Sen. Napoleon Harris, III

Filed: 5/9/2018

 

 


 

 


 
10000SB0370sam003LRB100 05078 MJP 39903 a

1
AMENDMENT TO SENATE BILL 370

2    AMENDMENT NO. ______. Amend Senate Bill 370 by replacing
3everything after the enacting clause with the following:
 
4    "Section 5. The Illinois Pension Code is amended by
5changing Sections 3-125 and 4-118 as follows:
 
6    (40 ILCS 5/3-125)  (from Ch. 108 1/2, par. 3-125)
7    Sec. 3-125. Financing.
8    (a) The city council or the board of trustees of the
9municipality shall annually levy a tax upon all the taxable
10property of the municipality at the rate on the dollar which
11will produce an amount which, when added to the deductions from
12the salaries or wages of police officers, and revenues
13available from other sources, will equal a sum sufficient to
14meet the annual requirements of the police pension fund. The
15annual requirements to be provided by such tax levy are equal
16to (1) the normal cost of the pension fund for the year

 

 

10000SB0370sam003- 2 -LRB100 05078 MJP 39903 a

1involved, plus (2) an amount sufficient to bring the total
2assets of the pension fund up to 90% of the total actuarial
3liabilities of the pension fund by the end of municipal fiscal
4year 2040, as annually updated and determined by an enrolled
5actuary employed by the Illinois Department of Insurance or by
6an enrolled actuary retained by the pension fund or the
7municipality. In making these determinations, the required
8minimum employer contribution shall be calculated each year as
9a level percentage of payroll over the years remaining up to
10and including fiscal year 2040 and shall be determined under
11the projected unit credit actuarial cost method. The tax shall
12be levied and collected in the same manner as the general taxes
13of the municipality, and in addition to all other taxes now or
14hereafter authorized to be levied upon all property within the
15municipality, and shall be in addition to the amount authorized
16to be levied for general purposes as provided by Section 8-3-1
17of the Illinois Municipal Code, approved May 29, 1961, as
18amended. The tax shall be forwarded directly to the treasurer
19of the board within 30 business days after receipt by the
20county.
21    (b) For purposes of determining the required employer
22contribution to a pension fund, the value of the pension fund's
23assets shall be equal to the actuarial value of the pension
24fund's assets, which shall be calculated as follows:
25        (1) On March 30, 2011, the actuarial value of a pension
26    fund's assets shall be equal to the market value of the

 

 

10000SB0370sam003- 3 -LRB100 05078 MJP 39903 a

1    assets as of that date.
2        (2) In determining the actuarial value of the System's
3    assets for fiscal years after March 30, 2011, any actuarial
4    gains or losses from investment return incurred in a fiscal
5    year shall be recognized in equal annual amounts over the
6    5-year period following that fiscal year.
7    (c) Except as provided in subsection (c-5), if If a
8participating municipality fails to transmit to the fund
9contributions required of it under this Article for more than
1090 days after the payment of those contributions is due, the
11fund may, after giving notice to the municipality, certify to
12the State Comptroller the amounts of the delinquent payments in
13accordance with any applicable rules of the Comptroller, and
14the Comptroller must, beginning in fiscal year 2016, deduct and
15remit to the fund the certified amounts or a portion of those
16amounts from the following proportions of payments of State
17funds to the municipality:
18        (1) in fiscal year 2016, one-third of the total amount
19    of any payments of State funds to the municipality;
20        (2) in fiscal year 2017, two-thirds of the total amount
21    of any payments of State funds to the municipality; and
22        (3) in fiscal year 2018 and each fiscal year
23    thereafter, the total amount of any payments of State funds
24    to the municipality.
25    The State Comptroller may not deduct from any payments of
26State funds to the municipality more than the amount of

 

 

10000SB0370sam003- 4 -LRB100 05078 MJP 39903 a

1delinquent payments certified to the State Comptroller by the
2fund.
3    (c-5) As used in this subsection, "distressed
4municipality" means a participating municipality that: (A) has
5a population of 30% or more at or below the federal poverty
6threshold and has a median property value of owner-occupied
7housing units below $75,000, as determined by the most recent
8published estimates of the United States Census Bureau; or (B)
9is certified by the Department of Revenue as being in the
10highest 5% of all home rule municipalities in terms of the
11aggregate of the rate percent of all taxes levied in accordance
12with statute or ordinance upon all property of the municipality
13and is certified by the Department of Revenue as being in the
14lowest 5% of all home rule municipalities in terms of per
15capita tax yield.
16    If a distressed municipality fails to transmit to the fund
17contributions required of it under this Article for more than
18180 days after the payment of those contributions is due, then
19the fund may, after giving notice to the municipality, certify
20to the State Comptroller the amount of the delinquent payments
21in accordance with any applicable rules of the Comptroller, and
22the Comptroller must, beginning in fiscal year 2020, deduct and
23remit to the fund the certified amounts from the total amount
24of any payments of State funds to the municipality.
25    The State Comptroller may not deduct from any payments of
26State funds to the distressed municipality more than the amount

 

 

10000SB0370sam003- 5 -LRB100 05078 MJP 39903 a

1of delinquent payments certified to the State Comptroller by
2the fund. A distressed municipality is not subject to the
3provisions of subsection (c).
4    (d) The police pension fund shall consist of the following
5moneys which shall be set apart by the treasurer of the
6municipality:
7        (1) All moneys derived from the taxes levied hereunder;
8        (2) Contributions by police officers under Section
9    3-125.1;
10        (3) All moneys accumulated by the municipality under
11    any previous legislation establishing a fund for the
12    benefit of disabled or retired police officers;
13        (4) Donations, gifts or other transfers authorized by
14    this Article.
15    (e) The Commission on Government Forecasting and
16Accountability shall conduct a study of all funds established
17under this Article and shall report its findings to the General
18Assembly on or before January 1, 2013. To the fullest extent
19possible, the study shall include, but not be limited to, the
20following:
21        (1) fund balances;
22        (2) historical employer contribution rates for each
23    fund;
24        (3) the actuarial formulas used as a basis for employer
25    contributions, including the actual assumed rate of return
26    for each year, for each fund;

 

 

10000SB0370sam003- 6 -LRB100 05078 MJP 39903 a

1        (4) available contribution funding sources;
2        (5) the impact of any revenue limitations caused by
3    PTELL and employer home rule or non-home rule status; and
4        (6) existing statutory funding compliance procedures
5    and funding enforcement mechanisms for all municipal
6    pension funds.
7(Source: P.A. 99-8, eff. 7-9-15.)
 
8    (40 ILCS 5/4-118)  (from Ch. 108 1/2, par. 4-118)
9    Sec. 4-118. Financing.
10    (a) The city council or the board of trustees of the
11municipality shall annually levy a tax upon all the taxable
12property of the municipality at the rate on the dollar which
13will produce an amount which, when added to the deductions from
14the salaries or wages of firefighters and revenues available
15from other sources, will equal a sum sufficient to meet the
16annual actuarial requirements of the pension fund, as
17determined by an enrolled actuary employed by the Illinois
18Department of Insurance or by an enrolled actuary retained by
19the pension fund or municipality. For the purposes of this
20Section, the annual actuarial requirements of the pension fund
21are equal to (1) the normal cost of the pension fund, or 17.5%
22of the salaries and wages to be paid to firefighters for the
23year involved, whichever is greater, plus (2) an annual amount
24sufficient to bring the total assets of the pension fund up to
2590% of the total actuarial liabilities of the pension fund by

 

 

10000SB0370sam003- 7 -LRB100 05078 MJP 39903 a

1the end of municipal fiscal year 2040, as annually updated and
2determined by an enrolled actuary employed by the Illinois
3Department of Insurance or by an enrolled actuary retained by
4the pension fund or the municipality. In making these
5determinations, the required minimum employer contribution
6shall be calculated each year as a level percentage of payroll
7over the years remaining up to and including fiscal year 2040
8and shall be determined under the projected unit credit
9actuarial cost method. The amount to be applied towards the
10amortization of the unfunded accrued liability in any year
11shall not be less than the annual amount required to amortize
12the unfunded accrued liability, including interest, as a level
13percentage of payroll over the number of years remaining in the
1440 year amortization period.
15    (a-5) For purposes of determining the required employer
16contribution to a pension fund, the value of the pension fund's
17assets shall be equal to the actuarial value of the pension
18fund's assets, which shall be calculated as follows:
19        (1) On March 30, 2011, the actuarial value of a pension
20    fund's assets shall be equal to the market value of the
21    assets as of that date.
22        (2) In determining the actuarial value of the pension
23    fund's assets for fiscal years after March 30, 2011, any
24    actuarial gains or losses from investment return incurred
25    in a fiscal year shall be recognized in equal annual
26    amounts over the 5-year period following that fiscal year.

 

 

10000SB0370sam003- 8 -LRB100 05078 MJP 39903 a

1    (b) The tax shall be levied and collected in the same
2manner as the general taxes of the municipality, and shall be
3in addition to all other taxes now or hereafter authorized to
4be levied upon all property within the municipality, and in
5addition to the amount authorized to be levied for general
6purposes, under Section 8-3-1 of the Illinois Municipal Code or
7under Section 14 of the Fire Protection District Act. The tax
8shall be forwarded directly to the treasurer of the board
9within 30 business days of receipt by the county (or, in the
10case of amounts added to the tax levy under subsection (f),
11used by the municipality to pay the employer contributions
12required under subsection (b-1) of Section 15-155 of this
13Code).
14    (b-5) Except as provided in subsection (b-10), if If a
15participating municipality fails to transmit to the fund
16contributions required of it under this Article for more than
1790 days after the payment of those contributions is due, the
18fund may, after giving notice to the municipality, certify to
19the State Comptroller the amounts of the delinquent payments in
20accordance with any applicable rules of the Comptroller, and
21the Comptroller must, beginning in fiscal year 2016, deduct and
22remit to the fund the certified amounts or a portion of those
23amounts from the following proportions of payments of State
24funds to the municipality:
25        (1) in fiscal year 2016, one-third of the total amount
26    of any payments of State funds to the municipality;

 

 

10000SB0370sam003- 9 -LRB100 05078 MJP 39903 a

1        (2) in fiscal year 2017, two-thirds of the total amount
2    of any payments of State funds to the municipality; and
3        (3) in fiscal year 2018 and each fiscal year
4    thereafter, the total amount of any payments of State funds
5    to the municipality.
6    The State Comptroller may not deduct from any payments of
7State funds to the municipality more than the amount of
8delinquent payments certified to the State Comptroller by the
9fund.
10    (b-10) As used in this subsection, "distressed
11municipality" means a participating municipality that: (A) has
12a population of 30% or more at or below the federal poverty
13threshold and has a median property value of owner-occupied
14housing units below $75,000, as determined by the most recent
15published estimates of the United States Census Bureau; or (B)
16is certified by the Department of Revenue as being in the
17highest 5% of all home rule municipalities in terms of the
18aggregate of the rate percent of all taxes levied in accordance
19with statute or ordinance upon all property of the municipality
20and is certified by the Department of Revenue as being in the
21lowest 5% of all home rule municipalities in terms of per
22capita tax yield.
23    If a distressed municipality fails to transmit to the fund
24contributions required of it under this Article for more than
25180 days after the payment of those contributions is due, then
26the fund may, after giving notice to the municipality, certify

 

 

10000SB0370sam003- 10 -LRB100 05078 MJP 39903 a

1to the State Comptroller the amount of the delinquent payments
2in accordance with any applicable rules of the Comptroller, and
3the Comptroller must, beginning in fiscal year 2020, deduct and
4remit to the fund the certified amounts from the total amount
5of any payments of State funds to the municipality.
6    The State Comptroller may not deduct from any payments of
7State funds to the distressed municipality more than the amount
8of delinquent payments certified to the State Comptroller by
9the fund. A distressed municipality is not subject to the
10provisions of subsection (b-5).
11    (c) The board shall make available to the membership and
12the general public for inspection and copying at reasonable
13times the most recent Actuarial Valuation Balance Sheet and Tax
14Levy Requirement issued to the fund by the Department of
15Insurance.
16    (d) The firefighters' pension fund shall consist of the
17following moneys which shall be set apart by the treasurer of
18the municipality: (1) all moneys derived from the taxes levied
19hereunder; (2) contributions by firefighters as provided under
20Section 4-118.1; (3) all rewards in money, fees, gifts, and
21emoluments that may be paid or given for or on account of
22extraordinary service by the fire department or any member
23thereof, except when allowed to be retained by competitive
24awards; and (4) any money, real estate or personal property
25received by the board.
26    (e) For the purposes of this Section, "enrolled actuary"

 

 

10000SB0370sam003- 11 -LRB100 05078 MJP 39903 a

1means an actuary: (1) who is a member of the Society of
2Actuaries or the American Academy of Actuaries; and (2) who is
3enrolled under Subtitle C of Title III of the Employee
4Retirement Income Security Act of 1974, or who has been engaged
5in providing actuarial services to one or more public
6retirement systems for a period of at least 3 years as of July
71, 1983.
8    (f) The corporate authorities of a municipality that
9employs a person who is described in subdivision (d) of Section
104-106 may add to the tax levy otherwise provided for in this
11Section an amount equal to the projected cost of the employer
12contributions required to be paid by the municipality to the
13State Universities Retirement System under subsection (b-1) of
14Section 15-155 of this Code.
15    (g) The Commission on Government Forecasting and
16Accountability shall conduct a study of all funds established
17under this Article and shall report its findings to the General
18Assembly on or before January 1, 2013. To the fullest extent
19possible, the study shall include, but not be limited to, the
20following:
21        (1) fund balances;
22        (2) historical employer contribution rates for each
23    fund;
24        (3) the actuarial formulas used as a basis for employer
25    contributions, including the actual assumed rate of return
26    for each year, for each fund;

 

 

10000SB0370sam003- 12 -LRB100 05078 MJP 39903 a

1        (4) available contribution funding sources;
2        (5) the impact of any revenue limitations caused by
3    PTELL and employer home rule or non-home rule status; and
4        (6) existing statutory funding compliance procedures
5    and funding enforcement mechanisms for all municipal
6    pension funds.
7(Source: P.A. 99-8, eff. 7-9-15.)
 
8    Section 99. Effective date. This Act takes effect upon
9becoming law.".