09900SR0317 EnrolledLRB099 11807 MST 33736 r

1
SENATE RESOLUTION NO. 317

 
2    WHEREAS, Public Act 96-0889 was passed in 2010 and
3established, among other provisions, a "Tier 2" pension plan;
4and
 
5    WHEREAS, Public employees who began service on or after
6January 1, 2011 are now enrolled in what is commonly referred
7to as the "Tier 2" pension plan; and
 
8    WHEREAS, The Tier 2 pension plan dramatically reduced
9benefits for these members of the Teachers' Retirement System
10(TRS) and the State Universities Retirement System (SURS); and
 
11    WHEREAS, At the time of passage of this plan, it was
12estimated that this change would result in $64 billion in
13savings to State taxpayers; and
 
14    WHEREAS, Members of the Tier 2 pension plan in TRS and SURS
15do not participate in Social Security, and many experts believe
16that the Tier 2 pension plan does not provide benefits that are
17at least comparable to those provided by the Old-Age portion of
18the Social Security program; and
 
19    WHEREAS, Failure to provide benefits at least comparable to
20Social Security for Tier 2 members who do not participate in

 

 

09900SR0317 Enrolled- 2 -LRB099 11807 MST 33736 r

1Social Security could result in severe unforeseen consequences
2for taxpayers in the State of Illinois; and
 
3    WHEREAS, Illinois taxpayers need to be advised of all the
4implications regarding this change, especially the possible
5impact on property taxes, higher education budgets, and school
6funding; and
 
7    WHEREAS, The Governor has called for the mandatory
8participation of current Tier 1 members in the Tier 2 plan
9after an undetermined date; and
 
10    WHEREAS, It would be irresponsible to pursue such a drastic
11change without a federal determination as to whether or not
12Tier 2 participants in TRS and SURS receive benefits that are
13in compliance with protections provided under the Internal
14Revenue Code of 1986; and
 
15    WHEREAS, Such a change would harm thousands of working
16families throughout Illinois and significantly impact our
17universities' and schools' workforces; and
 
18    WHEREAS, It would be irresponsible for the State of
19Illinois to enact such a drastic proposal without studying the
20financial impact it would have on taxpayers and working
21families; therefore, be it
 

 

 

09900SR0317 Enrolled- 3 -LRB099 11807 MST 33736 r

1    RESOLVED, BY THE SENATE OF THE NINETY-NINTH GENERAL
2ASSEMBLY OF THE STATE OF ILLINOIS, that we urge TRS and SURS to
3pursue an Internal Revenue Service ruling on the compliance of
4Tier 2 with safe harbor provisions under Section 3121(b)(7)(F)
5of the Internal Revenue Code of 1986; and be it further
 
6    RESOLVED, That TRS and SURS provide a detailed analysis on
7the financial impact that the Governor's proposal would have on
8the members of working families who are currently in the Tier 1
9pension plan; and be it further
 
10    RESOLVED, That this report be completed prior to any
11consideration of the Governor's proposal to move Tier 1
12participants in TRS and SURS into Tier 2.