Illinois General Assembly - Full Text of HB2532
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Full Text of HB2532  99th General Assembly




State of Illinois
2015 and 2016


Introduced 2/18/2015, by Rep. Michael W. Tryon


New Act
15 ILCS 405/6.01  from Ch. 15, par. 206.01
25 ILCS 155/4  from Ch. 63, par. 344

    Creates the Long-Term Accounting Act. Provides that the purpose of the Act is to improve transparency and accountability during the State budget process. Contains provisions concerning the passage of appropriation bills and the electronic publication of appropriation bills. Amends the State Comptroller Act. Amends the Commission on Governmental Forecasting and Accountability Act. Provides that the Commission on Governmental Forecasting and Accountability must publish fiscal budget statements. Sets forth the requirements for the fiscal budget statements. Contains other provisions. Effective immediately.

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1    AN ACT concerning State government.
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
4    Section 1. Short title. This Act may be cited as the
5Long-Term Accounting Act.
6    Section 5. Legislative intent. It is the intent of this Act
7to improve transparency and accountability during the State
8budget process by:
9    (1) confirming and strengthening the State's special
10responsibility to disclose its actions and results of those
11actions in a timely and useful way;
12    (2) establishing the concept that State budgeting
13disclosures and financial reporting are created primarily for
14the purpose of informing the public of government activity and
15creating widespread understanding of these actions;
16    (3) adopting the use of consolidated budget documents to
17facilitate the public's ability to understand the State's
18annual and accumulated shortfalls despite the relative scale of
19the State's financial operations and the volume and complexity
20of budget and financial data;
21    (4) establishing the State's duty to report the best
22estimate of its own financial condition;
23    (5) requiring a comprehensive indication of the total



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1activity of government and the long-term effects of current
3    (6) calling for the calculation of the long-term financial
4implications to the State and others of the budgetary
6    (7) providing the full-cost information necessary to
7accurately calculate performance measurements;
8    (8) establishing definitions of existing statutory
9language to strengthen the Governor's and the General
10Assembly's ability to determine compliance with the intent of
11Section 2 of Article VIII of the Illinois Constitution
12requirement, which is to preserve intergenerational equity;
13    (9) requiring explicit disclosure and accurate reporting
14by the Governor and the General Assembly of:
15        (A) debt incurred to fund current operating expenses;
16        (B) current and past costs shifted to future budgets
17    and imposed upon future taxpayers;
18        (C) State obligations, including, but not limited to,
19    current and future personnel benefit costs and
20    lapse-period expenditures; and
21        (D) any fiscal deficit in terms of the excess of full
22    accrual expenses over full accrual revenues, as well as any
23    budget surplus in terms of the excess of full accrual
24    revenues over full accrual expenses, at the time the final
25    budget is sent to the Governor;
26    (10) calling for the Governor and the General Assembly to



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1determine if future budgetary resources will likely be
2sufficient to sustain public services and to meet obligations
3as they come due;
4    (11) acknowledging costs when incurred during the budget
5year regardless of when they are paid;
6    (12) injecting the expertise and knowledge of the State
7Comptroller's Office into the preparation of budget
9    (13) unveiling the State's unusual reliance upon the use of
10more than 600 special funds;
11    (14) requiring the Annual Budget and the State's
12Comprehensive Annual Financial Report to be prepared to
13facilitate a simple comparison of budgeted amounts to the
14actual amounts spent and received;
15    (15) requiring State agencies to report to the Comptroller
16all fiscal information necessary to prepare a comprehensive
17annual financial report in a timely manner; and
18    (16) mandating the production of the State's Comprehensive
19Annual Financial Report within 6 months after the end of the
20State's fiscal year.
21    Section 10. Definitions.
22    "Amounts due to pension funds" means the unfunded actuarial
23accrued liability for the State pension plans, including the
24portion of multiple-employer plans attributed to the State.
25    "Benefit enhancements" means the actuarial present value



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1of total projected benefits attributed to the estimated
2increase in the benefits of retirees or beneficiaries granted
3by the proposed budget or proposed or enacted changes to the
4Illinois Pension Code. The benefit enhancements that result
5from plan members' expected future service amount may be
6reduced by the amount of specified revenue sources enacted into
8    "Capital assets" shall be defined using Governmental
9Accounting Standards Board concepts outlined in GASB Statement
11    "Comptroller's budget statements" means the estimated
12balance sheet, the estimated statement of activities, and the
13estimated statement of cash flow.
14    "Estimated balance sheet" means the estimated statement of
15net assets prepared using the GASB concepts outlined in GASB
16Statement 34.
17    "Estimated retirement plans' assets gain or loss" means the
18change in the actuarial value of assets from the beginning of
19the budget period to the end of the budget period.
20    "Fiscal budget statements" means the estimated statement
21of fiscal balance, the estimated statement of fiscal deficit,
22and the estimated financial state of the State.
23    "Fiduciary funds" shall be defined using GASB concepts
24outlined in GASB Statement 34.
25    "Government-Wide Generally Accepted Accounting Principles
26(Government-Wide GAAP)" means the accounting standards used in



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1the preparation of the State's government-wide financial
2statements, using GASB concepts outlined in the GASB Statement
334. While the Governmental Accounting Standards Board does not
4prescribe standards for preparing governmental budgets, the
5accounting standards' concepts shall be applied to the fiscal
6budget statements prepared under this Act.
7    "Increase or Decrease in Other Post Employment Benefits
8(OPEB) Due" means the change in the State's OPEB plans'
9estimated actuarial accrued liability from the beginning of the
10budget period to the end of the budget period.
11    "Increase or Decrease in Pension Benefits Due" means the
12change in the State's pension plans' estimated actuarial
13accrued liability at the beginning of the budget period and the
14sum of each pension plan's estimated actuarial accrued
15liability at the end of the budget period.
16    "Net Pension Obligations or Assets", "Net Other Post
17Employment Obligations Assets", "Actuarial Value of Assets",
18"Actuarial Accrued Liability", "Unfunded Actuarial Accrued
19Liability (UAAL)", and "Actuarial Present Value of Total
20Projected Benefits" shall be defined using GASB concepts
21outlined in GASB Statement 45, GASB Statement 25, and GASB
22Statement 27, as amended by GASB 50.
23    "Off Balance Sheet Other Post Employment (OPEB)
24Liabilities" means the difference between the State OPEB plans'
25Estimated UAAL and the estimated Net OPEB Obligations or Assets
26included in the estimated balance sheet.



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1    "Off Balance Sheet Pension Liabilities" means the
2difference between the State pension plans' estimated unfunded
3actuarial accrued liability (UAAL) and the estimated net
4pension obligations or Assets included in the estimated balance
6    "Retirees' health care benefits" means the unfunded
7actuarial accrued liability (UAAL) for the State OPEB Plans,
8including the portion of multiple-employer plans attributed to
9the State.
10    "State Other Post Employment Benefit (OPEB) Plans" include
11the State's Single-Employer Other Post Employment Benefit
12(OPEB) plans, and also include the portion of Agent
13Multiple-Employer (OPEB) plans attributed to the State.
14    "State pension plans" means the State's single-employer
15pension plans and the portion of agent multiple-employer
16pension plans attributed to the State.
17    Section 15. Electronic publication of appropriation bills;
18publication deadlines with respect to second and third
19readings. The General Assembly shall publish, on a web page
20controlled by the General Assembly, the texts of all
21appropriations bills. Each publication shall include an
22embedded time stamp setting forth the time of electronic
23publication. No amendment to an appropriation bill shall be
24considered on second reading until at least 72 hours after the
25amendment has been published electronically and no bill to



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1appropriate funds shall be passed on third reading until at
2least 72 hours after the time of electronic publication in
3final form.
4    Section 20. Passage of appropriation bills prohibited
5before adoption of joint resolution. The General Assembly shall
6not enact any bill to appropriate funds within any fiscal year
7prior to its adoption of a joint resolution reflecting the
8estimate of funds available for that fiscal year as required
9under Section 4 of the Commission on Government Forecasting and
10Accountability Act.
11    Section 25. State funds as fiduciary funds. All State funds
12shall be fiduciary funds unless explicitly provided otherwise
13by law.
14    Section 90. The State Comptroller Act is amended by
15changing Section 6.01 as follows:
16    (15 ILCS 405/6.01)  (from Ch. 15, par. 206.01)
17    Sec. 6.01. Specification and establishment of accounting
18standards and principles. The Comptroller shall specify and
19establish the financial accounting and reporting standards and
20principles to be used by all State government and State
21agencies. The standards and principles shall be effective upon
22filing by the Comptroller with the Auditor General. The



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1Comptroller shall maintain and publish the standards and
2principles as a public document. These standards and principles
3shall be known as the Generally Accepted Accounting Standards
4and Principles for Illinois State Government, and shall be
5compatible with generally accepted accounting standards and
6principles for government as prescribed by the Governmental
7Accounting Standards Board (GASB). , whenever possible, be
8compatible with any similar nationally existing generally
9accepted accounting standards and principles for government.
10    In establishing the Generally Accepted Accounting
11Standards and Principles for Illinois State Government, the
12Comptroller shall consult with the Governor and the other
13members of the Executive Branch, the Chief Justice of the
14Supreme Court, and the leadership of the General Assembly and
15shall provide to these officials, and publish on the
16Comptroller's website, draft copies of any proposed standards
17at least 90 days prior to their adoption and shall consider any
18responses or suggestions that these officials or the public may
20(Source: P.A. 86-1415.)
21    Section 95. The Commission on Government Forecasting and
22Accountability Act is amended by changing Section 4 as follows:
23    (25 ILCS 155/4)  (from Ch. 63, par. 344)
24    Sec. 4. (a) The Commission shall publish, at the convening



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1of each regular session of the General Assembly, a report on
2the estimated income of the State from all applicable revenue
3sources for the next ensuing fiscal year and of any other funds
4estimated to be available for such fiscal year. The Commission,
5in its discretion, may consult with the Governor's Office of
6Management and Budget in preparing the report. On the third
7Wednesday in March after the session convenes, the Commission
8shall issue a revised and updated set of revenue figures
9reflecting the latest available information. The House and
10Senate by joint resolution shall adopt or modify such estimates
11as may be appropriate. The joint resolution must include all
12applicable revenues and other funds available. The joint
13resolution shall constitute the General Assembly's estimate,
14under paragraph (b) of Section 2 of Article VIII of the
15Constitution, of the funds estimated to be available during the
16next fiscal year. The report must estimate all applicable
17revenues and must estimate other funds available. The report
18shall clearly separate and distinguish all applicable revenues
19and other funds available when estimating the funds estimated
20to be available for purposes of calculating funds estimated to
21be available as required under subsection (b) of Section 2 of
22Article VIII of the Illinois Constitution.
23    (a-5) The annual March estimates issued by the Commission
24shall include an estimated balance sheet, an estimated
25statement of activities, and an estimated statement of cash
26flow. The March estimates shall include a variance report of



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1the ongoing fiscal year's budget and appropriations.
2    (a-10) The Commission shall also prepare:
3        (1) The estimated statement of fiscal balance, which
4    shall include:
5            (A) The columns used in the estimated balance
6        sheet.
7            (B) The total net assets, as determined in the
8        estimated balance sheet.
9            (C) The off-balance sheet pension liability.
10            (D) The off-balance sheet OPEB liability
11            (E) The resulting fiscal balance.
12        (2) The estimated statement of fiscal deficit, which
13    shall include:
14            (A) The columns used in the estimated statement of
15        activities.
16            (B) The change in net assets, as determined in the
17        estimated statement of activities.
18            (C) Benefit enhancements.
19            (D) Retirement plans' assets gain or loss.
20            (E) Increases or decreases in pension benefits
21        due.
22            (F) Increases or decreases in OPEB benefits due.
23            (G) The resulting fiscal deficit.
24        (3) The estimated financial state of the State, which
25    shall include:
26            (A) Amounts reported on the State's Comprehensive



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1        Annual Financial Report (CAFR) for the State fiscal
2        year 2 years prior to the current budget year.
3            (B) The estimated values from last period's
4        budget.
5            (C) The estimated values from the current budget
6        period.
7            (D) What the State owns:
8                (i) Capital assets.
9                (ii) Other assets that are derived from the
10            total assets reported on the statement of net
11            assets/balance sheet minus capital assets.
12                (iii) State assets shall equal the total
13            assets.
14            (E) What the State owes:
15                (i) The amount of State bonds, including, but
16            not limited to, General Obligation Bonds and
17            Special Revenue Bonds.
18                (ii) Amounts due pension funds.
19                (iii) Retirees' health care benefits (OPEB).
20                (iv) Other liabilities that are derived by
21            subtracting the State bonds, the net pension
22            obligation, and the net OPEB obligation from the
23            total liabilities reported on the statement of net
24            assets/balance sheet.
25                (v) State bills.
26            (F) Where the State stands:



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1                (i) Illinois' financial position.
2                (ii) Each Illinois family's share, which is
3            derived by dividing Illinois' financial position
4            divided by the Illinois population estimate as
5            determined by the U.S. Census Bureau divided by the
6            national average size of a family as determined by
7            the U.S. Census Bureau.
8    (a-20) In conjunction with the State Comptroller, the
9Commission shall publish the fiscal budget statements outlined
10in subsection (a-5) in concert with Government Wide-GAAP. The
11fiscal budget statements shall include information about the
12State as a whole. The fiscal budget statements should include
13the primary government and its component units, except for the
14fiduciary funds of the primary government and component units
15that are fiduciary in nature. The fiscal budget statements
16shall be prepared using the economic resources measurement
17focus and the accrual basis of accounting. The fiscal budget
18statements shall not be presented using the current financial
19resources measurement focus and the modified accrual basis of
20accounting, which are used to prepare the State's governmental
21funds financial statements. The Commission shall obtain from
22each of the State's pension and OPEB plans' actuaries to
23determine the pension and OPEB amounts needed to prepare the
24fiscal budget statements.
25    (b) On the third Wednesday in March, the Commission shall
26issue estimated:



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1        (1) pension funding requirements under P.A. 86-273;
2    and
3        (2) liabilities of the State employee group health
4    insurance program.
5    These estimated costs shall be for the fiscal year
6beginning the following July 1.
7    (c) The requirement for reporting to the General Assembly
8shall be satisfied by filing copies of the report with the
9Speaker, the Minority Leader and the Clerk of the House of
10Representatives and the President, the Minority Leader and the
11Secretary of the Senate and the Legislative Research unit, as
12required by Section 3.1 of the General Assembly Organization
13Act, and filing such additional copies with the State
14Government Report Distribution Center for the General Assembly
15as is required under paragraph (t) of Section 7 of the State
16Library Act.
17    (d) For each fiscal year, the General Assembly shall adopt
18a joint resolution accepting the amounts reported on the fiscal
19budget statements.
20    (e) For the purposes of this Section, "all applicable
21revenues" means "own source revenues", including:
22        (1) personal income tax;
23        (2) corporate income tax;
24        (3) corporate personal property replacement tax;
25        (4) sales tax retained by the State;
26        (5) excise taxes, such as excise taxes on alcohol,



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1    gasoline, or energy;
2        (6) user fees;
3        (7) fines and penalties;
4        (8) gaming taxes;
5        (9) investment income;
6        (10) unencumbered funds provided by other governmental
7    units; or
8        (11) any other revenue source for which the State has
9    no ongoing or unfulfilled obligation to any other party.
10    For the purposes of this Section, "other funds available"
12        (1) funds that result from the actions of another
13    entity or government;
14        (2) funds received that are held in trust or have a
15    fiduciary element;
16        (3) pass-through funds or funds received by the State
17    when acting as an agent or collector for another entity;
18        (4) pension contributions made by State employees not
19    used to pay pensions or used to purchase assets for the
20    State's pension funds;
21        (5) that portion of sales tax collections that
22    retailers pay to the State but that will be remitted to
23    home rule and local governments;
24        (6) court-ordered collections of child support;
25        (7) inter-period borrowings;
26        (8) prepaid tuition plans; or



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1        (9) any other source of funds for which the State has
2    an unfulfilled or ongoing obligation.
3    The definitions set forth in Section 10 of the Truth in
4Accounting Act of 2010 are incorporated.
5(Source: P.A. 96-958, eff. 7-1-10.)
6    Section 99. Effective date. This Act takes effect upon
7becoming law.