SB1673ham015 97TH GENERAL ASSEMBLY

Rep. Elaine Nekritz

Filed: 1/8/2013

09700SB1673ham015 LRB097 07605 SSS 73166 a

AMENDMENT TO SENATE BILL 1673

AMENDMENT NO. ______. Amend Senate Bill 1673, AS AMENDED, by replacing everything after the enacting clause with the following:

"Section 1. Short title. This Act may be cited as the Pension Review Commission Act.

Section 5. Pension Review Commission. The Pension Review Commission, hereinafter called the "Commission", is hereby created and shall be comprised of eight Commissioners. Within fifteen calendar days following the effective date of this amendatory Act of the 97th General Assembly, the Speaker of the House of Representatives, the President of the Senate, the Minority Leader of the House of Representatives and the Minority Leader of the Senate shall each appoint two Commissioners.

Commissioners shall be at least 18 years of age, reside within Illinois, and shall not be required to register under the Lobbyist Registration Act. In the event of a vacancy, the respective appointing legislative leader shall appoint a new member to fill the vacancy within fifteen calendar days after the vacancy.

The Commission on Government Forecasting and Accountability (COGFA) shall provide administrative support and assistance to the Commission.

Section 10. Standards for Delegation of Authority.

(a) The Commission shall determine the changes to law necessary to ensure that the State Employee Retirement System, the General Assembly Retirement System, the State University Retirement System, and the Teacher's Retirement System will reach 100% actuarial funding for all then-existing liabilities not later than December 31, 2045, calculated and defined in full accordance with the applicable standards and guidelines of the Governmental Accounting Standards Board.

(b) In determining the necessary changes to existing law, the Commission shall consider the following factors:

1. the total amount of the existing unfunded liabilities for the four retirement systems identified in this Act;

2. the current and projected rates of growth in those unfunded liabilities;

3. the current and future projected total required annual State contributions to the retirement systems; for purposes of this Act, "total required annual State contribution to the retirement systems" is the sum of the amounts that the State of Illinois must pay on an annualized basis from general revenue funds and any other fund source to the four retirement systems identified in this Public Act, including the normal cost of benefits earned and payment towards the interest and principal that comprise the unfunded accrued liabilities, as prescribed under current law;

4. the annual cost to the State attributable to retirement benefits earned by members as a result of employment at entities other than State of Illinois;

5. the cost to the entities other than the State of Illinois including but not limited to any unit of local government attributable to retirement benefits earned by members as a result of employment at entities other than the State of Illinois;

6. the most costly components of the benefit structures of the four retirement systems identified in this Public Act, which apply or relate to any member of the four retirement systems identified in this Act, irrespective of whether the member is currently receiving retirement benefits including, but not limited to the following:

a. the amounts of the cost of living adjustments (COLA) to which members are entitled,

b. the definition of the salary basis on which the calculation of the member's retirement benefit is based, commonly known as the member's "Final Average Compensation" (FAC) (or the equivalent thereof),

c. the methods and definitions that the retirement systems to which this Act applies use to determine: actuarial liability, normal cost, actuarially-required annual contribution, unfunded actuarial liabilities, asset valuation, and other such calculations.

7. the value of public employee pension benefits in comparable states for similar positions of employment;

8. the value of retirement benefits for comparable services performed in the private sector in Illinois and comparable states based on the responsibility and discretion required in the position of employment;

9. the effect of inflation as defined and calculated by the Bureau of Labor Statistics (BLS) of the United States government upon retirement benefits earned by members of the retirement systems to which this Public Act applies;

10. the amounts of employee contributions to the four pension systems; and

11. the interests and welfare of the public and the financial ability of the State to meet those costs.

Section 15. Public Hearings. The Commission shall conduct public hearings prior to filing its report. Notice of hearings shall be made on the General Assembly website and by methods deemed appropriate by the Commission. All interested persons shall be provided with an opportunity to comment. Any documents submitted to the Commission by those seeking to comment shall be deemed public records under the Freedom of Information Act.

Section 20. Commission Report. The Commission shall file a report including its determinations of changes to existing law, set forth in the form of a bill, no later than April 30, 2013. The report shall be submitted to the Clerk of the House and Secretary of the Senate, and shall be made available on the General Assembly website. The Commission may also file a report on April 30 and November 1 of any calendar year in which the Commission chooses to submit a report.

Section 25. General Assembly Disapproval of the Report.

The General Assembly may disapprove the report of the Commission in whole within thirty legislative days after the report is filed by adoption of a joint resolution by a record vote of the majority of the members elected in each house. If the General Assembly does not adopt a joint resolution disapproving of the report, the Speaker of the House of Representatives and the President of the Senate shall certify the bill and it shall be presented to the Governor in accordance with Article 4, Section 9(a) of the Illinois Constitution. The Governor shall sign the bill and it shall become law. The bill shall not be certified if the General Assembly adopts a joint resolution disapproving of the report.

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