Bill Text: IL SB0451 | 2013-2014 | 98th General Assembly | Amended

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Bill Title: Amends the Illinois Pension Code. Makes a technical change in a Section concerning the Illinois Municipal Retirement Fund.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Failed) 2015-01-13 - Session Sine Die [SB0451 Detail]

Download: Illinois-2013-SB0451-Amended.html

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Sen. John G. Mulroe

Filed: 2/26/2014

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AMENDMENT TO SENATE BILL 451
AMENDMENT NO. ______. Amend Senate Bill 451 by replacing
everything after the enacting clause with the following:
"Section 5. The Illinois Pension Code is amended by
changing Sections 5-168, 6-165, and 17-129 as follows:
(40 ILCS 5/5-168) (from Ch. 108 1/2, par. 5-168)
Sec. 5-168. Financing.
(a) Except as expressly provided in this Section, the city
shall levy a tax annually upon all taxable property therein for
the purpose of providing revenue for the fund.
The tax shall be at a rate that will produce a sum which,
when added to the amounts deducted from the policemen's
salaries and the amounts deposited in accordance with
subsection (g), is sufficient for the purposes of the fund.
For the years 1968 and 1969, the city council shall levy a
tax annually at a rate on the dollar of the assessed valuation

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of all taxable property that will produce, when extended, not
to exceed $9,700,000. Beginning with the year 1970 and through
2014, the city council shall levy a tax annually at a rate on
the dollar of the assessed valuation of all taxable property
that will produce when extended an amount not to exceed the
total amount of contributions by the policemen to the Fund made
in the calendar year 2 years before the year for which the
applicable annual tax is levied, multiplied by 1.40 for the tax
levy year 1970; by 1.50 for the year 1971; by 1.65 for 1972; by
1.85 for 1973; by 1.90 for 1974; by 1.97 for 1975 through 1981;
by 2.00 for 1982 and for each year through 2014. Beginning in
2015, the city council shall levy a tax annually at a rate on
the dollar of the assessed valuation of all taxable property
that will produce when extended an annual amount that is equal
to (1) the normal cost to the Fund, plus (2) an annual amount
sufficient to bring the total assets of the Fund up to 90% of
the total actuarial liabilities of the Fund by the end of
fiscal year 2040, as annually updated and determined by an
enrolled actuary employed by the Illinois Department of
Insurance or by an enrolled actuary retained by the Fund or the
city. In making these determinations, the required minimum
employer contribution shall be calculated each year as a level
percentage of payroll over the years remaining up to and
including fiscal year 2040 and shall be determined under the
projected unit credit actuarial cost method. For the purposes
of this subsection (a), contributions by the policeman to the

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Fund shall not include payments made by a policeman to
establish credit under Section 5-214.2 of this Code.
(a-5) For purposes of determining the required employer
contribution to the Fund, the value of the Fund's assets shall
be equal to the actuarial value of the Fund's assets, which
shall be calculated as follows:
(1) On March 30, 2011, the actuarial value of the
Fund's assets shall be equal to the market value of the
assets as of that date.
(2) In determining the actuarial value of the Fund's
assets for fiscal years after March 30, 2011, 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.
(a-7) If the city fails to transmit to the Fund
contributions required of it under this Article for more than
90 days after the payment of those contributions is due, the
Fund may, after giving notice to the city, certify to the State
Comptroller the amounts of the delinquent payments, and the
Comptroller must, beginning in fiscal year 2016, deduct and
deposit into the Fund the certified amounts or a portion of
those amounts from the following proportions of grants of State
funds to the city:
(1) in fiscal year 2016, one-third of the total amount
of any grants of State funds to the city;
(2) in fiscal year 2017, two-thirds of the total amount

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of any grants of State funds to the city; and
(3) in fiscal year 2018 and each fiscal year
thereafter, the total amount of any grants of State funds
to the city.
The State Comptroller may not deduct from any grants of
State funds to the city more than the amount of delinquent
payments certified to the State Comptroller by the Fund.
(b) The tax shall be levied and collected in like manner
with the general taxes of the city, and is in addition to all
other taxes which the city is now or may hereafter be
authorized to levy upon all taxable property therein, and is
exclusive of and in addition to the amount of tax the city is
now or may hereafter be authorized to levy for general purposes
under any law which may limit the amount of tax which the city
may levy for general purposes. The county clerk of the county
in which the city is located, in reducing tax levies under
Section 8-3-1 of the Illinois Municipal Code, shall not
consider the tax herein authorized as a part of the general tax
levy for city purposes, and shall not include the tax in any
limitation of the percent of the assessed valuation upon which
taxes are required to be extended for the city.
(c) On or before January 10 of each year, the board shall
notify the city council of the requirement that the tax herein
authorized be levied by the city council for that current year.
The board shall compute the amounts necessary for the purposes
of this fund to be credited to the reserves established and

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maintained within the fund; shall make an annual determination
of the amount of the required city contributions; and shall
certify the results thereof to the city council.
As soon as any revenue derived from the tax is collected it
shall be paid to the city treasurer of the city and shall be
held by him for the benefit of the fund in accordance with this
Article.
(d) If the funds available are insufficient during any year
to meet the requirements of this Article, the city may issue
tax anticipation warrants against the tax levy for the current
fiscal year.
(e) The various sums, including interest, to be contributed
by the city, shall be taken from the revenue derived from such
tax or otherwise as expressly provided in this Section. Any
moneys of the city derived from any source other than the tax
herein authorized shall not be used for any purpose of the fund
nor the cost of administration thereof, unless applied to make
the deposit expressly authorized in this Section or the
additional city contributions required under subsection (h).
(f) If it is not possible or practicable for the city to
make its contributions at the time that salary deductions are
made, the city shall make such contributions as soon as
possible thereafter, with interest thereon to the time it is
made.
(g) In lieu of levying all or a portion of the tax required
under this Section in any year, the city may deposit with the

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city treasurer no later than March 1 of that year for the
benefit of the fund, to be held in accordance with this
Article, an amount that, together with the taxes levied under
this Section for that year, is not less than the amount of the
city contributions for that year as certified by the board to
the city council. The deposit may be derived from any source
legally available for that purpose, including, but not limited
to, the proceeds of city borrowings. The making of a deposit
shall satisfy fully the requirements of this Section for that
year to the extent of the amounts so deposited. Amounts
deposited under this subsection may be used by the fund for any
of the purposes for which the proceeds of the tax levied under
this Section may be used, including the payment of any amount
that is otherwise required by this Article to be paid from the
proceeds of that tax.
(h) In addition to the contributions required under the
other provisions of this Article, by November 1 of the
following specified years, the city shall deposit with the city
treasurer for the benefit of the fund, to be held and used in
accordance with this Article, the following specified amounts:
$6,300,000 in 1999; $5,880,000 in 2000; $5,460,000 in 2001;
$5,040,000 in 2002; and $4,620,000 in 2003.
The additional city contributions required under this
subsection are intended to decrease the unfunded liability of
the fund and shall not decrease the amount of the city
contributions required under the other provisions of this

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Article. The additional city contributions made under this
subsection may be used by the fund for any of its lawful
purposes.
(i) In addition to the contributions required under the
other provisions of this Article, the city shall deposit with
the city treasurer for the benefit of the fund, to be held and
used in accordance with this Article, 20% of any savings
resulting from reductions in the number of police officers
compared to the number of police officers on January 1, 2014.
(Source: P.A. 95-1036, eff. 2-17-09; 96-1495, eff. 1-1-11.)
(40 ILCS 5/6-165) (from Ch. 108 1/2, par. 6-165)
Sec. 6-165. Financing; tax.
(a) Except as expressly provided in this Section, each city
shall levy a tax annually upon all taxable property therein for
the purpose of providing revenue for the fund. For the years
prior to the year 1960, the tax rate shall be as provided for
in the "Firemen's Annuity and Benefit Fund of the Illinois
Municipal Code". The tax, from and after January 1, 1968 to and
including the year 1971, shall not exceed .0863% of the value,
as equalized or assessed by the Department of Revenue, of all
taxable property in the city. Beginning with the year 1972 and
through 2014, the city shall levy a tax annually at a rate on
the dollar of the value, as equalized or assessed by the
Department of Revenue of all taxable property within such city
that will produce, when extended, not to exceed an amount equal

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to the total amount of contributions by the employees to the
fund made in the calendar year 2 years prior to the year for
which the annual applicable tax is levied, multiplied by 2.23
through the calendar year 1981, and by 2.26 for the year 1982
and for each year through 2014. Beginning in 2015, the city
council shall levy a tax annually at a rate on the dollar of
the assessed valuation of all taxable property that will
produce when extended an annual amount that is equal to (1) the
normal cost to the Fund, plus (2) an annual amount sufficient
to bring the total assets of the Fund up to 90% of the total
actuarial liabilities of the Fund by the end of fiscal year
2040, as annually updated and determined by an enrolled actuary
employed by the Illinois Department of Insurance or by an
enrolled actuary retained by the Fund or the city. In making
these determinations, the required minimum employer
contribution shall be calculated each year as a level
percentage of payroll over the years remaining up to and
including fiscal year 2040 and shall be determined under the
projected unit credit actuarial cost method.
To provide revenue for the ordinary death benefit
established by Section 6-150 of this Article, in addition to
the contributions by the firemen for this purpose, the city
council shall for the year 1962 and each year thereafter
annually levy a tax, which shall be in addition to and
exclusive of the taxes authorized to be levied under the
foregoing provisions of this Section, upon all taxable property

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in the city, as equalized or assessed by the Department of
Revenue, at such rate per cent of the value of such property as
shall be sufficient to produce for each year the sum of
$142,000.
The amounts produced by the taxes levied annually, together
with the deposit expressly authorized in this Section, shall be
sufficient, when added to the amounts deducted from the
salaries of firemen and applied to the fund, to provide for the
purposes of the fund.
(a-5) For purposes of determining the required employer
contribution to the Fund, the value of the Fund's assets shall
be equal to the actuarial value of the Fund's assets, which
shall be calculated as follows:
(1) On March 30, 2011, the actuarial value of the
Fund's assets shall be equal to the market value of the
assets as of that date.
(2) In determining the actuarial value of the Fund's
assets for fiscal years after March 30, 2011, 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.
(a-7) If the city fails to transmit to the Fund
contributions required of it under this Article for more than
90 days after the payment of those contributions is due, the
Fund may, after giving notice to the city, certify to the State
Comptroller the amounts of the delinquent payments, and the

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Comptroller must, beginning in fiscal year 2016, deduct and
deposit into the Fund the certified amounts or a portion of
those amounts from the following proportions of grants of State
funds to the city:
(1) in fiscal year 2016, one-third of the total amount
of any grants of State funds to the city;
(2) in fiscal year 2017, two-thirds of the total amount
of any grants of State funds to the city; and
(3) in fiscal year 2018 and each fiscal year
thereafter, the total amount of any grants of State funds
to the city.
The State Comptroller may not deduct from any grants of
State funds to the city more than the amount of delinquent
payments certified to the State Comptroller by the Fund.
(b) The taxes shall be levied and collected in like manner
with the general taxes of the city, and shall be in addition to
all other taxes which the city may levy upon all taxable
property therein and shall be exclusive of and in addition to
the amount of tax the city may levy for general purposes under
Section 8-3-1 of the Illinois Municipal Code, approved May 29,
1961, as amended, or under any other law or laws which may
limit the amount of tax which the city may levy for general
purposes.
(c) The amounts of the taxes to be levied in each year
shall be certified to the city council by the board.
(d) As soon as any revenue derived from such taxes is

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collected, it shall be paid to the city treasurer and held for
the benefit of the fund, and all such revenue shall be paid
into the fund in accordance with the provisions of this
Article.
(e) If the funds available are insufficient during any year
to meet the requirements of this Article, the city may issue
tax anticipation warrants, against the tax levies herein
authorized for the current fiscal year.
(f) The various sums, hereinafter stated, including
interest, to be contributed by the city, shall be taken from
the revenue derived from the taxes or otherwise as expressly
provided in this Section. Except for defraying the cost of
administration of the fund during the calendar year in which a
city first attains a population of 500,000 and comes under the
provisions of this Article and the first calendar year
thereafter, any money of the city derived from any source other
than these taxes or the sale of tax anticipation warrants shall
not be used to provide revenue for the fund, nor to pay any
part of the cost of administration thereof, unless applied to
make the deposit expressly authorized in this Section or the
additional city contributions required under subsection (h).
(g) In lieu of levying all or a portion of the tax required
under this Section in any year, the city may deposit with the
city treasurer no later than March 1 of that year for the
benefit of the fund, to be held in accordance with this
Article, an amount that, together with the taxes levied under

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this Section for that year, is not less than the amount of the
city contributions for that year as certified by the board to
the city council. The deposit may be derived from any source
legally available for that purpose, including, but not limited
to, the proceeds of city borrowings. The making of a deposit
shall satisfy fully the requirements of this Section for that
year to the extent of the amounts so deposited. Amounts
deposited under this subsection may be used by the fund for any
of the purposes for which the proceeds of the taxes levied
under this Section may be used, including the payment of any
amount that is otherwise required by this Article to be paid
from the proceeds of those taxes.
(h) In addition to the contributions required under the
other provisions of this Article, by November 1 of the
following specified years, the city shall deposit with the city
treasurer for the benefit of the fund, to be held and used in
accordance with this Article, the following specified amounts:
$6,300,000 in 1999; $5,880,000 in 2000; $5,460,000 in 2001;
$5,040,000 in 2002; and $4,620,000 in 2003.
The additional city contributions required under this
subsection are intended to decrease the unfunded liability of
the fund and shall not decrease the amount of the city
contributions required under the other provisions of this
Article. The additional city contributions made under this
subsection may be used by the fund for any of its lawful
purposes.

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(i) In addition to the contributions required under the
other provisions of this Article, the city shall deposit with
the city treasurer for the benefit of the fund, to be held and
used in accordance with this Article, 20% of any savings
resulting from reductions in the number of firemen compared to
the number of firemen on January 1, 2014.
(Source: P.A. 96-1495, eff. 1-1-11.)
(40 ILCS 5/17-129) (from Ch. 108 1/2, par. 17-129)
Sec. 17-129. Employer contributions; 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

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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.
(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) 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.
(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 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

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payrolls over the years 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, 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) 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) 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
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 Board of Education the amount of the required
Board of Education contribution for the coming fiscal year. The

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certification shall include a copy of the actuarial
recommendations upon which it is based.
(d) In addition to the contributions required under the
other provisions of this Article, the city shall deposit with
the city treasurer for the benefit of the fund, to be held and
used in accordance with this Article, 20% of any savings
resulting from reductions in the number of teachers compared to
the number of teachers on January 1, 2014.
(Source: P.A. 96-889, eff. 4-14-10.)
Section 90. The State Mandates Act is amended by adding
Section 8.38 as follows:
(30 ILCS 805/8.38 new)
Sec. 8.38. 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 98th General Assembly.
Section 99. Effective date. This Act takes effect upon
becoming law.".