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90_HB0356
40 ILCS 5/17-127 from Ch. 108 1/2, par. 17-127
40 ILCS 5/22-1001 from Ch. 108 1/2, par. 22-1001
40 ILCS 5/22-1003 from Ch. 108 1/2, par. 22-1003
Amends the Illinois Pension Code to provide additional
State funding for the Chicago Teachers Pension Fund.
Increases the annual State contribution to the Fund over a 7
year phase-in period beginning in fiscal year 1999, so that
by fiscal year 2006, the annual State contribution is
sufficient, with the other revenues available to the Fund, to
meet the normal cost and amortize the unfunded liabilities of
the Fund over a period of 40 years. Effective immediately.
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1 AN ACT to provide additional State funding for the Public
2 School Teachers' Pension and Retirement Fund of Chicago,
3 amending a named Act.
4 Be it enacted by the People of the State of Illinois,
5 represented in the General Assembly:
6 Section 5. The Illinois Pension Code is amended by
7 changing Sections 17-127, 22-1001, and 22-1003 as follows:
8 (40 ILCS 5/17-127) (from Ch. 108 1/2, par. 17-127)
9 Sec. 17-127. Financing; revenues for the Fund.
10 (a) The revenues for the Fund shall consist of: (1)
11 amounts paid into the Fund by contributors thereto and from
12 taxes and State appropriations in accordance with this
13 Article; (2) amounts contributed to the Fund pursuant to any
14 law now in force or hereafter to be enacted; (3)
15 contributions from any other source; and (4) the earnings on
16 investments.
17 (b) The General Assembly finds that for many years the
18 State has contributed to the Fund an annual amount that is
19 between 20% and 30% of the amount of the annual State
20 contribution to the Article 16 retirement system, and the
21 General Assembly declares that it is its goal and intention
22 to continue this level of contribution to the Fund in State
23 fiscal years 1995, 1996, 1997, and 1998 the future.
24 (c) Beginning in State fiscal year 1999, the State
25 contribution, as a percentage of the applicable employee
26 payroll, shall be increased in equal annual increments over a
27 7 year phase-in period until the following funding level is
28 achieved. Beginning in State fiscal year 2006, the State of
29 Illinois shall make annual contributions to the Fund that are
30 sufficient, in combination with the the other revenues
31 available to the Fund, to meet the normal cost and amortize
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1 the unfunded liability of the Fund over 40 years (beginning
2 in fiscal year 2006) as a level percentage of payroll,
3 determined under the projected unit credit actuarial cost
4 method.
5 (Source: P.A. 88-593, eff. 8-22-94.)
6 (40 ILCS 5/22-1001) (from Ch. 108 1/2, par. 22-1001)
7 Sec. 22-1001. Submission of information. By March 1 of
8 each year, the retirement systems created under Articles 2,
9 14, 15, 16, 17, and 18 of this Code shall each submit the
10 following information to the Pension Laws Commission:
11 (1) the most recent actuarial valuation computed using
12 the projected unit credit actuarial cost method for
13 retirement and ancillary benefits.
14 (2) a full disclosure of the provisions of the plan;
15 economic, mortality, termination, and demographic assumptions
16 used for the valuation; methods used to determine the
17 actuarial values; the impact of significant changes in the
18 actuarial assumptions and methods; the most recent experience
19 review; and other information affecting the plan's actuarial
20 status.
21 (3) the State's share of the amount necessary to fund
22 the normal cost plus interest on the unfunded accrued
23 liability for the next fiscal year as determined by the
24 projected unit credit computations.
25 (4) a five-year history of the system's liabilities,
26 assets (valued at cost), and unfunded liabilities.
27 (5) the July 1 market value of system assets and a
28 five-year history of annual and annualized investment returns
29 of the system's total portfolio and each segment of the
30 portfolio; and
31 (6) measures of financial status, including ten-year
32 trends of: unfunded liabilities, funded ratios, quick
33 liability ratios, current reserves, and other solvency tests
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1 requested by the Commission.
2 For plan years ending prior to December 31, 1984, the
3 historical data submitted by the retirement systems pursuant
4 to items (4) and (6) above may be based on a cost method
5 other than the projected unit credit actuarial cost method.
6 In submitting the data, the retirement systems shall specify
7 the method used.
8 (Source: P.A. 89-113, eff. 7-7-95.)
9 (40 ILCS 5/22-1003) (from Ch. 108 1/2, par. 22-1003)
10 Sec. 22-1003. The Pension Laws Commission shall receive
11 the information specified in Section 22-1001 and Section
12 22-1002 of this Act. Commission staff shall examine the
13 information and submit a report of the analysis thereof to
14 the General Assembly. The report shall also include either
15 an analysis of the effect of the different economic
16 assumptions used by the 6 5 systems, or supplemental
17 valuations using the same economic assumptions for all 6 5
18 systems. The Commission shall compare (1) each system's
19 required actuarial funding computed using the projected unit
20 credit actuarial cost method, and (2) the required State
21 contribution levels established by Public Act 88-593. The
22 report shall also identify the amount of the required funding
23 for each system expected to come from (i) budgeted annual
24 appropriations and (ii) continuing appropriations under the
25 State Pension Funds Continuing Appropriation Act.
26 The Commission shall also compute multiple year
27 projections showing the effect on system liabilities and the
28 State's annual cost (1) if the systems were to be funded
29 according to actuarial recommendations that the Commission
30 deems reasonable, (2) if each system were to be funded
31 according to recommendations made by the system's actuary,
32 and (3) if the systems were to be funded according to the
33 required State contribution levels established by Public Act
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1 88-593; including (i) comparisons of State costs with
2 projected benefit payments, payroll, and the general funds
3 budget, and (ii) comparisons of unfunded liabilities, funded
4 ratios, solvency tests, and projected reserves. The
5 Commission may conduct additional analyses and projections as
6 it deems useful.
7 (Source: P.A. 89-113, eff. 7-7-95.)
8 Section 99. Effective date. This Act takes effect upon
9 becoming law.