State of Illinois
92nd General Assembly
Legislation

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92_SB0191

 
                                               LRB9203358EGfg

 1        AN ACT in relation to public employee benefits.

 2        Be  it  enacted  by  the People of the State of Illinois,
 3    represented in the General Assembly:

 4        Section 5.  The  Illinois  Pension  Code  is  amended  by
 5    changing Sections 17-127 and 17-130.1 as follows:

 6        (40 ILCS 5/17-127) (from Ch. 108 1/2, par. 17-127)
 7        Sec. 17-127. Financing; revenues for the Fund.
 8        (a)  The  revenues  for  the  Fund  shall consist of: (1)
 9    amounts paid into the Fund by contributors thereto  and  from
10    employer contributions and State appropriations in accordance
11    with  this Article; (2) amounts contributed to the Fund by an
12    Employer; (3) amounts contributed to the Fund pursuant to any
13    law  now  in  force  or  hereafter   to   be   enacted;   (4)
14    contributions  from any other source; and (5) the earnings on
15    investments of the Fund.
16        (b)  The General Assembly finds that for many  years  the
17    State  has  contributed  to the Fund an annual amount that is
18    between 20% and  30%  of  the  amount  of  the  annual  State
19    contribution  to  the  Article  16 retirement system, and the
20    General Assembly declares that it is its goal  and  intention
21    to  continue  this  level  of contribution to the Fund in the
22    future.
23        (b-5)  Beginning In State fiscal  year  1999,  the  State
24    shall  include  in  its  annual  contribution  to the Fund an
25    additional amount equal to 0.544% of the Fund's total teacher
26    payroll; except that this additional contribution need not be
27    made in a fiscal year if  the  Board  has  certified  in  the
28    previous  fiscal  year  that the Fund is at least 90% funded,
29    based on actuarial  determinations.  These  additional  State
30    contributions are intended to offset a portion of the cost to
31    the  Fund  of  the increases in retirement benefits resulting
 
                            -2-                LRB9203358EGfg
 1    from Public Act 90-582 this amendatory Act of 1998.
 2        (c)  For each State fiscal year ending  after  2001,  the
 3    State   shall   contribute   to   the   Fund,   by  means  of
 4    appropriations from the Common School  Fund  or  other  State
 5    funds,  an  amount not less than the sum of (i) the amount so
 6    appropriated for the State's fiscal year ending in 2001, plus
 7    (ii) 20% of the amount, if any, by  which  the  total  amount
 8    appropriated  for contributions by the State to the Teachers'
 9    Retirement System of the  State  of  Illinois  under  Section
10    16-158 in the year of contribution exceeds the amount of such
11    appropriations for the State fiscal year ending in 2001.
12        (d)  Beginning  in  the State fiscal year ending in 2002,
13    on the 15th day of each month, or as soon after that date  as
14    is  practicable,  the Board shall submit vouchers for payment
15    of State contributions to the Fund, in a  monthly  amount  of
16    one-twelfth  of  the required annual State contribution under
17    subsection (c) of this  Section.   If  that  required  annual
18    contribution  changes  during  the  State  fiscal  year,  the
19    remaining  monthly amounts shall be adjusted in equal amounts
20    so that the total amount for which vouchers are submitted for
21    the year equals that  required  annual  contribution.   These
22    vouchers shall be paid by the State Comptroller and Treasurer
23    by  warrants  drawn on the funds appropriated to the Fund for
24    that fiscal year.  If, in any  month,  the  amount  remaining
25    unexpended  from  all  other State appropriations to the Fund
26    for that State fiscal year is less than the amount for  which
27    vouchers  are  lawfully  submitted  under  this  Section, the
28    difference shall be paid under the  continuing  appropriation
29    available  for  that  purpose pursuant to the Chicago Teacher
30    Pension Fund Continuing Appropriation Act.
31        (e)  For  the  purposes  of  this  subsection,   "minimum
32    funding requirement" for any fiscal year means the greater of
33    (1)  the  minimum Board of Education contribution to the Fund
34    under Section 17-129 for a fiscal  year  (calculated  without
 
                            -3-                LRB9203358EGfg
 1    regard to any contribution of the State to or for the benefit
 2    of  the  Fund)  or (2) the amount appropriated to the Fund by
 3    the State for the State's fiscal year ending in 2001.
 4        To the extent that the State  contribution  to  the  Fund
 5    under  this  Section in a State fiscal year ending after 2001
 6    exceeds the minimum funding requirement for that fiscal year,
 7    that excess amount shall be treated for  all  purposes  as  a
 8    payment (and release) of an equal amount of any obligation of
 9    the Board of Education to its employees to make contributions
10    to  the Fund on behalf of employees under Section 17-130.1 in
11    that fiscal year and shall be treated for all purposes in the
12    same manner and to the same extent as employee  contributions
13    made by employees and deducted from salary, to the extent the
14    Board  of  Education would be so required by the terms of its
15    employment of employees who are members of the Fund  to  make
16    such a contribution in that State fiscal year.  The amount so
17    to  be  applied  in any State fiscal year shall be applied by
18    the Fund, as nearly  as  may  be  practicable,  on  an  equal
19    monthly  basis,  adjusting  the  amount as necessary upon any
20    change in the appropriations or in  the  obligations  of  the
21    Board of Education.
22        Any  amounts  received  by  the  Fund from the State in a
23    State fiscal  year  ending  after  2001  (together  with  any
24    amounts  carried  forward  from  a  previous  year under this
25    provision) in excess of the sum of (i)  the  minimum  funding
26    requirement for that year and (ii) the amount treated in that
27    year  as a payment (and release) by the Board of Education of
28    Board of  Education  obligations  to  make  contributions  on
29    behalf  of  employees under Section 17-130.1, plus investment
30    earnings realized by the Fund on that excess, shall  be  held
31    by  the  Fund  and  carried  forward to the next State fiscal
32    year, to be used for the purposes for which appropriations to
33    the Fund for that next fiscal year may  be  used  under  this
34    Section but shall not be a credit against or an offset of the
 
                            -4-                LRB9203358EGfg
 1    minimum funding requirement for the next fiscal year.
 2    (Source:  P.A.  90-548,  eff.  12-4-97;  90-566, eff. 1-2-98;
 3    90-582, eff. 5-27-98; 90-655, eff. 7-30-98.)

 4        (40 ILCS 5/17-130.1) (from Ch. 108 1/2, par. 17-130.1)
 5        Sec.  17-130.1.   Employer  contributions  on  behalf  of
 6    employees.  An Employer and the Board may make and may  incur
 7    an   obligation  to  make  contributions  on  behalf  of  its
 8    employees  in  an  amount  not   to   exceed   the   employee
 9    contributions required by Section 17-130 for all compensation
10    earned  after  September  21,  1981.   If the Employer or the
11    Board of Education determines not to make such  contributions
12    or incur an obligation to make such contributions, the amount
13    that  it  could  have  contributed on behalf of its employees
14    shall continue to be deducted from salary.  If  contributions
15    are  made  by  an  Employer  or  the  Board  on behalf of its
16    employees they shall be treated as employer contributions  in
17    determining  tax  treatment  under the United States Internal
18    Revenue Code.  An  Employer  or  the  Board  may  make  these
19    contributions  on  behalf  of its employees by a reduction in
20    the cash salary of the employee or by  an  offset  against  a
21    future  salary increase or by a combination of a reduction in
22    salary and offset  against  a  future  salary  increase.   An
23    Employer  or the Board shall pay these employee contributions
24    from the same source of funds which is used in paying  salary
25    to the employee or from amounts treated as made under Section
26    17-127,   or   it   may   also  or  alternatively  make  such
27    contributions from the proceeds  of  the  tax  authorized  by
28    Section   34-60   of   the   School   Code.    Such  employee
29    contributions shall be  treated  for  all  purposes  of  this
30    Article  17  in  the  same  manner  and to the same extent as
31    employee contributions made by employees  and  deducted  from
32    salary;  provided,  however,  that  contributions made by the
33    Board of Education on behalf of its employees which are to be
 
                            -5-                LRB9203358EGfg
 1    paid from the proceeds of the tax,  as  provided  in  Section
 2    34-60  of  the School Code, shall not be treated as teachers'
 3    pension contributions for the purposes of Section  17-132  of
 4    the   Illinois  Pension  Code,  and  provided  further,  that
 5    contributions which are made by the  Board  of  Education  on
 6    behalf  of its employees shall not be treated as a pension or
 7    retirement obligation of the Board of Education for  purposes
 8    of Section 12 of "An Act in relation to State revenue sharing
 9    with local governmental entities", approved July 31, 1969.
10    (Source: P.A. 90-566, eff. 1-2-98.)

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