and the General Assembly by
16January 1, 2007 that contains all of the following information:
17        (1) The number of recalculations required by the
18    changes made to this Section by Public Act 94-1057 for each
19    employer.
20        (2) The dollar amount by which each employer's
21    contribution to the System was changed due to
22    recalculations required by Public Act 94-1057.
23        (3) The total amount the System received from each
24    employer as a result of the changes made to this Section by
25    Public Act 94-4.
26        (4) The increase in the required State contribution

 

 

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1    resulting from the changes made to this Section by Public
2    Act 94-1057.
3    (k) The Illinois Community College Board shall adopt rules
4for recommending lists of promotional positions submitted to
5the Board by community colleges and for reviewing the
6promotional lists on an annual basis. When recommending
7promotional lists, the Board shall consider the similarity of
8the positions submitted to those positions recognized for State
9universities by the State Universities Civil Service System.
10The Illinois Community College Board shall file a copy of its
11findings with the System. The System shall consider the
12findings of the Illinois Community College Board when making
13determinations under this Section. The System shall not exclude
14any earnings increases resulting from a promotion when the
15promotion was not submitted by a community college. Nothing in
16this subsection (k) shall require any community college to
17submit any information to the Community College Board.
18    (l) For purposes of determining the required State
19contribution to the System, the value of the System's assets
20shall be equal to the actuarial value of the System's assets,
21which shall be calculated as follows:
22    As of June 30, 2008, the actuarial value of the System's
23assets shall be equal to the market value of the assets as of
24that date. In determining the actuarial value of the System's
25assets for fiscal years after June 30, 2008, any actuarial
26gains or losses from investment return incurred in a fiscal

 

 

SB2187- 12 -LRB097 10379 JDS 50594 b

1year shall be recognized in equal annual amounts over the
25-year period following that fiscal year.
3    (m) For purposes of determining the required State
4contribution to the system for a particular year, the actuarial
5value of assets shall be assumed to earn a rate of return equal
6to the system's actuarially assumed rate of return.
7(Source: P.A. 95-331, eff. 8-21-07; 95-950, eff. 8-29-08;
896-43, eff. 7-15-09.)
 
9    (40 ILCS 5/16-158)   (from Ch. 108 1/2, par. 16-158)
10    Sec. 16-158. Contributions by State and other employing
11units.
12    (a) The State shall make contributions to the System by
13means of appropriations from the Common School Fund and other
14State funds of amounts which, together with other employer
15contributions, employee contributions, investment income, and
16other income, will be sufficient to meet the cost of
17maintaining and administering the System on a 90% funded basis
18in accordance with actuarial recommendations.
19    The Board shall determine the amount of State contributions
20required for each fiscal year on the basis of the actuarial
21tables and other assumptions adopted by the Board and the
22recommendations of the actuary, using the formula in subsection
23(b-3).
24    (a-1) Annually, on or before November 15, the Board shall
25certify to the Governor the amount of the required State

 

 

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1contribution for the coming fiscal year. The certification
2shall include a copy of the actuarial recommendations upon
3which it is based.
4    On or before May 1, 2004, the Board shall recalculate and
5recertify to the Governor the amount of the required State
6contribution to the System for State fiscal year 2005, taking
7into account the amounts appropriated to and received by the
8System under subsection (d) of Section 7.2 of the General
9Obligation Bond Act.
10    On or before July 1, 2005, the Board shall recalculate and
11recertify to the Governor the amount of the required State
12contribution to the System for State fiscal year 2006, taking
13into account the changes in required State contributions made
14by this amendatory Act of the 94th General Assembly.
15    (b) Through State fiscal year 1995, the State contributions
16shall be paid to the System in accordance with Section 18-7 of
17the School Code.
18    (b-1) Beginning in State fiscal year 1996, on the 15th day
19of each month, or as soon thereafter as may be practicable, the
20Board shall submit vouchers for payment of State contributions
21to the System, in a total monthly amount of one-twelfth of the
22required annual State contribution certified under subsection
23(a-1). From the effective date of this amendatory Act of the
2493rd General Assembly through June 30, 2004, the Board shall
25not submit vouchers for the remainder of fiscal year 2004 in
26excess of the fiscal year 2004 certified contribution amount

 

 

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1determined under this Section after taking into consideration
2the transfer to the System under subsection (a) of Section
36z-61 of the State Finance Act. These vouchers shall be paid by
4the State Comptroller and Treasurer by warrants drawn on the
5funds appropriated to the System for that fiscal year.
6    If in any month the amount remaining unexpended from all
7other appropriations to the System for the applicable fiscal
8year (including the appropriations to the System under Section
98.12 of the State Finance Act and Section 1 of the State
10Pension Funds Continuing Appropriation Act) is less than the
11amount lawfully vouchered under this subsection, the
12difference shall be paid from the Common School Fund under the
13continuing appropriation authority provided in Section 1.1 of
14the State Pension Funds Continuing Appropriation Act.
15    (b-2) Allocations from the Common School Fund apportioned
16to school districts not coming under this System shall not be
17diminished or affected by the provisions of this Article.
18    (b-3) For State fiscal years 2011 through 2045, the minimum
19contribution to the System to be made by the State for each
20fiscal year shall be an amount determined by the System to be
21sufficient to bring the total assets of the System up to 90% of
22the total actuarial liabilities of the System by the end of
23State fiscal year 2045. In making these determinations, the
24required State contribution shall be calculated each year as a
25level percentage of payroll over the years remaining to and
26including fiscal year 2045 and shall be determined under the

 

 

SB2187- 15 -LRB097 10379 JDS 50594 b

1projected unit credit actuarial cost method.
2    For State fiscal years 1996 through 2005, the State
3contribution to the System, as a percentage of the applicable
4employee payroll, shall be increased in equal annual increments
5so that by State fiscal year 2011, the State is contributing at
6the rate required under this Section; except that in the
7following specified State fiscal years, the State contribution
8to the System shall not be less than the following indicated
9percentages of the applicable employee payroll, even if the
10indicated percentage will produce a State contribution in
11excess of the amount otherwise required under this subsection
12and subsection (a), and notwithstanding any contrary
13certification made under subsection (a-1) before the effective
14date of this amendatory Act of 1998: 10.02% in FY 1999; 10.77%
15in FY 2000; 11.47% in FY 2001; 12.16% in FY 2002; 12.86% in FY
162003; and 13.56% in FY 2004.
17    Notwithstanding any other provision of this Article, the
18total required State contribution for State fiscal year 2006 is
19$534,627,700.
20    Notwithstanding any other provision of this Article, the
21total required State contribution for State fiscal year 2007 is
22$738,014,500.
23    For each of State fiscal years 2008 through 2009, the State
24contribution to the System, as a percentage of the applicable
25employee payroll, shall be increased in equal annual increments
26from the required State contribution for State fiscal year

 

 

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12007, so that by State fiscal year 2011, the State is
2contributing at the rate otherwise required under this Section.
3    Notwithstanding any other provision of this Article, the
4total required State contribution for State fiscal year 2010 is
5$2,089,268,000 and shall be made from the proceeds of bonds
6sold in fiscal year 2010 pursuant to Section 7.2 of the General
7Obligation Bond Act, less (i) the pro rata share of bond sale
8expenses determined by the System's share of total bond
9proceeds, (ii) any amounts received from the Common School Fund
10in fiscal year 2010, and (iii) any reduction in bond proceeds
11due to the issuance of discounted bonds, if applicable.
12    Beginning in State fiscal year 2046, the minimum State
13contribution for each fiscal year shall be the amount needed to
14maintain the total assets of the System at 90% of the total
15actuarial liabilities of the System.
16    Amounts received by the System pursuant to Section 25 of
17the Budget Stabilization Act or Section 8.12 of the State
18Finance Act in any fiscal year do not reduce and do not
19constitute payment of any portion of the minimum State
20contribution required under this Article in that fiscal year.
21Such amounts shall not reduce, and shall not be included in the
22calculation of, the required State contributions under this
23Article in any future year until the System has reached a
24funding ratio of at least 90%. A reference in this Article to
25the "required State contribution" or any substantially similar
26term does not include or apply to any amounts payable to the

 

 

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1System under Section 25 of the Budget Stabilization Act.
2    Notwithstanding any other provision of this Section, the
3required State contribution for State fiscal year 2005 and for
4fiscal year 2008 and each fiscal year thereafter, as calculated
5under this Section and certified under subsection (a-1), shall
6not exceed an amount equal to (i) the amount of the required
7State contribution that would have been calculated under this
8Section for that fiscal year if the System had not received any
9payments under subsection (d) of Section 7.2 of the General
10Obligation Bond Act, minus (ii) the portion of the State's
11total debt service payments for that fiscal year on the bonds
12issued for the purposes of that Section 7.2, as determined and
13certified by the Comptroller, that is the same as the System's
14portion of the total moneys distributed under subsection (d) of
15Section 7.2 of the General Obligation Bond Act. In determining
16this maximum for State fiscal years 2008 through 2010, however,
17the amount referred to in item (i) shall be increased, as a
18percentage of the applicable employee payroll, in equal
19increments calculated from the sum of the required State
20contribution for State fiscal year 2007 plus the applicable
21portion of the State's total debt service payments for fiscal
22year 2007 on the bonds issued for the purposes of Section 7.2
23of the General Obligation Bond Act, so that, by State fiscal
24year 2011, the State is contributing at the rate otherwise
25required under this Section.
26    (c) Payment of the required State contributions and of all

 

 

SB2187- 18 -LRB097 10379 JDS 50594 b

1pensions, retirement annuities, death benefits, refunds, and
2other benefits granted under or assumed by this System, and all
3expenses in connection with the administration and operation
4thereof, are obligations of the State.
5    If members are paid from special trust or federal funds
6which are administered by the employing unit, whether school
7district or other unit, the employing unit shall pay to the
8System from such funds the full accruing retirement costs based
9upon that service, as determined by the System. Employer
10contributions, based on salary paid to members from federal
11funds, may be forwarded by the distributing agency of the State
12of Illinois to the System prior to allocation, in an amount
13determined in accordance with guidelines established by such
14agency and the System.
15    (d) Effective July 1, 1986, any employer of a teacher as
16defined in paragraph (8) of Section 16-106 shall pay the
17employer's normal cost of benefits based upon the teacher's
18service, in addition to employee contributions, as determined
19by the System. Such employer contributions shall be forwarded
20monthly in accordance with guidelines established by the
21System.
22    However, with respect to benefits granted under Section
2316-133.4 or 16-133.5 to a teacher as defined in paragraph (8)
24of Section 16-106, the employer's contribution shall be 12%
25(rather than 20%) of the member's highest annual salary rate
26for each year of creditable service granted, and the employer

 

 

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1shall also pay the required employee contribution on behalf of
2the teacher. For the purposes of Sections 16-133.4 and
316-133.5, a teacher as defined in paragraph (8) of Section
416-106 who is serving in that capacity while on leave of
5absence from another employer under this Article shall not be
6considered an employee of the employer from which the teacher
7is on leave.
8    (e) Beginning July 1, 1998, every employer of a teacher
9shall pay to the System an employer contribution computed as
10follows:
11        (1) Beginning July 1, 1998 through June 30, 1999, the
12    employer contribution shall be equal to 0.3% of each
13    teacher's salary.
14        (2) Beginning July 1, 1999 and thereafter, the employer
15    contribution shall be equal to 0.58% of each teacher's
16    salary.
17The school district or other employing unit may pay these
18employer contributions out of any source of funding available
19for that purpose and shall forward the contributions to the
20System on the schedule established for the payment of member
21contributions.
22    These employer contributions are intended to offset a
23portion of the cost to the System of the increases in
24retirement benefits resulting from this amendatory Act of 1998.
25    Each employer of teachers is entitled to a credit against
26the contributions required under this subsection (e) with

 

 

SB2187- 20 -LRB097 10379 JDS 50594 b

1respect to salaries paid to teachers for the period January 1,
22002 through June 30, 2003, equal to the amount paid by that
3employer under subsection (a-5) of Section 6.6 of the State
4Employees Group Insurance Act of 1971 with respect to salaries
5paid to teachers for that period.
6    The additional 1% employee contribution required under
7Section 16-152 by this amendatory Act of 1998 is the
8responsibility of the teacher and not the teacher's employer,
9unless the employer agrees, through collective bargaining or
10otherwise, to make the contribution on behalf of the teacher.
11    If an employer is required by a contract in effect on May
121, 1998 between the employer and an employee organization to
13pay, on behalf of all its full-time employees covered by this
14Article, all mandatory employee contributions required under
15this Article, then the employer shall be excused from paying
16the employer contribution required under this subsection (e)
17for the balance of the term of that contract. The employer and
18the employee organization shall jointly certify to the System
19the existence of the contractual requirement, in such form as
20the System may prescribe. This exclusion shall cease upon the
21termination, extension, or renewal of the contract at any time
22after May 1, 1998.
23    (f) If the amount of a teacher's salary for any school year
24used to determine final average salary exceeds the member's
25annual full-time salary rate with the same employer for the
26previous school year by more than 6%, the teacher's employer

 

 

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1shall pay to the System, in addition to all other payments
2required under this Section and in accordance with guidelines
3established by the System, the present value of the increase in
4benefits resulting from the portion of the increase in salary
5that is in excess of 6%. This present value shall be computed
6by the System on the basis of the actuarial assumptions and
7tables used in the most recent actuarial valuation of the
8System that is available at the time of the computation. If a
9teacher's salary for the 2005-2006 school year is used to
10determine final average salary under this subsection (f), then
11the changes made to this subsection (f) by Public Act 94-1057
12shall apply in calculating whether the increase in his or her
13salary is in excess of 6%. For the purposes of this Section,
14change in employment under Section 10-21.12 of the School Code
15on or after June 1, 2005 shall constitute a change in employer.
16The System may require the employer to provide any pertinent
17information or documentation. The changes made to this
18subsection (f) by this amendatory Act of the 94th General
19Assembly apply without regard to whether the teacher was in
20service on or after its effective date.
21    Whenever it determines that a payment is or may be required
22under this subsection, the System shall calculate the amount of
23the payment and bill the employer for that amount. The bill
24shall specify the calculations used to determine the amount
25due. If the employer disputes the amount of the bill, it may,
26within 30 days after receipt of the bill, apply to the System

 

 

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1in writing for a recalculation. The application must specify in
2detail the grounds of the dispute and, if the employer asserts
3that the calculation is subject to subsection (g) or (h) of
4this Section, must include an affidavit setting forth and
5attesting to all facts within the employer's knowledge that are
6pertinent to the applicability of that subsection. Upon
7receiving a timely application for recalculation, the System
8shall review the application and, if appropriate, recalculate
9the amount due.
10    The employer contributions required under this subsection
11(f) may be paid in the form of a lump sum within 90 days after
12receipt of the bill. If the employer contributions are not paid
13within 90 days after receipt of the bill, then interest will be
14charged at a rate equal to the System's annual actuarially
15assumed rate of return on investment compounded annually from
16the 91st day after receipt of the bill. Payments must be
17concluded within 3 years after the employer's receipt of the
18bill.
19    (g) This subsection (g) applies only to payments made or
20salary increases given on or after June 1, 2005 but before July
211, 2016 2011. The changes made by Public Act 94-1057 shall not
22require the System to refund any payments received before July
2331, 2006 (the effective date of Public Act 94-1057).
24    When assessing payment for any amount due under subsection
25(f), the System shall exclude salary increases paid to teachers
26under contracts or collective bargaining agreements entered

 

 

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

 

 

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1requiring the same certification or the amount stipulated in
2the collective bargaining agreement for a similar position
3requiring the same certification.
4    When assessing payment for any amount due under subsection
5(f), the System shall exclude any payment to the teacher from
6the State of Illinois or the State Board of Education over
7which the employer does not have discretion, notwithstanding
8that the payment is included in the computation of final
9average salary.
10    (h) When assessing payment for any amount due under
11subsection (f), the System shall exclude any salary increase
12described in subsection (g) of this Section given on or after
13July 1, 2016 2011 but before July 1, 2019 2014 under a contract
14or collective bargaining agreement entered into, amended, or
15renewed on or after June 1, 2005 but before July 1, 2016 2011.
16Notwithstanding any other provision of this Section, any
17payments made or salary increases given after June 30, 2019
182014 shall be used in assessing payment for any amount due
19under subsection (f) of this Section.
20    (i) The System shall prepare a report and file copies of
21the report with the Governor and the General Assembly by
22January 1, 2007 that contains all of the following information:
23        (1) The number of recalculations required by the
24    changes made to this Section by Public Act 94-1057 for each
25    employer.
26        (2) The dollar amount by which each employer's

 

 

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1    contribution to the System was changed due to
2    recalculations required by Public Act 94-1057.
3        (3) The total amount the System received from each
4    employer as a result of the changes made to this Section by
5    Public Act 94-4.
6        (4) The increase in the required State contribution
7    resulting from the changes made to this Section by Public
8    Act 94-1057.
9    (j) For purposes of determining the required State
10contribution to the System, the value of the System's assets
11shall be equal to the actuarial value of the System's assets,
12which shall be calculated as follows:
13    As of June 30, 2008, the actuarial value of the System's
14assets shall be equal to the market value of the assets as of
15that date. In determining the actuarial value of the System's
16assets for fiscal years after June 30, 2008, any actuarial
17gains or losses from investment return incurred in a fiscal
18year shall be recognized in equal annual amounts over the
195-year period following that fiscal year.
20    (k) For purposes of determining the required State
21contribution to the system for a particular year, the actuarial
22value of assets shall be assumed to earn a rate of return equal
23to the system's actuarially assumed rate of return.
24(Source: P.A. 95-331, eff. 8-21-07; 95-950, eff. 8-29-08;
2596-43, eff. 7-15-09.)
 

 

 

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1    Section 90. The State Mandates Act is amended by adding
2Section 8.35 as follows:
 
3    (30 ILCS 805/8.35 new)
4    Sec. 8.35. Exempt mandate. Notwithstanding Sections 6 and 8
5of this Act, no reimbursement by the State is required for the
6implementation of any mandate created by this amendatory Act of
7the 97th General Assembly.
 
8    Section 99. Effective date. This Act takes effect upon
9becoming law.