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Public Act 102-0764
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HB4320 Enrolled | LRB102 20083 RPS 28930 b |
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AN ACT concerning public employee benefits.
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Be it enacted by the People of the State of Illinois,
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represented in the General Assembly:
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Section 5. The Illinois Pension Code is amended by |
changing Section 15-155 as follows:
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(40 ILCS 5/15-155) (from Ch. 108 1/2, par. 15-155)
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Sec. 15-155. Employer contributions.
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(a) The State of Illinois shall make contributions by |
appropriations of
amounts which, together with the other |
employer contributions from trust,
federal, and other funds, |
employee contributions, income from investments,
and other |
income of this System, will be sufficient to meet the cost of
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maintaining and administering the System on a 90% funded basis |
in accordance
with actuarial recommendations.
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The Board shall determine the amount of State |
contributions required for
each fiscal year on the basis of |
the actuarial tables and other assumptions
adopted by the |
Board and the recommendations of the actuary, using the |
formula
in subsection (a-1).
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(a-1) For State fiscal years 2012 through 2045, the |
minimum contribution
to the System to be made by the State for |
each fiscal year shall be an amount
determined by the System to |
be sufficient to bring the total assets of the
System up to 90% |
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of the total actuarial liabilities of the System by the end of
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State fiscal year 2045. In making these determinations, the |
required State
contribution shall be calculated each year as a |
level percentage of payroll
over the years remaining to and |
including fiscal year 2045 and shall be
determined under the |
projected unit credit actuarial cost method.
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For each of State fiscal years 2018, 2019, and 2020, the |
State shall make an additional contribution to the System |
equal to 2% of the total payroll of each employee who is deemed |
to have elected the benefits under Section 1-161 or who has |
made the election under subsection (c) of Section 1-161. |
A change in an actuarial or investment assumption that |
increases or
decreases the required State contribution and |
first
applies in State fiscal year 2018 or thereafter shall be
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implemented in equal annual amounts over a 5-year period
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beginning in the State fiscal year in which the actuarial
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change first applies to the required State contribution. |
A change in an actuarial or investment assumption that |
increases or
decreases the required State contribution and |
first
applied to the State contribution in fiscal year 2014, |
2015, 2016, or 2017 shall be
implemented: |
(i) as already applied in State fiscal years before |
2018; and |
(ii) in the portion of the 5-year period beginning in |
the State fiscal year in which the actuarial
change first |
applied that occurs in State fiscal year 2018 or |
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thereafter, by calculating the change in equal annual |
amounts over that 5-year period and then implementing it |
at the resulting annual rate in each of the remaining |
fiscal years in that 5-year period. |
For State fiscal years 1996 through 2005, the State |
contribution to
the System, as a percentage of the applicable |
employee payroll, shall be
increased in equal annual |
increments so that by State fiscal year 2011, the
State is |
contributing at the rate required under this Section.
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Notwithstanding any other provision of this Article, the |
total required State
contribution for State fiscal year 2006 |
is $166,641,900.
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Notwithstanding any other provision of this Article, the |
total required State
contribution for State fiscal year 2007 |
is $252,064,100.
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For each of State fiscal years 2008 through 2009, the |
State contribution to
the System, as a percentage of the |
applicable employee payroll, shall be
increased in equal |
annual increments from the required State contribution for |
State fiscal year 2007, so that by State fiscal year 2011, the
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State is contributing at the rate otherwise required under |
this Section.
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Notwithstanding any other provision of this Article, the |
total required State contribution for State fiscal year 2010 |
is $702,514,000 and shall be made from the State Pensions Fund |
and proceeds of bonds sold in fiscal year 2010 pursuant to |
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Section 7.2 of the General Obligation Bond Act, less (i) the |
pro rata share of bond sale expenses determined by the |
System's share of total bond proceeds, (ii) any amounts |
received from the General Revenue Fund in fiscal year 2010, |
(iii) any reduction in bond proceeds due to the issuance of |
discounted bonds, if applicable. |
Notwithstanding any other provision of this Article, the
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total required State contribution for State fiscal year 2011 |
is
the amount recertified by the System on or before April 1, |
2011 pursuant to Section 15-165 and shall be made from the |
State Pensions Fund and
proceeds of bonds sold in fiscal year |
2011 pursuant to Section
7.2 of the General Obligation Bond |
Act, less (i) the pro rata
share of bond sale expenses |
determined by the System's share of
total bond proceeds, (ii) |
any amounts received from the General
Revenue Fund in fiscal |
year 2011, and (iii) any reduction in bond
proceeds due to the |
issuance of discounted bonds, if
applicable. |
Beginning in State fiscal year 2046, the minimum State |
contribution for
each fiscal year shall be the amount needed |
to maintain the total assets of
the System at 90% of the total |
actuarial liabilities of the System.
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Amounts received by the System pursuant to Section 25 of |
the Budget Stabilization Act or Section 8.12 of the State |
Finance Act in any fiscal year do not reduce and do not |
constitute payment of any portion of the minimum State |
contribution required under this Article in that fiscal year. |
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Such amounts shall not reduce, and shall not be included in the |
calculation of, the required State contributions under this |
Article in any future year until the System has reached a |
funding ratio of at least 90%. A reference in this Article to |
the "required State contribution" or any substantially similar |
term does not include or apply to any amounts payable to the |
System under Section 25 of the Budget Stabilization Act. |
Notwithstanding any other provision of this Section, the |
required State
contribution for State fiscal year 2005 and for |
fiscal year 2008 and each fiscal year thereafter, as
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calculated under this Section and
certified under Section |
15-165, shall not exceed an amount equal to (i) the
amount of |
the required State contribution that would have been |
calculated under
this Section for that fiscal year if the |
System had not received any payments
under subsection (d) of |
Section 7.2 of the General Obligation Bond Act, minus
(ii) the |
portion of the State's total debt service payments for that |
fiscal
year on the bonds issued in fiscal year 2003 for the |
purposes of that Section 7.2, as determined
and certified by |
the Comptroller, that is the same as the System's portion of
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the total moneys distributed under subsection (d) of Section |
7.2 of the General
Obligation Bond Act. In determining this |
maximum for State fiscal years 2008 through 2010, however, the |
amount referred to in item (i) shall be increased, as a |
percentage of the applicable employee payroll, in equal |
increments calculated from the sum of the required State |
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contribution for State fiscal year 2007 plus the applicable |
portion of the State's total debt service payments for fiscal |
year 2007 on the bonds issued in fiscal year 2003 for the |
purposes of Section 7.2 of the General
Obligation Bond Act, so |
that, by State fiscal year 2011, the
State is contributing at |
the rate otherwise required under this Section.
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(a-2) Beginning in fiscal year 2018, each employer under |
this Article shall pay to the System a required contribution |
determined as a percentage of projected payroll and sufficient |
to produce an annual amount equal to: |
(i) for each of fiscal years 2018, 2019, and 2020, the |
defined benefit normal cost of the defined benefit plan, |
less the employee contribution, for each employee of that |
employer who has elected or who is deemed to have elected |
the benefits under Section 1-161 or who has made the |
election under subsection (c) of Section 1-161; for fiscal |
year 2021 and each fiscal year thereafter, the defined |
benefit normal cost of the defined benefit plan, less the |
employee contribution, plus 2%, for each employee of that |
employer who has elected or who is deemed to have elected |
the benefits under Section 1-161 or who has made the |
election under subsection (c) of Section 1-161; plus |
(ii) the amount required for that fiscal year to |
amortize any unfunded actuarial accrued liability |
associated with the present value of liabilities |
attributable to the employer's account under Section |
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15-155.2, determined
as a level percentage of payroll over |
a 30-year rolling amortization period. |
In determining contributions required under item (i) of |
this subsection, the System shall determine an aggregate rate |
for all employers, expressed as a percentage of projected |
payroll. |
In determining the contributions required under item (ii) |
of this subsection, the amount shall be computed by the System |
on the basis of the actuarial assumptions and tables used in |
the most recent actuarial valuation of the System that is |
available at the time of the computation. |
The contributions required under this subsection (a-2) |
shall be paid by an employer concurrently with that employer's |
payroll payment period. The State, as the actual employer of |
an employee, shall make the required contributions under this |
subsection. |
As used in this subsection, "academic year" means the |
12-month period beginning September 1. |
(b) If an employee is paid from trust or federal funds, the |
employer
shall pay to the Board contributions from those funds |
which are
sufficient to cover the accruing normal costs on |
behalf of the employee.
However, universities having employees |
who are compensated out of local
auxiliary funds, income |
funds, or service enterprise funds are not required
to pay |
such contributions on behalf of those employees. The local |
auxiliary
funds, income funds, and service enterprise funds of |
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universities shall not be
considered trust funds for the |
purpose of this Article, but funds of alumni
associations, |
foundations, and athletic associations which are affiliated |
with
the universities included as employers under this Article |
and other employers
which do not receive State appropriations |
are considered to be trust funds for
the purpose of this |
Article.
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(b-1) The City of Urbana and the City of Champaign shall |
each make
employer contributions to this System for their |
respective firefighter
employees who participate in this |
System pursuant to subsection (h) of Section
15-107. The rate |
of contributions to be made by those municipalities shall
be |
determined annually by the Board on the basis of the actuarial |
assumptions
adopted by the Board and the recommendations of |
the actuary, and shall be
expressed as a percentage of salary |
for each such employee. The Board shall
certify the rate to the |
affected municipalities as soon as may be practical.
The |
employer contributions required under this subsection shall be |
remitted by
the municipality to the System at the same time and |
in the same manner as
employee contributions.
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(c) Through State fiscal year 1995: The total employer |
contribution shall
be apportioned among the various funds of |
the State and other employers,
whether trust, federal, or |
other funds, in accordance with actuarial procedures
approved |
by the Board. State of Illinois contributions for employers |
receiving
State appropriations for personal services shall be |
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payable from appropriations
made to the employers or to the |
System. The contributions for Class I
community colleges |
covering earnings other than those paid from trust and
federal |
funds, shall be payable solely from appropriations to the |
Illinois
Community College Board or the System for employer |
contributions.
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(d) Beginning in State fiscal year 1996, the required |
State contributions
to the System shall be appropriated |
directly to the System and shall be payable
through vouchers |
issued in accordance with subsection (c) of Section 15-165, |
except as provided in subsection (g).
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(e) The State Comptroller shall draw warrants payable to |
the System upon
proper certification by the System or by the |
employer in accordance with the
appropriation laws and this |
Code.
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(f) Normal costs under this Section means liability for
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pensions and other benefits which accrues to the System |
because of the
credits earned for service rendered by the |
participants during the
fiscal year and expenses of |
administering the System, but shall not
include the principal |
of or any redemption premium or interest on any bonds
issued by |
the Board or any expenses incurred or deposits required in
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connection therewith.
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(g) If the amount of a participant's earnings for any |
academic year used to determine the final rate of earnings, |
determined on a full-time equivalent basis, exceeds the amount |
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of his or her earnings with the same employer for the previous |
academic year, determined on a full-time equivalent basis, by |
more than 6%, the participant's employer shall pay to the |
System, in addition to all other payments required under this |
Section and in accordance with guidelines established by the |
System, the present value of the increase in benefits |
resulting from the portion of the increase in earnings that is |
in excess of 6%. This present value shall be computed by the |
System on the basis of the actuarial assumptions and tables |
used in the most recent actuarial valuation of the System that |
is available at the time of the computation. The System may |
require the employer to provide any pertinent information or |
documentation. |
Whenever it determines that a payment is or may be |
required under this subsection (g), the System shall calculate |
the amount of the payment and bill the employer for that |
amount. The bill shall specify the calculations used to |
determine the amount due. If the employer disputes the amount |
of the bill, it may, within 30 days after receipt of the bill, |
apply to the System in writing for a recalculation. The |
application must specify in detail the grounds of the dispute |
and, if the employer asserts that the calculation is subject |
to subsection (h), (h-5), or (i) of this Section, must include |
an affidavit setting forth and attesting to all facts within |
the employer's knowledge that are pertinent to the |
applicability of that subsection. Upon receiving a timely |
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application for recalculation, the System shall review the |
application and, if appropriate, recalculate the amount due.
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The employer contributions required under this subsection |
(g) may be paid in the form of a lump sum within 90 days after |
receipt of the bill. If the employer contributions are not |
paid within 90 days after receipt of the bill, then interest |
will be charged at a rate equal to the System's annual |
actuarially assumed rate of return on investment compounded |
annually from the 91st day after receipt of the bill. Payments |
must be concluded within 3 years after the employer's receipt |
of the bill. |
When assessing payment for any amount due under this |
subsection (g), the System shall include earnings, to the |
extent not established by a participant under Section |
15-113.11 or 15-113.12, that would have been paid to the |
participant had the participant not taken (i) periods of |
voluntary or involuntary furlough occurring on or after July |
1, 2015 and on or before June 30, 2017 or (ii) periods of |
voluntary pay reduction in lieu of furlough occurring on or |
after July 1, 2015 and on or before June 30, 2017. Determining |
earnings that would have been paid to a participant had the |
participant not taken periods of voluntary or involuntary |
furlough or periods of voluntary pay reduction shall be the |
responsibility of the employer, and shall be reported in a |
manner prescribed by the System. |
This subsection (g) does not apply to (1) Tier 2 hybrid |
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plan members and (2) Tier 2 defined benefit members who first |
participate under this Article on or after the implementation |
date of the Optional Hybrid Plan. |
(g-1) (Blank). |
(h) This subsection (h) applies only to payments made or |
salary increases given on or after June 1, 2005 but before July |
1, 2011. The changes made by Public Act 94-1057 shall not |
require the System to refund any payments received before July |
31, 2006 (the effective date of Public Act 94-1057). |
When assessing payment for any amount due under subsection |
(g), the System shall exclude earnings increases paid to |
participants under contracts or collective bargaining |
agreements entered into, amended, or renewed before June 1, |
2005.
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When assessing payment for any amount due under subsection |
(g), the System shall exclude earnings increases paid to a |
participant at a time when the participant is 10 or more years |
from retirement eligibility under Section 15-135.
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When assessing payment for any amount due under subsection |
(g), the System shall exclude earnings increases resulting |
from overload work, including a contract for summer teaching, |
or overtime when the employer has certified to the System, and |
the System has approved the certification, that: (i) in the |
case of overloads (A) the overload work is for the sole purpose |
of academic instruction in excess of the standard number of |
instruction hours for a full-time employee occurring during |
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the academic year that the overload is paid and (B) the |
earnings increases are equal to or less than the rate of pay |
for academic instruction computed using the participant's |
current salary rate and work schedule; and (ii) in the case of |
overtime, the overtime was necessary for the educational |
mission. |
When assessing payment for any amount due under subsection |
(g), the System shall exclude any earnings increase resulting |
from (i) a promotion for which the employee moves from one |
classification to a higher classification under the State |
Universities Civil Service System, (ii) a promotion in |
academic rank for a tenured or tenure-track faculty position, |
or (iii) a promotion that the Illinois Community College Board |
has recommended in accordance with subsection (k) of this |
Section. These earnings increases shall be excluded only if |
the promotion is to a position that has existed and been filled |
by a member for no less than one complete academic year and the |
earnings increase as a result of the promotion is an increase |
that results in an amount no greater than the average salary |
paid for other similar positions. |
(h-5) When assessing payment for any amount due under |
subsection (g), the System shall exclude any earnings increase |
paid in an academic year beginning on or after July 1, 2020 |
resulting from overload work performed in an academic year |
subsequent to an academic year in which the employer was |
unable to offer or allow to be conducted overload work due to |
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an emergency declaration limiting such activities. |
(i) When assessing payment for any amount due under |
subsection (g), the System shall exclude any salary increase |
described in subsection (h) of this Section given on or after |
July 1, 2011 but before July 1, 2014 under a contract or |
collective bargaining agreement entered into, amended, or |
renewed on or after June 1, 2005 but before July 1, 2011. |
Except as provided in subsection (h-5) Notwithstanding any |
other provision of this Section , any payments made or salary |
increases given after June 30, 2014 shall be used in assessing |
payment for any amount due under subsection (g) of this |
Section.
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(j) The System shall prepare a report and file copies of |
the report with the Governor and the General Assembly by |
January 1, 2007 that contains all of the following |
information: |
(1) The number of recalculations required by the |
changes made to this Section by Public Act 94-1057 for |
each employer. |
(2) The dollar amount by which each employer's |
contribution to the System was changed due to |
recalculations required by Public Act 94-1057. |
(3) The total amount the System received from each |
employer as a result of the changes made to this Section by |
Public Act 94-4. |
(4) The increase in the required State contribution |
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resulting from the changes made to this Section by Public |
Act 94-1057. |
(j-5) For State fiscal years beginning on or after July 1, |
2017, if the amount of a participant's earnings for any State |
fiscal year exceeds the amount of the salary set by law for the |
Governor that is in effect on July 1 of that fiscal year, the |
participant's employer shall pay to the System, in addition to |
all other payments required under this Section and in |
accordance with guidelines established by the System, an |
amount determined by the System to be equal to the employer |
normal cost, as established by the System and expressed as a |
total percentage of payroll, multiplied by the amount of |
earnings in excess of the amount of the salary set by law for |
the Governor. This amount shall be computed by the System on |
the basis of the actuarial assumptions and tables used in the |
most recent actuarial valuation of the System that is |
available at the time of the computation. The System may |
require the employer to provide any pertinent information or |
documentation. |
Whenever it determines that a payment is or may be |
required under this subsection, the System shall calculate the |
amount of the payment and bill the employer for that amount. |
The bill shall specify the calculation used to determine the |
amount due. If the employer disputes the amount of the bill, it |
may, within 30 days after receipt of the bill, apply to the |
System in writing for a recalculation. The application must |
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specify in detail the grounds of the dispute. Upon receiving a |
timely application for recalculation, the System shall review |
the application and, if appropriate, recalculate the amount |
due. |
The employer contributions required under this subsection |
may be paid in the form of a lump sum within 90 days after |
issuance of the bill. If the employer contributions are not |
paid within 90 days after issuance of the bill, then interest |
will be charged at a rate equal to the System's annual |
actuarially assumed rate of return on investment compounded |
annually from the 91st day after issuance of the bill. All |
payments must be received within 3 years after issuance of the |
bill. If the employer fails to make complete payment, |
including applicable interest, within 3 years, then the System |
may, after giving notice to the employer, certify the |
delinquent amount to the State Comptroller, and the |
Comptroller shall thereupon deduct the certified delinquent |
amount from State funds payable to the employer and pay them |
instead to the System. |
This subsection (j-5) does not apply to a participant's |
earnings to the extent an employer pays the employer normal |
cost of such earnings. |
The changes made to this subsection (j-5) by Public Act |
100-624 are intended to apply retroactively to July 6, 2017 |
(the effective date of Public Act 100-23). |
(k) The Illinois Community College Board shall adopt rules |
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for recommending lists of promotional positions submitted to |
the Board by community colleges and for reviewing the |
promotional lists on an annual basis. When recommending |
promotional lists, the Board shall consider the similarity of |
the positions submitted to those positions recognized for |
State universities by the State Universities Civil Service |
System. The Illinois Community College Board shall file a copy |
of its findings with the System. The System shall consider the |
findings of the Illinois Community College Board when making |
determinations under this Section. The System shall not |
exclude any earnings increases resulting from a promotion when |
the promotion was not submitted by a community college. |
Nothing in this subsection (k) shall require any community |
college to submit any information to the Community College |
Board.
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(l) For purposes of determining the required State |
contribution to the System, the value of the System's assets |
shall be equal to the actuarial value of the System's assets, |
which shall be calculated as follows: |
As of June 30, 2008, the actuarial value of the System's |
assets shall be equal to the market value of the assets as of |
that date. In determining the actuarial value of the System's |
assets for fiscal years after June 30, 2008, any actuarial |
gains or losses from investment return incurred in a fiscal |
year shall be recognized in equal annual amounts over the |
5-year period following that fiscal year. |
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(m) For purposes of determining the required State |
contribution to the system for a particular year, the |
actuarial value of assets shall be assumed to earn a rate of |
return equal to the system's actuarially assumed rate of |
return. |
(Source: P.A. 101-10, eff. 6-5-19; 101-81, eff. 7-12-19; |
102-16, eff. 6-17-21; 102-558, eff. 8-20-21.)
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Section 90. The State Mandates Act is amended by adding |
Section 8.46 as follows:
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(30 ILCS 805/8.46 new) |
Sec. 8.46. Exempt mandate. Notwithstanding Sections 6 and |
8 of this Act, no reimbursement by the State is required for |
the implementation of any mandate created by this amendatory |
Act of the 102nd General Assembly.
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Section 99. Effective date. This Act takes effect upon |
becoming law.
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