PEN CD-TRS-SALARY INCREASES

Illinois General Assembly - Full Text of HB2564

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HB2564 - 104th General Assembly

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Senate Amendment 001

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HB2564 Enrolled
LRB104 05520 RPS 15549 b
1

AN ACT concerning 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 Section 16-158 as follows:

6

(40 ILCS 5/16-158)

(from Ch. 108 1/2, par. 16-158)
7

Sec. 16-158.
Contributions by State and other employing
8
units.
9

(a) The State shall make contributions to the System by
10
means of appropriations from the Common School Fund and other
11
State funds of amounts which, together with other employer
12
contributions, employee contributions, investment income, and
13
other income, will be sufficient to meet the cost of
14
maintaining and administering the System on a 90% funded basis
15
in accordance with actuarial recommendations.
16

The Board shall determine the amount of State
17
contributions required for each fiscal year on the basis of
18
the actuarial tables and other assumptions adopted by the
19
Board and the recommendations of the actuary, using the
20
formula in subsection (b-3).
21

(a-1) Annually, on or before November 15 until November
22
15, 2011, the Board shall certify to the Governor the amount of
23
the required State contribution for the coming fiscal year.

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1
The certification under this subsection (a-1) shall include a
2
copy of the actuarial recommendations upon which it is based
3
and shall specifically identify the System's projected State
4
normal cost for that fiscal year.
5

On or before May 1, 2004, the Board shall recalculate and
6
recertify to the Governor the amount of the required State
7
contribution to the System for State fiscal year 2005, taking
8
into account the amounts appropriated to and received by the
9
System under subsection (d) of Section 7.2 of the General
10
Obligation Bond Act.
11

On or before July 1, 2005, the Board shall recalculate and
12
recertify to the Governor the amount of the required State
13
contribution to the System for State fiscal year 2006, taking
14
into account the changes in required State contributions made
15
by Public Act 94-4.
16

On or before April 1, 2011, the Board shall recalculate
17
and recertify to the Governor the amount of the required State
18
contribution to the System for State fiscal year 2011,
19
applying the changes made by Public Act 96-889 to the System's
20
assets and liabilities as of June 30, 2009 as though Public Act
21
96-889 was approved on that date.
22

(a-5) On or before November 1 of each year, beginning
23
November 1, 2012, the Board shall submit to the State Actuary,
24
the Governor, and the General Assembly a proposed
25
certification of the amount of the required State contribution
26
to the System for the next fiscal year, along with all of the

HB2564 Enrolled
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LRB104 05520 RPS 15549 b
1
actuarial assumptions, calculations, and data upon which that
2
proposed certification is based. On or before January 1 of
3
each year, beginning January 1, 2013, the State Actuary shall
4
issue a preliminary report concerning the proposed
5
certification and identifying, if necessary, recommended
6
changes in actuarial assumptions that the Board must consider
7
before finalizing its certification of the required State
8
contributions. On or before January 15, 2013 and each January
9
15 thereafter, the Board shall certify to the Governor and the
10
General Assembly the amount of the required State contribution
11
for the next fiscal year. The Board's certification must note
12
any deviations from the State Actuary's recommended changes,
13
the reason or reasons for not following the State Actuary's
14
recommended changes, and the fiscal impact of not following
15
the State Actuary's recommended changes on the required State
16
contribution.
17

(a-10) By November 1, 2017, the Board shall recalculate
18
and recertify to the State Actuary, the Governor, and the
19
General Assembly the amount of the State contribution to the
20
System for State fiscal year 2018, taking into account the
21
changes in required State contributions made by Public Act
22
100-23. The State Actuary shall review the assumptions and
23
valuations underlying the Board's revised certification and
24
issue a preliminary report concerning the proposed
25
recertification and identifying, if necessary, recommended
26
changes in actuarial assumptions that the Board must consider

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LRB104 05520 RPS 15549 b
1
before finalizing its certification of the required State
2
contributions. The Board's final certification must note any
3
deviations from the State Actuary's recommended changes, the
4
reason or reasons for not following the State Actuary's
5
recommended changes, and the fiscal impact of not following
6
the State Actuary's recommended changes on the required State
7
contribution.
8

(a-15) On or after June 15, 2019, but no later than June
9
30, 2019, the Board shall recalculate and recertify to the
10
Governor and the General Assembly the amount of the State
11
contribution to the System for State fiscal year 2019, taking
12
into account the changes in required State contributions made
13
by Public Act 100-587. The recalculation shall be made using
14
assumptions adopted by the Board for the original fiscal year
15
2019 certification. The monthly voucher for the 12th month of
16
fiscal year 2019 shall be paid by the Comptroller after the
17
recertification required pursuant to this subsection is
18
submitted to the Governor, Comptroller, and General Assembly.
19
The recertification submitted to the General Assembly shall be
20
filed with the Clerk of the House of Representatives and the
21
Secretary of the Senate in electronic form only, in the manner
22
that the Clerk and the Secretary shall direct.
23

(b) Through State fiscal year 1995, the State
24
contributions shall be paid to the System in accordance with
25
Section 18-7 of the School Code.
26

(b-1) Unless otherwise directed by the Comptroller under

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LRB104 05520 RPS 15549 b
1
subsection (b-1.1), the Board shall submit vouchers for
2
payment of State contributions to the System for the
3
applicable month on the 15th day of each month, or as soon
4
thereafter as may be practicable. The amount vouchered for a
5
monthly payment shall total one-twelfth of the required annual
6
State contribution certified under subsection (a-1).
7

(b-1.1) Beginning in State fiscal year 2025, if the
8
Comptroller requests that the Board submit, during a State
9
fiscal year, vouchers for multiple monthly payments for the
10
advance payment of State contributions due to the System for
11
that State fiscal year, then the Board shall submit those
12
additional vouchers as directed by the Comptroller,
13
notwithstanding subsection (b-1). Unless an act of
14
appropriations provides otherwise, nothing in this Section
15
authorizes the Board to submit, in a State fiscal year,
16
vouchers for the payment of State contributions to the System
17
in an amount that exceeds the rate of payroll that is certified
18
by the System under this Section for that State fiscal year.
19

(b-1.2) The vouchers described in subsections (b-1) and
20
(b-1.1) shall be paid by the State Comptroller and Treasurer
21
by warrants drawn on the funds appropriated to the System for
22
that fiscal year.
23

If in any month the amount remaining unexpended from all
24
other appropriations to the System for the applicable fiscal
25
year (including the appropriations to the System under Section
26
8.12 of the State Finance Act and Section 1 of the State

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LRB104 05520 RPS 15549 b
1
Pension Funds Continuing Appropriation Act) is less than the
2
amount lawfully vouchered under this subsection, the
3
difference shall be paid from the Common School Fund under the
4
continuing appropriation authority provided in Section 1.1 of
5
the State Pension Funds Continuing Appropriation Act.
6

(b-2) Allocations from the Common School Fund apportioned
7
to school districts not coming under this System shall not be
8
diminished or affected by the provisions of this Article.
9

(b-3) For State fiscal years 2012 through 2045, the
10
minimum contribution to the System to be made by the State for
11
each fiscal year shall be an amount determined by the System to
12
be sufficient to bring the total assets of the System up to 90%
13
of the total actuarial liabilities of the System by the end of
14
State fiscal year 2045. In making these determinations, the
15
required State contribution shall be calculated each year as a
16
level percentage of payroll over the years remaining to and
17
including fiscal year 2045 and shall be determined under the
18
projected unit credit actuarial cost method.
19

For each of State fiscal years 2018, 2019, and 2020, the
20
State shall make an additional contribution to the System
21
equal to 2% of the total payroll of each employee who is deemed
22
to have elected the benefits under Section 1-161 or who has
23
made the election under subsection (c) of Section 1-161.
24

A change in an actuarial or investment assumption that
25
increases or decreases the required State contribution and
26
first applies in State fiscal year 2018 or thereafter shall be

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LRB104 05520 RPS 15549 b
1
implemented in equal annual amounts over a 5-year period
2
beginning in the State fiscal year in which the actuarial
3
change first applies to the required State contribution.
4

A change in an actuarial or investment assumption that
5
increases or decreases the required State contribution and
6
first applied to the State contribution in fiscal year 2014,
7
2015, 2016, or 2017 shall be implemented:
8

(i) as already applied in State fiscal years before
9

2018; and
10

(ii) in the portion of the 5-year period beginning in
11

the State fiscal year in which the actuarial change first
12

applied that occurs in State fiscal year 2018 or
13

thereafter, by calculating the change in equal annual
14

amounts over that 5-year period and then implementing it
15

at the resulting annual rate in each of the remaining
16

fiscal years in that 5-year period.
17

For State fiscal years 1996 through 2005, the State
18
contribution to the System, as a percentage of the applicable
19
employee payroll, shall be increased in equal annual
20
increments so that by State fiscal year 2011, the State is
21
contributing at the rate required under this Section; except
22
that in the following specified State fiscal years, the State
23
contribution to the System shall not be less than the
24
following indicated percentages of the applicable employee
25
payroll, even if the indicated percentage will produce a State
26
contribution in excess of the amount otherwise required under

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LRB104 05520 RPS 15549 b
1
this subsection and subsection (a), and notwithstanding any
2
contrary certification made under subsection (a-1) before May
3
27, 1998 (the effective date of Public Act 90-582): 10.02% in
4
FY 1999; 10.77% in FY 2000; 11.47% in FY 2001; 12.16% in FY
5
2002; 12.86% in FY 2003; and 13.56% in FY 2004.
6

Notwithstanding any other provision of this Article, the
7
total required State contribution for State fiscal year 2006
8
is $534,627,700.
9

Notwithstanding any other provision of this Article, the
10
total required State contribution for State fiscal year 2007
11
is $738,014,500.
12

For each of State fiscal years 2008 through 2009, the
13
State contribution to the System, as a percentage of the
14
applicable employee payroll, shall be increased in equal
15
annual increments from the required State contribution for
16
State fiscal year 2007, so that by State fiscal year 2011, the
17
State is contributing at the rate otherwise required under
18
this Section.
19

Notwithstanding any other provision of this Article, the
20
total required State contribution for State fiscal year 2010
21
is $2,089,268,000 and shall be made from the proceeds of bonds
22
sold in fiscal year 2010 pursuant to Section 7.2 of the General
23
Obligation Bond Act, less (i) the pro rata share of bond sale
24
expenses determined by the System's share of total bond
25
proceeds, (ii) any amounts received from the Common School
26
Fund in fiscal year 2010, and (iii) any reduction in bond

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LRB104 05520 RPS 15549 b
1
proceeds due to the issuance of discounted bonds, if
2
applicable.
3

Notwithstanding any other provision of this Article, the
4
total required State contribution for State fiscal year 2011
5
is the amount recertified by the System on or before April 1,
6
2011 pursuant to subsection (a-1) of this Section and shall be
7
made from the proceeds of bonds sold in fiscal year 2011
8
pursuant to Section 7.2 of the General Obligation Bond Act,
9
less (i) the pro rata share of bond sale expenses determined by
10
the System's share of total bond proceeds, (ii) any amounts
11
received from the Common School Fund in fiscal year 2011, and
12
(iii) any reduction in bond proceeds due to the issuance of
13
discounted bonds, if applicable. This amount shall include, in
14
addition to the amount certified by the System, an amount
15
necessary to meet employer contributions required by the State
16
as an employer under paragraph (e) of this Section, which may
17
also be used by the System for contributions required by
18
paragraph (a) of Section 16-127.
19

Beginning in State fiscal year 2046, the minimum State
20
contribution for each fiscal year shall be the amount needed
21
to maintain the total assets of the System at 90% of the total
22
actuarial liabilities of the System.
23

Amounts received by the System pursuant to Section 25 of
24
the Budget Stabilization Act or Section 8.12 of the State
25
Finance Act in any fiscal year do not reduce and do not
26
constitute payment of any portion of the minimum State

HB2564 Enrolled
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LRB104 05520 RPS 15549 b
1
contribution required under this Article in that fiscal year.
2
Such amounts shall not reduce, and shall not be included in the
3
calculation of, the required State contributions under this
4
Article in any future year until the System has reached a
5
funding ratio of at least 90%. A reference in this Article to
6
the "required State contribution" or any substantially similar
7
term does not include or apply to any amounts payable to the
8
System under Section 25 of the Budget Stabilization Act.
9

Notwithstanding any other provision of this Section, the
10
required State contribution for State fiscal year 2005 and for
11
fiscal year 2008 and each fiscal year thereafter, as
12
calculated under this Section and certified under subsection
13
(a-1), shall not exceed an amount equal to (i) the amount of
14
the required State contribution that would have been
15
calculated under this Section for that fiscal year if the
16
System had not received any payments under subsection (d) of
17
Section 7.2 of the General Obligation Bond Act, minus (ii) the
18
portion of the State's total debt service payments for that
19
fiscal year on the bonds issued in fiscal year 2003 for the
20
purposes of that Section 7.2, as determined and certified by
21
the Comptroller, that is the same as the System's portion of
22
the total moneys distributed under subsection (d) of Section
23
7.2 of the General Obligation Bond Act. In determining this
24
maximum for State fiscal years 2008 through 2010, however, the
25
amount referred to in item (i) shall be increased, as a
26
percentage of the applicable employee payroll, in equal

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LRB104 05520 RPS 15549 b
1
increments calculated from the sum of the required State
2
contribution for State fiscal year 2007 plus the applicable
3
portion of the State's total debt service payments for fiscal
4
year 2007 on the bonds issued in fiscal year 2003 for the
5
purposes of Section 7.2 of the General Obligation Bond Act, so
6
that, by State fiscal year 2011, the State is contributing at
7
the rate otherwise required under this Section.
8

(b-4) Beginning in fiscal year 2018, each employer under
9
this Article shall pay to the System a required contribution
10
determined as a percentage of projected payroll and sufficient
11
to produce an annual amount equal to:
12

(i) for each of fiscal years 2018, 2019, and 2020, the
13

defined benefit normal cost of the defined benefit plan,
14

less the employee contribution, for each employee of that
15

employer who has elected or who is deemed to have elected
16

the benefits under Section 1-161 or who has made the
17

election under subsection (b) of Section 1-161; for fiscal
18

year 2021 and each fiscal year thereafter, the defined
19

benefit normal cost of the defined benefit plan, less the
20

employee contribution, plus 2%, for each employee of that
21

employer who has elected or who is deemed to have elected
22

the benefits under Section 1-161 or who has made the
23

election under subsection (b) of Section 1-161; plus
24

(ii) the amount required for that fiscal year to
25

amortize any unfunded actuarial accrued liability
26

associated with the present value of liabilities

HB2564 Enrolled
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LRB104 05520 RPS 15549 b
1

attributable to the employer's account under Section
2

16-158.3, determined as a level percentage of payroll over
3

a 30-year rolling amortization period.
4

In determining contributions required under item (i) of
5
this subsection, the System shall determine an aggregate rate
6
for all employers, expressed as a percentage of projected
7
payroll.
8

In determining the contributions required under item (ii)
9
of this subsection, the amount shall be computed by the System
10
on the basis of the actuarial assumptions and tables used in
11
the most recent actuarial valuation of the System that is
12
available at the time of the computation.
13

The contributions required under this subsection (b-4)
14
shall be paid by an employer concurrently with that employer's
15
payroll payment period. The State, as the actual employer of
16
an employee, shall make the required contributions under this
17
subsection.
18

(c) Payment of the required State contributions and of all
19
pensions, retirement annuities, death benefits, refunds, and
20
other benefits granted under or assumed by this System, and
21
all expenses in connection with the administration and
22
operation thereof, are obligations of the State.
23

If members are paid from special trust or federal funds
24
which are administered by the employing unit, whether school
25
district or other unit, the employing unit shall pay to the
26
System from such funds the full accruing retirement costs

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LRB104 05520 RPS 15549 b
1
based upon that service, which, beginning July 1, 2017, shall
2
be at a rate, expressed as a percentage of salary, equal to the
3
total employer's normal cost, expressed as a percentage of
4
payroll, as determined by the System. Employer contributions,
5
based on salary paid to members from federal funds, may be
6
forwarded by the distributing agency of the State of Illinois
7
to the System prior to allocation, in an amount determined in
8
accordance with guidelines established by such agency and the
9
System. Any contribution for fiscal year 2015 collected as a
10
result of the change made by Public Act 98-674 shall be
11
considered a State contribution under subsection (b-3) of this
12
Section.
13

(d) Effective July 1, 1986, any employer of a teacher as
14
defined in paragraph (8) of Section 16-106 shall pay the
15
employer's normal cost of benefits based upon the teacher's
16
service, in addition to employee contributions, as determined
17
by the System. Such employer contributions shall be forwarded
18
monthly in accordance with guidelines established by the
19
System.
20

However, with respect to benefits granted under Section
21
16-133.4 or 16-133.5 to a teacher as defined in paragraph (8)
22
of Section 16-106, the employer's contribution shall be 12%
23
(rather than 20%) of the member's highest annual salary rate
24
for each year of creditable service granted, and the employer
25
shall also pay the required employee contribution on behalf of
26
the teacher. For the purposes of Sections 16-133.4 and

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LRB104 05520 RPS 15549 b
1
16-133.5, a teacher as defined in paragraph (8) of Section
2
16-106 who is serving in that capacity while on leave of
3
absence from another employer under this Article shall not be
4
considered an employee of the employer from which the teacher
5
is on leave.
6

(e) Beginning July 1, 1998, every employer of a teacher
7
shall pay to the System an employer contribution computed as
8
follows:
9

(1) Beginning July 1, 1998 through June 30, 1999, the
10

employer contribution shall be equal to 0.3% of each
11

teacher's salary.
12

(2) Beginning July 1, 1999 and thereafter, the
13

employer contribution shall be equal to 0.58% of each
14

teacher's salary.
15
The school district or other employing unit may pay these
16
employer contributions out of any source of funding available
17
for that purpose and shall forward the contributions to the
18
System on the schedule established for the payment of member
19
contributions.
20

These employer contributions are intended to offset a
21
portion of the cost to the System of the increases in
22
retirement benefits resulting from Public Act 90-582.
23

Each employer of teachers is entitled to a credit against
24
the contributions required under this subsection (e) with
25
respect to salaries paid to teachers for the period January 1,
26
2002 through June 30, 2003, equal to the amount paid by that

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LRB104 05520 RPS 15549 b
1
employer under subsection (a-5) of Section 6.6 of the State
2
Employees Group Insurance Act of 1971 with respect to salaries
3
paid to teachers for that period.
4

The additional 1% employee contribution required under
5
Section 16-152 by Public Act 90-582 is the responsibility of
6
the teacher and not the teacher's employer, unless the
7
employer agrees, through collective bargaining or otherwise,
8
to make the contribution on behalf of the teacher.
9

If an employer is required by a contract in effect on May
10
1, 1998 between the employer and an employee organization to
11
pay, on behalf of all its full-time employees covered by this
12
Article, all mandatory employee contributions required under
13
this Article, then the employer shall be excused from paying
14
the employer contribution required under this subsection (e)
15
for the balance of the term of that contract. The employer and
16
the employee organization shall jointly certify to the System
17
the existence of the contractual requirement, in such form as
18
the System may prescribe. This exclusion shall cease upon the
19
termination, extension, or renewal of the contract at any time
20
after May 1, 1998.
21

(f) If the amount of a teacher's salary for any school year
22
used to determine final average salary exceeds the member's
23
annual full-time salary rate with the same employer for the
24
previous school year by more than 6%, the teacher's employer
25
shall pay to the System, in addition to all other payments
26
required under this Section and in accordance with guidelines

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1
established by the System, the present value of the increase
2
in benefits resulting from the portion of the increase in
3
salary that is in excess of 6%. This present value shall be
4
computed by the System on the basis of the actuarial
5
assumptions and tables used in the most recent actuarial
6
valuation of the System that is available at the time of the
7
computation. If a teacher's salary for the 2005-2006 school
8
year is used to determine final average salary under this
9
subsection (f), then the changes made to this subsection (f)
10
by Public Act 94-1057 shall apply in calculating whether the
11
increase in his or her salary is in excess of 6%. For the
12
purposes of this Section, change in employment under Section
13
10-21.12 of the School Code on or after June 1, 2005 shall
14
constitute a change in employer. The System may require the
15
employer to provide any pertinent information or
16
documentation. The changes made to this subsection (f) by
17
Public Act 94-1111 apply without regard to whether the teacher
18
was in service on or after its effective date.
19

Whenever it determines that a payment is or may be
20
required under this subsection, the System shall calculate the
21
amount of the payment and bill the employer for that amount.
22
The bill shall specify the calculations used to determine the
23
amount due. If the employer disputes the amount of the bill, it
24
may, within 30 days after receipt of the bill, apply to the
25
System in writing for a recalculation. The application must
26
specify in detail the grounds of the dispute and, if the

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1
employer asserts that the calculation is subject to subsection
2
(g), (g-5), (g-10), (g-15), (g-20),
(g-25),
or (h) of this
3
Section, must include an affidavit setting forth and attesting
4
to all facts within the employer's knowledge that are
5
pertinent to the applicability of that subsection. Upon
6
receiving a timely application for recalculation, the System
7
shall review the application and, if appropriate, recalculate
8
the amount due.
9

The employer contributions required under this subsection
10
(f) may be paid in the form of a lump sum within 90 days after
11
receipt of the bill. If the employer contributions are not
12
paid within 90 days after receipt of the bill, then interest
13
will be charged at a rate equal to the System's annual
14
actuarially assumed rate of return on investment compounded
15
annually from the 91st day after receipt of the bill. Payments
16
must be concluded within 7 years after the employer's receipt
17
of the bill.
18

(f-1) (Blank).
19

(g) This subsection (g) applies only to payments made or
20
salary increases given on or after June 1, 2005 but before July
21
1, 2011. The changes made by Public Act 94-1057 shall not
22
require the System to refund any payments received before July
23
31, 2006 (the effective date of Public Act 94-1057).
24

When assessing payment for any amount due under subsection
25
(f), the System shall exclude salary increases paid to
26
teachers under contracts or collective bargaining agreements

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1
entered into, amended, or renewed before June 1, 2005.
2

When assessing payment for any amount due under subsection
3
(f), the System shall exclude salary increases paid to a
4
teacher at a time when the teacher is 10 or more years from
5
retirement eligibility under Section 16-132 or 16-133.2.
6

When assessing payment for any amount due under subsection
7
(f), the System shall exclude salary increases resulting from
8
overload work, including summer school, when the school
9
district has certified to the System, and the System has
10
approved the certification, that (i) the overload work is for
11
the sole purpose of classroom instruction in excess of the
12
standard number of classes for a full-time teacher in a school
13
district during a school year and (ii) the salary increases
14
are equal to or less than the rate of pay for classroom
15
instruction computed on the teacher's current salary and work
16
schedule.
17

When assessing payment for any amount due under subsection
18
(f), the System shall exclude a salary increase resulting from
19
a promotion (i) for which the employee is required to hold a
20
certificate or supervisory endorsement issued by the State
21
Teacher Certification Board that is a different certification
22
or supervisory endorsement than is required for the teacher's
23
previous position and (ii) to a position that has existed and
24
been filled by a member for no less than one complete academic
25
year and the salary increase from the promotion is an increase
26
that results in an amount no greater than the lesser of the

HB2564 Enrolled
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LRB104 05520 RPS 15549 b
1
average salary paid for other similar positions in the
2
district requiring the same certification or the amount
3
stipulated in the collective bargaining agreement for a
4
similar position requiring the same certification.
5

When assessing payment for any amount due under subsection
6
(f), the System shall exclude any payment to the teacher from
7
the State of Illinois or the State Board of Education over
8
which the employer does not have discretion, notwithstanding
9
that the payment is included in the computation of final
10
average salary.
11

(g-5) When assessing payment for any amount due under
12
subsection (f), the System shall exclude salary increases
13
resulting from overload or stipend work performed in a school
14
year subsequent to a school year in which the employer was
15
unable to offer or allow to be conducted overload or stipend
16
work due to an emergency declaration limiting such activities.
17

(g-10) When assessing payment for any amount due under
18
subsection (f), the System shall exclude salary increases
19
resulting from increased instructional time that exceeded the
20
instructional time required during the 2019-2020 school year.
21

(g-15) When assessing payment for any amount due under
22
subsection (f), the System shall exclude salary increases
23
resulting from teaching summer school on or after May 1, 2021
24
and before September 15, 2022.
25

(g-20) When assessing payment for any amount due under
26
subsection (f), the System shall exclude salary increases

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1
necessary to bring a school board in compliance with Public
2
Act 101-443 or this amendatory Act of the 103rd General
3
Assembly.
4

(g-25) When assessing payment for any amount due under
5
subsection (f), the System shall exclude salary increases
6
given on or after the effective date of this amendatory Act of
7
the 104th General Assembly resulting from overload work,
8
summer school work, or stipend work, when the school district
9
has certified to the System, and the System has approved the
10
certification, that the overload work, summer school work, or
11
the stipend work is for the sole purpose of classroom
12
instruction in excess of the standard number of classes for a
13
full-time teacher in a school district during a school year.

14

(h) When assessing payment for any amount due under
15
subsection (f), the System shall exclude any salary increase
16
described in subsection (g) of this Section given on or after
17
July 1, 2011 but before July 1, 2014 under a contract or
18
collective bargaining agreement entered into, amended, or
19
renewed on or after June 1, 2005 but before July 1, 2011.
20
Notwithstanding any other provision of this Section, any
21
payments made or salary increases given after June 30, 2014
22
shall be used in assessing payment for any amount due under
23
subsection (f) of this Section.
24

(i) The System shall prepare a report and file copies of
25
the report with the Governor and the General Assembly by
26
January 1, 2007 that contains all of the following

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1
information:
2

(1) The number of recalculations required by the
3

changes made to this Section by Public Act 94-1057 for
4

each employer.
5

(2) The dollar amount by which each employer's
6

contribution to the System was changed due to
7

recalculations required by Public Act 94-1057.
8

(3) The total amount the System received from each
9

employer as a result of the changes made to this Section by
10

Public Act 94-4.
11

(4) The increase in the required State contribution
12

resulting from the changes made to this Section by Public
13

Act 94-1057.
14

(i-5) For school years beginning on or after July 1, 2017,
15
if the amount of a participant's salary for any school year
16
exceeds the amount of the salary set for the Governor, the
17
participant's employer shall pay to the System, in addition to
18
all other payments required under this Section and in
19
accordance with guidelines established by the System, an
20
amount determined by the System to be equal to the employer
21
normal cost, as established by the System and expressed as a
22
total percentage of payroll, multiplied by the amount of
23
salary in excess of the amount of the salary set for the
24
Governor. This amount shall be computed by the System on the
25
basis of the actuarial assumptions and tables used in the most
26
recent actuarial valuation of the System that is available at

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1
the time of the computation. The System may require the
2
employer to provide any pertinent information or
3
documentation.
4

Whenever it determines that a payment is or may be
5
required under this subsection, the System shall calculate the
6
amount of the payment and bill the employer for that amount.
7
The bill shall specify the calculations used to determine the
8
amount due. If the employer disputes the amount of the bill, it
9
may, within 30 days after receipt of the bill, apply to the
10
System in writing for a recalculation. The application must
11
specify in detail the grounds of the dispute. Upon receiving a
12
timely application for recalculation, the System shall review
13
the application and, if appropriate, recalculate the amount
14
due.
15

The employer contributions required under this subsection
16
may be paid in the form of a lump sum within 90 days after
17
receipt of the bill. If the employer contributions are not
18
paid within 90 days after receipt of the bill, then interest
19
will be charged at a rate equal to the System's annual
20
actuarially assumed rate of return on investment compounded
21
annually from the 91st day after receipt of the bill. Payments
22
must be concluded within 3 years after the employer's receipt
23
of the bill.
24

(j) For purposes of determining the required State
25
contribution to the System, the value of the System's assets
26
shall be equal to the actuarial value of the System's assets,

HB2564 Enrolled
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1
which shall be calculated as follows:
2

As of June 30, 2008, the actuarial value of the System's
3
assets shall be equal to the market value of the assets as of
4
that date. In determining the actuarial value of the System's
5
assets for fiscal years after June 30, 2008, any actuarial
6
gains or losses from investment return incurred in a fiscal
7
year shall be recognized in equal annual amounts over the
8
5-year period following that fiscal year.
9

(k) For purposes of determining the required State
10
contribution to the system for a particular year, the
11
actuarial value of assets shall be assumed to earn a rate of
12
return equal to the system's actuarially assumed rate of
13
return.
14
(Source: P.A. 103-515, eff. 8-11-23; 103-588, eff. 6-5-24;
15
104-284, eff. 1-1-26
.)

16

Section 99.
Effective date.
This Act takes effect upon
17
becoming law.

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|
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