Bill Text: IL HB4246 | 2011-2012 | 97th General Assembly | Amended

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Bill Title: Amends the Illinois Pension Code. Makes a technical change in a Section concerning downstate police.

Sponsorship: Partisan Bill (Democrat 3)

Status: (Failed) 2013-01-08 - Session Sine Die [HB4246 Detail]

Download: Illinois-2011-HB4246-Amended.html

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Rep. Barbara Flynn Currie

Filed: 5/3/2012

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AMENDMENT TO HOUSE BILL 4246
AMENDMENT NO. ______. Amend House Bill 4246 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; State contributions;
certifications; vouchers 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.
(b) The General Assembly finds that for many years the

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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 through fiscal year 2012, it is
its goal and intention to continue this level of contribution
to the Fund in the future.
Beginning in State fiscal year 1999 and through fiscal year
2012, 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
this amendatory Act of 1998.
(c) For fiscal year 2013, the State shall contribute
$191,289,707 to the Fund.
(d) For fiscal year 2014 and each fiscal year thereafter,
the State shall contribute to the Fund an amount to be
determined by the Board in consultation with the Commission on
Government Forecasting and Accountability, equal to the sum of
the following:
(1) the State's share of the Fund's certified normal
cost for that fiscal year (excluding any amortization of
the unfunded accrued liability); and

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(2) a positive or negative amount equal to the net
amount of any increases or decreases in the Fund's
supplemental annual cost for that fiscal year that are not
attributable to the effects of lost investment earnings due
to underfunding as defined in subsection (g). Such
increases or decreases may include, but are not limited to,
those resulting from changes in benefits, changes in
actuarial assumptions adopted by the Board, differences
between actuarial assumptions and actual experience, and
variations in investment earnings other than lost
investment earnings due to underfunding.
(e) Annually, on or before November 15, the Board shall
certify to the Governor the total annual amount of the required
State contribution under this Section for the next fiscal year.
The certification shall include a copy of the actuarial
recommendations upon which it is based. The certification shall
also specifically identify and certify for that next fiscal
year: (i) the Fund's predicted normal cost; (ii) the estimated
amount of participant contributions under Section 17-130; and
(iii) each of the amounts determined under subdivisions (1) and
(2) of subsection (d) and the methodology and facts relied upon
in determining those amounts.
The certification for fiscal year 2013, however, shall be
made within 30 days after the effective date of this amendatory
Act of the 97th General Assembly and shall consist only of the
amount specified in subsection (c).

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(f) Beginning in State fiscal year 2013, the annual State
contribution required under this Section shall be payable to
the Fund in 12 substantially equal monthly installments.
On the 15th day of each month, or as soon thereafter as may
be practicable, the Board shall submit vouchers for payment of
State contributions to the Fund, in a total monthly amount of
one-twelfth of the annual amount of the required State
contribution certified under subsection (e). 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 appropriations for State contributions to the Fund for
the applicable fiscal year is less than the amount lawfully
vouchered under this subsection, the difference shall be paid
from the General Revenue Fund under the continuing
appropriation authority provided in Section 1.9 of the State
Pension Funds Continuing Appropriation Act.
(g) For the purposes of this Article:
"Lost investment earnings due to underfunding" means the
additional earnings on investments, if any, that the Fund would
have received during a particular fiscal year if the Fund had
been 100% funded on July 1, 2012, taking into consideration the
reduction of the unfunded accrued liability in existence on
July 1, 2012 under subdivision (b)(iv) of Section 17-129 prior
to that fiscal year.

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"Normal cost" means that part of the actuarial present
value of all future benefit payments and appropriate
administrative expenses assigned to a fiscal year under the
actuarial valuation method used by the Fund, excluding any
amortization of the unfunded accrued liability.
"The State's share of the Fund's certified normal cost"
means an amount equal to the Fund's certified normal cost for
the fiscal year minus the certified estimate for that fiscal
year of participant contributions required under Section
17-130.
"Supplemental annual cost" means that portion of the
unfunded accrued liability that is assigned to a fiscal year.
Unfunded accrued liability in existence on July 1, 2012 and
unfunded accrued liability accruing after that date that is
attributable to the effects of lost investment earnings due to
underfunding shall be assigned according to the schedule
adopted under subdivision (b)(iv) of Section 17-129. Unfunded
accrued liability that accrues on or after July 1, 2012 and is
not attributable to the effects of lost investment earnings due
to underfunding shall be assigned as the level annual amount
required to amortize that unfunded accrued liability over a
period not exceeding 30 years.
(h) It is declared to be the funding goal of the Fund to
achieve and maintain a funding ratio of 100%.
(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.)

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(40 ILCS 5/17-129) (from Ch. 108 1/2, par. 17-129)
Sec. 17-129. Board of Education Employer contributions;
certification; 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.

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(b) (i) Notwithstanding any other provision of this
Section, and notwithstanding any prior certification by the
Board under subsection (c) for fiscal year 2011, the Board of
Education's total required contribution to the Fund for fiscal
year 2011 under this Section is $187,000,000.
(ii) Notwithstanding any other provision of this Section,
the Board of Education's total required contribution to the
Fund for fiscal year 2012 under this Section is $192,000,000.
(iii) The Notwithstanding any other provision of this
Section, the Board of Education's total required contribution
to the Fund for fiscal year 2013 under this Section is
$196,000,000, without any credit or offset of the amount
payable by the State under Section 17-127.
(iv) For fiscal years 2014 through 2059, 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 to amortize 100% of the unfunded accrued
liability of the Fund in existence on July 1, 2012, plus any
additional unfunded accrued liability accruing after that date
that is attributable to the effects of lost investment earnings
due to underfunding (as defined in Section 17-127) bring the
total assets of the Fund up to 90% of the total actuarial
liabilities of the Fund by the end of fiscal year 2059. 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

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remaining to and including fiscal year 2059 and shall be
determined under the projected unit credit actuarial cost
method.
(v) Beginning in fiscal year 2060, or as soon as the
contributions under subdivision (iv) have paid off 100% of the
unfunded accrued liability of the Fund in existence on July 1,
2012 plus any additional unfunded accrued liability that has
accrued after that date and is attributable to the effects of
lost investment earnings due to underfunding, no further Board
of Education contribution shall be required. 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.
(vi) (Blank). Notwithstanding any other provision of this
subsection (b), 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.
(vii) (Blank). Any contribution by the State to or for the
benefit of the Fund, including, without limitation, 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

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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 Governor and 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. The Board
shall, if necessary, recertify the required contribution
amount under subdivision (b)(iii) for fiscal year 2013 in
accordance with this amendatory Act of the 97th General
Assembly.
(Source: P.A. 96-889, eff. 4-14-10.)
(40 ILCS 5/17-127.2 rep.)
Section 10. The Illinois Pension Code is amended by
repealing Section 17-127.2.
Section 15. The State Pension Funds Continuing
Appropriation Act is amended by adding Section 1.9 as follows:
(40 ILCS 15/1.9 new)
Sec. 1.9. Appropriation for Chicago Teachers' Pension
Fund. There is hereby appropriated from the General Revenue
Fund to the Public School Teachers' Pension and Retirement Fund
of Chicago, on a continuing monthly basis, the amount, if any,

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by which the total available amount of all other appropriations
to that Fund for the payment of State contributions required
under Section 17-127 of the Illinois Pension Code is less than
the total amount of the vouchers for required State
contributions lawfully submitted by the Fund for that month
under that Section.
Section 99. Effective date. This Act takes effect upon
becoming law.".