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92_SB0783 LRB9204819LDpc 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)BeginningIn 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 madein a fiscal yearif 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- LRB9204819LDpc 1 from Public Act 90-582this 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- LRB9204819LDpc 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- LRB9204819LDpc 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 such27contributions from the proceeds of the tax authorized by28Section 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 the33Board of Education on behalf of its employees which are to be-5- LRB9204819LDpc 1paid from the proceeds of the tax, as provided in Section234-60 of the School Code, shall not be treated as teachers'3pension contributions for the purposes of Section 17-132 of4the 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.) 11 Section 99. Effective date. This Act takes effect upon 12 becoming law.