HB2468ham001 94TH GENERAL ASSEMBLY

Personnel and Pensions Committee

Filed: 3/10/2005

09400HB2468ham001 LRB094 08345 AMC 42784 a

AMENDMENT TO HOUSE BILL 2468

AMENDMENT NO. ______. Amend House Bill 2468 by replacing everything after the enacting clause with the following:

"Section 5. The Illinois Pension Code is amended by changing Sections 17-127 and 17-129 as follows:

(40 ILCS 5/17-127) (from Ch. 108 1/2, par. 17-127)

Sec. 17-127. Financing; revenues for the Fund.

(a) The revenues for the Fund shall consist of: (1) amounts paid into the Fund by contributors thereto and from employer contributions and State appropriations in accordance with this Article; (2) amounts contributed to the Fund by an Employer; (3) amounts contributed to the Fund pursuant to any law now in force or hereafter to be enacted; (4) contributions from any other source; and (5) the earnings on investments of the Fund.

(b) The General Assembly finds that for many years the State has contributed to the Fund an annual amount that is between 20% and 30% of the amount of the annual State contribution to the Article 16 retirement system, and the General Assembly declares that it is its goal and intention to continue this level of contribution to the Fund in the future.

(b-5) Beginning In State fiscal years year 1999 through 2005, the State shall include in its annual contribution to the Fund an additional amount equal to 0.544% of the Fund's total teacher payroll; except that this additional contribution need not be made in a fiscal year if the Board has certified in the previous fiscal year that the Fund is at least 90% funded, based on actuarial determinations. These additional State contributions are intended to offset a portion of the cost to the Fund of the increases in retirement benefits resulting from Public Act 90-582 this amendatory Act of 1998.

(c) For each State fiscal year ending after calendar year 2005, the State shall contribute to the Fund, by means of appropriations from the Common School Fund or other State funds, an amount not less than the greater of (i) the amount appropriated for the Fund for the State fiscal year ending in calendar year 2003 or (ii) the minimum funding requirement, as defined below, for that fiscal year (calculated without regard to any contribution of the State to or for the benefit of the Fund under this subsection (c)).

(d) Beginning in the State fiscal year ending in 2006, on the 15th day of each month, or as soon after that date as is practicable, the Board shall submit vouchers for payment of State contributions to the Fund, in a monthly amount of one-twelfth of the required annual State contribution under subsection (c) of this Section. If that required annual contribution changes during the State fiscal year, the remaining monthly amounts shall be adjusted in equal amounts so that the total amount for which vouchers are submitted for the year equals that required annual contribution. These vouchers shall be paid by the State Comptroller and Treasurer by warrants drawn on the funds appropriated to the Fund for that fiscal year. If, in any month, the amount remaining unexpended from all other State appropriations to the Fund for that State fiscal year is less than the amount for which vouchers are lawfully submitted under this Section, the difference shall be paid under the continuing appropriation available for that purpose pursuant to the Chicago Teacher Pension Fund Continuing Appropriation Act.

(e) If the State does not make the contribution required by subsections (c) and (d), then the Board of Education shall meet the minimum funding requirement, as defined in subsection (f).

(f) For the purposes of this Section, "minimum funding requirement" for any fiscal year means the minimum Board of Education contribution to the Fund under Section 17-129 (calculated without regard to any contribution of the State to or for the benefit of the Fund).

(g) The changes made to this Section or Section 17-129 by this amendatory Act of the 94th General Assembly shall not be construed, interpreted, or otherwise viewed to imply an authorization, desire, or intent to merge or in any other way combine the Public School Teachers' Pension and Retirement Fund of Chicago with any other pension fund.

(Source: P.A. 90-548, eff. 12-4-97; 90-566, eff. 1-2-98; 90-582, eff. 5-27-98; 90-655, eff. 7-30-98.)

(40 ILCS 5/17-129) (from Ch. 108 1/2, par. 17-129)

Sec. 17-129. Employer contributions; deficiency in Fund.

(a) If in any fiscal year of the Board of Education ending prior to 1997 the total amounts paid to the Fund from the Board of Education (other than under this subsection, and other than amounts used for making or "picking up" contributions on behalf of teachers) and from the State do not equal the total contributions made by or on behalf of the teachers for such year, or if the total income of the Fund in any such fiscal year of the Board of Education from all sources is less than the total such expenditures by the Fund for such year, the Board of Education shall, in the next succeeding year, in addition to any other payment to the Fund set apart and appropriate from moneys from its tax levy for educational purposes, a sum sufficient to remove such deficiency or deficiencies, and promptly pay such sum into the Fund in order to restore any of the reserves of the Fund that may have been so temporarily applied. Any amounts received by the Fund after December 4, 1997 from State appropriations, including under Section 17-127, shall be a credit against and shall fully satisfy any obligation that may have arisen, or be claimed to have arisen, under this subsection (a) as a result of any deficiency or deficiencies in the fiscal year of the Board of Education ending in calendar year 1997.

(b) (i) For fiscal years 2011 through 2045, the minimum contribution to the Fund to be made by the Board of Education in each fiscal year shall be an amount determined by the Fund to be sufficient, taking into account payments made and to be made under Section 17-127.2, to bring the total assets of the Fund up to 90% of the total actuarial liabilities of the Fund by the end of fiscal year 2045. In making these determinations, the required Board of Education contribution shall be calculated each year as a level percentage of the applicable employee payrolls over the years remaining to and including fiscal year 2045 and shall be determined under the projected unit credit actuarial cost method.

(ii) For fiscal years 1999 through 2010, the Board of Education's contribution to the Fund, as a percentage of the applicable employee payroll, shall be increased in equal annual increments so that by fiscal year 2011, the Board of Education is contributing at the rate required under this subsection.

(iii) Beginning in fiscal year 2046, the minimum Board of Education contribution for each fiscal year shall be the amount needed to maintain the total assets of the Fund at 90% of the total actuarial liabilities of the Fund.

(iv) Notwithstanding the provisions of paragraphs (i), (ii), and (iii) of this subsection (b) or Section 17-127.2, for any fiscal year the contribution to the Fund from the Board of Education shall not be required to be in excess of the amount calculated as needed to maintain the assets (or cause the assets to be) at the 90% level by the end of the fiscal year.

(v) Any contribution by the State to or for the benefit of the Fund in a fiscal year, including, without limitation, any contribution as referred to under Section 17-127, shall be a credit against any contribution required to be made by the Board of Education under this subsection (b).

(c) The Board shall determine the amount of Board of Education contributions required for each fiscal year on the basis of the actuarial tables and other assumptions adopted by the Board and the recommendations of the actuary, in order to meet the minimum contribution requirements of subsections (a) and (b). Annually, on or before February 28, the Board shall certify to the Board of Education the amount of the required Board of Education contribution for the coming fiscal year. The certification shall include a copy of the actuarial recommendations upon which it is based.

(Source: P.A. 89-15, eff. 5-30-95; 90-548, eff. 12-4-97; 90-566, eff. 1-2-98; 90-655, eff. 7-30-98.)

Section 99. Effective date. This Act takes effect upon becoming law.".