Legislation 99th General Assembly (2015-2016)

House

HB 0422
- Actuarial Experience Study Every Three Years
Sponsor(s): Representative Thomas Morrison and Senator Michael Connelly

   Became Public Act 99-0232 on 8/3/2015

HB 422 requires the actuarial experience study to occur at least once every three years (instead of at least once every five years) for the General Assembly Retirement System, State Employees Retirement System, State Universities Retirement System, Teachers Retirement System, and Judges Retirement System.

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HB 3484
- State Retirement Systems Administrative Technical Changes
Sponsor(s): Representative Elaine Nekritz and Senator Daniel Biss

   Became Public Act 99-0450 on 8/24/2015

HB 3484 makes the following technical changes to strengthen the oversight and administration of the State Universities Retirement System ("SURS"):

  • Clarifies that the final rate of earnings formula for a person with more than 36 months of prior service applies to individuals with service credit before September 1, 1941;

  • Codifies a definition of "plan year," which is referenced in statute but never defined;

  • Clarifies that interest calculated on a refund to reestablish service credit begins on the date the refund was issued by SURS (instead of the date received by the member); and

  • Clarifies that both active and inactive participants may purchase optional service credit, but only active participants can purchase optional service credit through pre-tax paycheck deductions.  

HB 3484 makes technical changes for three of the other State-funded retirement systems (General Assembly Retirement System, State Employees Retirement System, and Teachers Retirement System).

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HB 4259
- SURS Participation Limited to Public Employees
Sponsor(s): Representative Martin J. Moylan and Senator John J. Cullerton

   Became Public Act 99-0830 on 8/19/2016

HB 4259 excludes individuals who begin employment with the following employers on or after the effective date from participation under SURS: certain associations of community college boards, the Association of Illinois Middle-Grade Schools, the Illinois Association of School Administrators, the Illinois Association for Supervision and Curriculum Development, the Illinois Principals Association, the Illinois Association of School Business Officials, the Illinois Special Olympics, and any entity not defined as an employer.

HB 4259 also gives the SURS Board of Trustees final determination as to whether a person is an employee covered under SURS.

HB 4259 makes similar changes to the Illinois Municipal Retirement Fund and the Teachers Retirement System.

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HB 6021
- Election to Restore Survivors Insurance Benefits
Sponsor(s): Representative Sam Yingling and Senator Daniel Biss

   Became Public Act 99-0682 on 7/29/2016

HB 6021 allows eligible SURS retirees to restore their survivors insurance benefits by making a one-time, irrevocable election to repay their survivors refund or additional annuity, along with interest compounded at the actuarially assumed rate of return (7.25%), to SURS.   The compounded interest applies from the date of issuance of the refund to the SURS retiree, or the date of issuance of each additional annuity payment to the SURS retiree, until the date of repayment to SURS.  Full repayment must be made to SURS by the earlier of: 24 months after the date of the election, or the date of the retiree’s death.  Eligible retirees have one year, beginning five months after the effective date of the legislation, to irrevocably elect to restore their survivors insurance

Under HB 6021, an eligible SURS retiree must meet the following requirements:

  • He or she retired before June 1, 2011 and received a refund or additional annuity equal to the amount of his or her survivors insurance contributions; and

  • He or she is a party to a: (1) civil union or legal relationship that is recognized as a civil union or marriage on or after June 1, 2011; (2) marriage on or after February 26, 2014; or (3) marriage, civil union, or other legal relationship that was not recognized in Illinois as a civil union or marriage until June 1, 2011, a marriage until February 26, 2014, or both.

HB 6021 makes similar changes to the Illinois Municipal Retirement Fund and Teachers Retirement System.

HB 6021 is very similar to House Bill 2520 of the 99th General Assembly, as introduced.

 

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HB 6030
- Deceased Annuitant Identification Process
Sponsor(s): Representative Deb Conroy and Senator Thomas Cullerton

   Became Public Act 99-0683 on 7/29/2016

HB 6030 requires each pension fund and retirement system under the Illinois Pension Code, except for downstate police and firefighters pension funds, to develop and implement, by June 30, 2017, a process to identify deceased annuitants.  

Specifically, HB 6030 requires the pension fund or retirement system to check for deceased annuitants at least once per month and to use common methods to identify deceased persons, including:

  • The use of a third party entity that specializes in identifying deceased persons;

  • The use of data provided by the Social Security Administration;

  • The use of data provided by the Illinois Department of Public Health’s Office of Vital Records; or

  • The use of any other method commonly used by other states to identify deceased persons.

HB 6030 also amends the Vital Records Act to require any information contained in the State vital records to be made available, at no cost, to any pension fund or retirement system under the Illinois Pension Code for administrative purposes.

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HJR 137
- SURS 75th Anniversary
Sponsor(s): Representative Carol Ammons

HJR 137 congratulates the State Universities Retirement System on its 75th Anniversary.

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HR 0146
- Urge Federal Repeal of the Government Pension Offset and Windfall Elimination Provision
Sponsor(s): Representative Mary E. Flowers

HR 146 urges the United States Congress to introduce and pass legislation repealing the Government Pension Offset and the Windfall Elimination Provision.  These federal laws reduce the Social Security benefits of certain public sector retirees and their survivors.

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HR 0531
- Fee Reductions for Reductions in State Aid to Municipalities
Sponsor(s): Representative Chris Welch

HR 531 urges members of the General Assembly not to implement any cuts to State aid to municipalities unless those cuts are matched by equally proportionate reductions in fees for financial services paid by State agencies, including fees for all financial services, including cash management, investment management, and debt management.

Additionally, HR 531 urges that, if the General Assembly cuts State aid to municipalities, all State agencies request that the firms that provide financial services to them reduce fees by an equally proportionate amount.

Lastly, HR 531 urges State agencies not to make any payments to firms that refuse to reduce fees for financial services by the set amount until they have first met all of their other financial obligations, including fully funding public services and State aid to municipalities, paying workers, making pension fund contributions, and paying other legitimate bills.

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HR 1100
- SURS 75th Anniversary
Sponsor(s): Representative Carol Ammons

HR 1100 congratulates the State Universities Retirement System on its 75th Anniversary.

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Appropriations

SB 0842
- Fiscal Year 2016 Budget Implementation
Sponsor(s): Senator John J. Cullerton and Representative Barbara Flynn Currie

   Became Public Act 99-0008 on 7/9/2015

SB 842 contains budget implementation language authorizing the appropriation of $190,000,000 from the State Pensions Fund to the State Universities Retirement System as part of the annual required State contribution for Fiscal Year 2016. SB 842 also makes other changes.

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SB 1810
- FY 2017 Stopgap Budget Implementation Act
Sponsor(s): Senator Donne E. Trotter

   Became Public Act 99-0523 pm 6/30/2015

SB 1810 creates the FY2017 Stopgap Budget Implementation Act.  SB 1810 contains budget implementation language authorizing use of money in the State Pensions Fund as part of the annual required State contribution to SURS for Fiscal Year 2017.  SB 1810 also makes other changes.

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SB 2047
- FY 2016 and FY 2017 Stopgap Budget
Sponsor(s): Senator Donne E. Trotter and Representative Barbara Flynn Currie

   Became Public Act 99-0524 on 6/30/2015

As it relates to SURS, SB 2047 appropriates $190 million from the State Pensions Fund as part of the annual required State contribution to SURS for FY 2016 and appropriates $190 million from the State Pensions Fund as part of the annual required State contribution to SURS for FY 2017.  SB 2047 also makes other appropriations.

In Fiscal Year 2016, SURS received $190 million from the State Pensions Fund and submitted vouchers for payment of the remaining $1,411,480,000 of the annual required State contribution from the General Revenue Fund under the State Pension Funds Continuing Appropriation Act.  Additionally, $4,624,625 was transferred from the General Revenue Fund to the Community College Health Insurance Security Fund under the State Pension Funds Continuing Appropriation Act for the State contribution to the College Insurance Program (“CIP”) for FY 2016.  

Under current law, the State Pension Funds Continuing Appropriation Act gives SURS the ability to submit vouchers for an amount up to the full certified State contribution to the System ($1,671,426,000 for FY 2017) for payment from the General Revenue Fund.  SB 2047 appropriates $190 million of the annual required State contribution for FY 2017 from the State Pensions Fund instead of the General Revenue Fund.  This means that SURS will receive the remaining $1,481,426,000 from the General Revenue Fund for FY 2017 under the State Pension Funds Continuing Appropriation Act.

The State Pension Funds Continuing Appropriation Act also annually appropriates an amount equal to the full certified State contribution for CIP ($4,309,111 for FY 2017) from the General Revenue Fund to the Community College Health Insurance Security Fund.

Status: Governor Rauner Signed into Law on 6/30/2016 as Public Act 99-0524 (Senate Vote: 54-0-0; House Vote: 105-4-1).

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Senate

SB 1334
- Aspirational Diversity Goals for State Contracts
Sponsor(s): Senator James F. Clayborne Jr. and Representative Arthur Turner

   Became Public Act 99-0462 on 8/25/2015

SB 1334 establishes that, beginning January 1, 2016, it is the aspirational goal for a retirement system, pension fund, or investment board under the Illinois Pension Code to use emerging investment managers for not less than 20% of total funds under management.  

SB 1334 establishes that it is the aspirational goal that not less than 20% of investment advisors be minorities, females, and persons with disabilities.  

SB 1334 establishes that it is the aspirational goal to utilize businesses owned by minorities, females, and persons with disabilities for not less than 20% of contracts awarded for internet technology services, accounting services, insurance brokers, architectural and engineering services, and legal services.  

SB 1334 also makes changes to the Business Enterprise for Minorities, Females, and Persons with Disabilities Act.

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SB 1761
- No Investments in Companies that Boycott Israel
Sponsor(s): Senator Ira I. Silverstein and Representative Sara Feigenholtz

   Became Public Act 99-0128 on 7/23/2015

SB 1761 prohibits investments in companies that boycott Israel and streamlines the current divestiture policies for Iran and Sudan. 

SB 1761 defines boycotting Israel as "engaging in actions that are politically motivated and are intended to penalize, inflict economic harm on, or otherwise limit commercial relations with the State of Israel or companies based in the State of Israel or in territories controlled by the State of Israel." 

Additionally, SB 1761 creates the Illinois Investment Policy Board, consisting of 4 members appointed by the Governor and 3 members appointed by each of the Boards of the State Universities Retirement System, Teachers Retirement System, and Illinois State Board of Investments, respectively.   The Illinois Investment Policy Board will identify all Iran-restricted companies, Sudan-restricted companies, and companies that boycott Israel and develop a list of restricted companies for the retirement systems. 

The Illinois Investment Policy Board will also send a written notice to a company informing it of its status on the list of restricted companies and that it may become subject to divestiture by the retirement systems and will collect information from each retirement system regarding investments sold, redeemed, divested, or withdrawn from the list of restricted companies in accordance with the Act. 

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SB 2156
- SURS Participation, Basic Compensation, and Earnings Limitations
Sponsor(s): Senator Bill Cunningham and Representative Kelly M. Burke

   Became Public Act 99-0897 on 8/26/2016

SB 2156 makes the following changes for employees:

  • It excludes individuals who begin employment with the following employers on or after the effective date from participation under SURS: certain associations of community college boards, the Association of Illinois Middle-Grade Schools, the Illinois Association of School Administrators, the Illinois Association for Supervision and Curriculum Development, the Illinois Principals Association, the Illinois Association of School Business Officials, and the Illinois Special Olympics, and any entity not defined as any employer.  It also requires the SURS Board of Trustees to promulgate rules to determine whether a person is an employee covered under SURS and gives the Board final determination as to whether a person is an employee covered under SURS. 

  • It excludes amounts for bonuses, housing allowances, vehicle allowances, social club dues, and athletic club dues from the calculation of pensions for employees who first become participants of SURS on and after the effective date of the legislation.

  • It provides that if a participant, beneficiary, or annuitant fails to provide any information necessary for the calculation, payment, or finalization of a retirement, survivors, disability, or death benefit within 90 days of the System’s request for such information, then the System may cease processing the benefit and may not pay any additional benefit payment until the requested information is provided.

SB 2156 makes the following changes for employers:

  • It requires an employer to respond to a request from SURS for any information necessary for the proper administration of the System (including employment contracts) within 90 calendar days and to respond to a request pursuant to an employer audit conducted by the System within 60 calendar days.  

Beginning on the 91st calendar day after the System’s request for information necessary for the proper administration of the System, or the 61st calendar day if the request is pursuant to an employer audit, it allows the System to assess a penalty of $250 per calendar day until the System receives the information, with a maximum penalty of $25,000.   Should the employer fail to make the required payment within the earlier of one calendar year after receipt of the information by the System or one calendar year of the employer reaching the maximum penalty of $25,000, the legislation allows the System to seek payment from the Comptroller through State funds payable to the employer.

  • It requires employers under SURS to certify with each payroll submission that the information is correct and complies with all applicable State and federal laws.

SB 2156 also makes the following changes related to furloughs and voluntary pay reductions experienced by public higher education employees:

  • It allows a SURS participant to establish service and earnings credit for periods of furlough, beginning on or after July 1, 2015 and ending on or before June 30, 2017.  The participant must pay the required employee and employer contributions, in addition to compounded interest at the actuarially assumed rate of return (7.25%), to establish the service and earnings credit.  The compounded interest applies from the date of furlough until the date of payment. Application to the System must be made before December 31, 2018.

  • It allows a SURS participant to establish earnings credit for periods of a voluntary pay reduction taken in lieu of furlough, beginning on or after July 1, 2015 and ending on or before June 30, 2017.  The participant must pay the required employee and employer contributions, in addition to compounded interest at the actuarially assumed rate of return (7.25%), to establish the earnings.  The compounded interest applies from the date of the voluntary pay reduction until the date of payment. Application to the System must be made before December 31, 2018.

  • It requires SURS to include earnings that would have been paid to a participant had he or she not taken a period of furlough or a voluntary pay reduction in lieu of furlough beginning on or after July 1, 2015 and ending on or before June 30, 2017 for the purposes of determining whether the employer must pay the present value of earnings increases above 6% during the final rate of earnings period to SURS.

Finally, SB 2156 codifies the default investment fund under the Self-Managed Plan.

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