Bill Text: IL HB5851 | 2023-2024 | 103rd General Assembly | Introduced

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Bill Title: Amends the Budget Stabilization Act. Provides a transfer of specified amounts from the General Revenue Fund to the Pension Stabilization Fund for fiscal years 2030 through 2040. Amends the Illinois Pension Code. With regard to each of the 5 State-funded retirement systems, provides that for State fiscal years 2026 through 2034, the minimum contribution to the System to be made by the State for each State fiscal year shall be an amount determined by the System to be sufficient to bring the total assets of the System up to 100% of the total actuarial liabilities of the System by the end of State fiscal year 2048. Provides that the required State contribution shall be calculated each year as a level percentage of payroll over the years remaining to and including fiscal year 2048 and shall be determined under the projected unit credit actuarial cost method. Provides that for State fiscal years 2035 through 2048, the minimum contribution to the System to be made by the State for each State fiscal year shall be the contribution amount for the upcoming State fiscal year estimated in the previous year's actuarial valuation plus an adjustment for differences between the unfunded liability reported in the current actuarial valuation and the unfunded liability reported in the previous year's actuarial valuation, such that the total assets of the System equal 100% of the total actuarial liabilities of the System 20 years after the State fiscal year during which the contribution is made. Sets forth a funding formula for State fiscal year 2049 and thereafter. Repeals a provision requiring the Commission on Government Forecasting and Accountability to consider and determine whether certain funding goals are appropriate. Makes conforming and other changes. Effective immediately.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Introduced) 2024-05-16 - Referred to Rules Committee [HB5851 Detail]

Download: Illinois-2023-HB5851-Introduced.html

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103RD GENERAL ASSEMBLY State of Illinois 2023 and 2024 HB5851 Introduced , by Rep. Stephanie A. Kifowit SYNOPSIS AS INTRODUCED:
30 ILCS 122/20
40 ILCS 5/2-124 from Ch. 108 1/2, par. 2-124
40 ILCS 5/14-131
40 ILCS 5/15-155 from Ch. 108 1/2, par. 15-155
40 ILCS 5/16-158 from Ch. 108 1/2, par. 16-158
40 ILCS 5/18-131 from Ch. 108 1/2, par. 18-131
40 ILCS 5/1-103.3 rep.
Amends the Budget Stabilization Act. Provides a transfer of specified amounts from the General Revenue Fund to the Pension Stabilization Fund for fiscal years 2030 through 2040. Amends the Illinois Pension Code. With regard to each of the 5 State-funded retirement systems, provides that for State fiscal years 2026 through 2034, the minimum contribution to the System to be made by the State for each State fiscal year shall be an amount determined by the System to be sufficient to bring the total assets of the System up to 100% of the total actuarial liabilities of the System by the end of State fiscal year 2048. Provides that the required State contribution shall be calculated each year as a level percentage of payroll over the years remaining to and including fiscal year 2048 and shall be determined under the projected unit credit actuarial cost method. Provides that for State fiscal years 2035 through 2048, the minimum contribution to the System to be made by the State for each State fiscal year shall be the contribution amount for the upcoming State fiscal year estimated in the previous year's actuarial valuation plus an adjustment for differences between the unfunded liability reported in the current actuarial valuation and the unfunded liability reported in the previous year's actuarial valuation, such that the total assets of the System equal 100% of the total actuarial liabilities of the System 20 years after the State fiscal year during which the contribution is made. Sets forth a funding formula for State fiscal year 2049 and thereafter. Repeals a provision requiring the Commission on Government Forecasting and Accountability to consider and determine whether certain funding goals are appropriate. Makes conforming and other changes. Effective immediately.
LRB103 40703 RPS 73498 b
A BILL FOR
HB5851 LRB103 40703 RPS 73498 b
AN ACT concerning public employee benefits.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 5. The Budget Stabilization Act is amended by
changing Section 20 as follows:
(30 ILCS 122/20)
(Text of Section WITHOUT the changes made by P.A. 98-599,
which has been held unconstitutional)
Sec. 20. Pension Stabilization Fund.
(a) The Pension Stabilization Fund is hereby created as a
special fund in the State treasury. Moneys in the fund shall be
used for the sole purpose of making payments to the designated
retirement systems as provided in Section 25.
(b) For each fiscal year when the General Assembly's
appropriations and transfers or diversions as required by law
from general funds do not exceed 99% of the estimated general
funds revenues pursuant to subsection (a) of Section 10, the
Comptroller shall transfer from the General Revenue Fund as
provided by this Section a total amount equal to 0.5% of the
estimated general funds revenues to the Pension Stabilization
Fund.
(c) For each fiscal year when the General Assembly's
appropriations and transfers or diversions as required by law

HB5851 - 2 - LRB103 40703 RPS 73498 b
from general funds do not exceed 98% of the estimated general
funds revenues pursuant to subsection (b) of Section 10, the
Comptroller shall transfer from the General Revenue Fund as
provided by this Section a total amount equal to 1.0% of the
estimated general funds revenues to the Pension Stabilization
Fund.
(c-5) In addition to any other transfers that may be
provided by law, the Comptroller shall transfer from the
General Revenue Fund to the Pension Stabilization Fund the
amount set forth as follows for each of the specified fiscal
years:
Fiscal Year Amount
2030 $175,000,000
2031 through 2033 $250,000,000
2034 through 2040 $750,000,000
(d) The Comptroller shall transfer 1/12 of the total
amount to be transferred each fiscal year under this Section
into the Pension Stabilization Fund on the first day of each
month of that fiscal year or as soon thereafter as possible;
except that the final transfer of the fiscal year shall be made
as soon as practical after the August 31 following the end of
the fiscal year.
Before the final transfer for a fiscal year is made, the
Comptroller shall reconcile the estimated general funds
revenues used in calculating the other transfers under this
Section for that fiscal year with the actual general funds

HB5851 - 3 - LRB103 40703 RPS 73498 b
revenues for that fiscal year. The final transfer for the
fiscal year shall be adjusted so that the total amount
transferred under this Section for that fiscal year is equal
to the percentage specified in subsection (b) or (c) of this
Section, whichever is applicable, of the actual general funds
revenues for that fiscal year. The actual general funds
revenues for the fiscal year shall be calculated in a manner
consistent with subsection (c) of Section 10 of this Act.
(Source: P.A. 94-839, eff. 6-6-06.)
Section 10. The Illinois Pension Code is amended by
changing Sections 2-124, 14-131, 15-155, 16-158, and 18-131 as
follows:
(40 ILCS 5/2-124) (from Ch. 108 1/2, par. 2-124)
Sec. 2-124. Contributions by State.
(a) The State shall make contributions to the System by
appropriations of amounts which, together with the
contributions of participants, interest earned on investments,
and other income will meet the cost of maintaining and
administering the System on a 100% 90% funded basis by the end
of State fiscal year 2048 in accordance with actuarial
recommendations.
(b) 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

HB5851 - 4 - LRB103 40703 RPS 73498 b
Board and the prescribed rate of interest, using the formula
in subsection (c). In making its determination, the Board
shall disregard any contributions scheduled to be received in
a future State fiscal year under the Budget Stabilization Act.
(c) Beginning in State fiscal year 2049, the minimum
contribution to the System to be made by the State for each
State fiscal year shall be the contribution amount for the
upcoming State fiscal year estimated in the previous year's
actuarial valuation required by Section 2-134 plus the amounts
required under subsection (c-5), such that the total assets of
the System equal 100% of the total actuarial liabilities of
the System 20 years after the State fiscal year during which
the contribution is made. The required State contribution
shall be determined under the entry age normal actuarial cost
method.
For State fiscal years 2035 through 2048, the minimum
contribution to the System to be made by the State for each
State fiscal year shall be the contribution amount for the
upcoming State fiscal year estimated in the previous year's
actuarial valuation required by Section 2-134 plus the amounts
required under subsection (c-5), such that the total assets of
the System equal 100% of the total actuarial liabilities of
the System 20 years after the State fiscal year during which
the contribution is made. 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

HB5851 - 5 - LRB103 40703 RPS 73498 b
including fiscal year 2048 and shall be determined under the
projected unit credit actuarial cost method.
For State fiscal years 2026 through 2034, the minimum
contribution to the System to be made by the State for each
State fiscal year shall be an amount determined by the System
to be sufficient to bring the total assets of the System up to
100% of the total actuarial liabilities of the System by the
end of State fiscal year 2048. 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 2048 and shall be determined under
the projected unit credit actuarial cost method.
For State fiscal years 2012 through 2025 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% of
the total actuarial liabilities of the System by the end of
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.
A change in an actuarial or investment assumption that
increases or decreases the required State contribution and
first applies in State fiscal year 2018 and before State
fiscal year 2035 or thereafter shall be implemented in equal

HB5851 - 6 - LRB103 40703 RPS 73498 b
annual amounts over a 5-year period beginning in the State
fiscal year in which the actuarial 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
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.
Notwithstanding any other provision of this Article, the
total required State contribution for State fiscal year 2006
is $4,157,000.
Notwithstanding any other provision of this Article, the
total required State contribution for State fiscal year 2007

HB5851 - 7 - LRB103 40703 RPS 73498 b
is $5,220,300.
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
State is contributing at the rate otherwise required under
this Section.
Notwithstanding any other provision of this Article, the
total required State contribution for State fiscal year 2010
is $10,454,000 and shall be made from the proceeds of bonds
sold in fiscal year 2010 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 2010, and (iii) any reduction in bond
proceeds due to the issuance of discounted bonds, if
applicable.
Notwithstanding any other provision of this Article, the
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 2-134 and shall be made from the
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

HB5851 - 8 - LRB103 40703 RPS 73498 b
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.
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.
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
calculated under this Section and certified under Section
2-134, 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

HB5851 - 9 - LRB103 40703 RPS 73498 b
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
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
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.
(c-5) For State fiscal year 2035 and each State fiscal
year thereafter, the contribution to the System to be made by
the State shall include an adjustment for differences between
the unfunded liability reported in the current actuarial
valuation and the unfunded liability reported in the previous
year's actuarial valuation required by Section 2-134. The
adjustment shall be implemented in equal annual amounts over a
20-year period beginning in the State fiscal year in which the

HB5851 - 10 - LRB103 40703 RPS 73498 b
current actuarial valuation is used to determine the required
State contribution under subsection (c).
(d) 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.
This subsection is inoperative on and after July 1, 2034.
(e) 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. 100-23, eff. 7-6-17.)
(40 ILCS 5/14-131)
Sec. 14-131. Contributions by State.
(a) The State shall make contributions to the System by
appropriations of amounts which, together with other employer
contributions from trust, federal, and other funds, employee

HB5851 - 11 - LRB103 40703 RPS 73498 b
contributions, investment income, and other income, will be
sufficient to meet the cost of maintaining and administering
the System on a 100% 90% funded basis by the end of State
fiscal year 2048 in accordance with actuarial recommendations.
For the purposes of this Section and Section 14-135.08,
references to State contributions refer only to employer
contributions and do not include employee contributions that
are picked up or otherwise paid by the State or a department on
behalf of the employee.
(b) The Board shall determine the total amount of State
contributions required for each fiscal year on the basis of
the actuarial tables and other assumptions adopted by the
Board, using the formula in subsection (e). In making its
determination, the Board shall disregard any contributions
scheduled to be received in a future State fiscal year under
the Budget Stabilization Act.
The Board shall also determine a State contribution rate
for each fiscal year, expressed as a percentage of payroll,
based on the total required State contribution for that fiscal
year (less the amount received by the System from
appropriations under Section 8.12 of the State Finance Act and
Section 1 of the State Pension Funds Continuing Appropriation
Act, if any, for the fiscal year ending on the June 30
immediately preceding the applicable November 15 certification
deadline), the estimated payroll (including all forms of
compensation) for personal services rendered by eligible

HB5851 - 12 - LRB103 40703 RPS 73498 b
employees, and the recommendations of the actuary.
For the purposes of this Section and Section 14.1 of the
State Finance Act, the term "eligible employees" includes
employees who participate in the System, persons who may elect
to participate in the System but have not so elected, persons
who are serving a qualifying period that is required for
participation, and annuitants employed by a department as
described in subdivision (a)(1) or (a)(2) of Section 14-111.
(c) Contributions shall be made by the several departments
for each pay period by warrants drawn by the State Comptroller
against their respective funds or appropriations based upon
vouchers stating the amount to be so contributed. These
amounts shall be based on the full rate certified by the Board
under Section 14-135.08 for that fiscal year. From March 5,
2004 (the effective date of Public Act 93-665) through the
payment of the final payroll from fiscal year 2004
appropriations, the several departments shall not make
contributions for the remainder of fiscal year 2004 but shall
instead make payments as required under subsection (a-1) of
Section 14.1 of the State Finance Act. The several departments
shall resume those contributions at the commencement of fiscal
year 2005.
(c-1) Notwithstanding subsection (c) of this Section, for
fiscal years 2010, 2012, and each fiscal year thereafter,
contributions by the several departments are not required to
be made for General Revenue Funds payrolls processed by the

HB5851 - 13 - LRB103 40703 RPS 73498 b
Comptroller. Payrolls paid by the several departments from all
other State funds must continue to be processed pursuant to
subsection (c) of this Section.
(c-2) For State fiscal years 2010, 2012, and each fiscal
year thereafter, on or as soon as possible after the 15th day
of each month, the Board shall submit vouchers for payment of
State contributions to the System, in a total monthly amount
of one-twelfth of the fiscal year General Revenue Fund
contribution as certified by the System pursuant to Section
14-135.08 of the Illinois Pension Code.
(d) If an employee is paid from trust funds or federal
funds, the department or other employer shall pay employer
contributions from those funds to the System at the certified
rate, unless the terms of the trust or the federal-State
agreement preclude the use of the funds for that purpose, in
which case the required employer contributions shall be paid
by the State.
(e) Beginning in State fiscal year 2049, the minimum
contribution to the System to be made by the State for each
State fiscal year shall be the contribution amount for the
upcoming State fiscal year estimated in the previous year's
actuarial valuation required by Section 14-135.08 plus the
amounts required under subsection (e-5), such that the total
assets of the System equal 100% of the total actuarial
liabilities of the System 20 years after the State fiscal year
during which the contribution is made. The required State

HB5851 - 14 - LRB103 40703 RPS 73498 b
contribution shall be determined under the entry age normal
actuarial cost method.
For State fiscal years 2035 through 2048, the minimum
contribution to the System to be made by the State for each
State fiscal year shall be the contribution amount for the
upcoming State fiscal year estimated in the previous year's
actuarial valuation required by Section 14-135.08 plus the
amounts required under subsection (e-5), such that the total
assets of the System equal 100% of the total actuarial
liabilities of the System 20 years after the State fiscal year
during which the contribution is made. 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 2048 and shall be
determined under the projected unit credit actuarial cost
method.
For State fiscal years 2026 through 2034, the minimum
contribution to the System to be made by the State for each
State fiscal year shall be an amount determined by the System
to be sufficient to bring the total assets of the System up to
100% of the total actuarial liabilities of the System by the
end of State fiscal year 2048. 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 2048 and shall be determined under
the projected unit credit actuarial cost method.

HB5851 - 15 - LRB103 40703 RPS 73498 b
For State fiscal years 2012 through 2025 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% of
the total actuarial liabilities of the System by the end of
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.
A change in an actuarial or investment assumption that
increases or decreases the required State contribution and
first applies in State fiscal year 2018 and before State
fiscal year 2035 or thereafter shall be implemented in equal
annual amounts over a 5-year period beginning in the State
fiscal year in which the actuarial 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

HB5851 - 16 - LRB103 40703 RPS 73498 b
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; except
that (i) for State fiscal year 1998, for all purposes of this
Code and any other law of this State, the certified percentage
of the applicable employee payroll shall be 5.052% for
employees earning eligible creditable service under Section
14-110 and 6.500% for all other employees, notwithstanding any
contrary certification made under Section 14-135.08 before
July 7, 1997 (the effective date of Public Act 90-65), and (ii)
in the following specified State fiscal years, the State
contribution to the System shall not be less than the
following indicated percentages of the applicable employee
payroll, even if the indicated percentage will produce a State
contribution in excess of the amount otherwise required under
this subsection and subsection (a): 9.8% in FY 1999; 10.0% in
FY 2000; 10.2% in FY 2001; 10.4% in FY 2002; 10.6% in FY 2003;
and 10.8% in FY 2004.
Beginning in State fiscal year 2046, the minimum State
contribution for each fiscal year shall be the amount needed

HB5851 - 17 - LRB103 40703 RPS 73498 b
to maintain the total assets of the System at 90% of the total
actuarial liabilities of the System.
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.
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
calculated under this Section and certified under Section
14-135.08, 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

HB5851 - 18 - LRB103 40703 RPS 73498 b
the Comptroller, that is the same as the System's portion of
the total moneys distributed under subsection (d) of Section
7.2 of the General Obligation Bond Act.
(e-5) For State fiscal year 2035 and each State fiscal
year thereafter, the contribution to the System to be made by
the State shall include an adjustment for differences between
the unfunded liability reported in the current actuarial
valuation and the unfunded liability reported in the previous
year's actuarial valuation required by Section 14-135.08. The
adjustment shall be implemented in equal annual amounts over a
20-year period beginning in the State fiscal year in which the
current actuarial valuation is used to determine the required
State contribution under subsection (e).
(f) (Blank).
(g) 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.
This subsection is inoperative on and after July 1, 2034.

HB5851 - 19 - LRB103 40703 RPS 73498 b
(h) 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.
(i) (Blank).
(j) (Blank).
(k) For fiscal year 2012 and each fiscal year thereafter,
after the submission of all payments for eligible employees
from personal services line items paid from the General
Revenue Fund in the fiscal year have been made, the
Comptroller shall provide to the System a certification of the
sum of all expenditures in the fiscal year for personal
services. Upon receipt of the certification, the System shall
determine the amount due to the System based on the full rate
certified by the Board under Section 14-135.08 for the fiscal
year in order to meet the State's obligation under this
Section. The System shall compare this amount due to the
amount received by the System for the fiscal year. If the
amount due is more than the amount received, the difference
shall be termed the "Prior Fiscal Year Shortfall" for purposes
of this Section, and the Prior Fiscal Year Shortfall shall be
satisfied under Section 1.2 of the State Pension Funds
Continuing Appropriation Act. If the amount due is less than
the amount received, the difference shall be termed the "Prior
Fiscal Year Overpayment" for purposes of this Section, and the

HB5851 - 20 - LRB103 40703 RPS 73498 b
Prior Fiscal Year Overpayment shall be repaid by the System to
the General Revenue Fund as soon as practicable after the
certification.
(Source: P.A. 100-23, eff. 7-6-17; 100-587, eff. 6-4-18;
101-10, eff. 6-5-19.)
(40 ILCS 5/15-155) (from Ch. 108 1/2, par. 15-155)
Sec. 15-155. Employer contributions.
(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
maintaining and administering the System on a 100% 90% funded
basis by the end of State fiscal year 2048 in accordance with
actuarial recommendations.
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). In making its determination, the
Board shall disregard any contributions scheduled to be
received in a future State fiscal year under the Budget
Stabilization Act.
(a-1) Beginning in State fiscal year 2049, the minimum
contribution to the System to be made by the State for each

HB5851 - 21 - LRB103 40703 RPS 73498 b
State fiscal year shall be the contribution amount for the
upcoming State fiscal year estimated in the previous year's
actuarial valuation required by subsection (a-5) of Section
15-165 plus the amounts required under subsection (a-1.5),
such that the total assets of the System equal 100% of the
total actuarial liabilities of the System 20 years after the
State fiscal year during which the contribution is made. The
required State contribution shall be determined under the
entry age normal actuarial cost method.
For State fiscal years 2035 through 2048, the minimum
contribution to the System to be made by the State for each
State fiscal year shall be the contribution amount for the
upcoming State fiscal year estimated in the previous year's
actuarial valuation required by subsection (a-5) of Section
15-165 plus the amounts required under subsection (a-1.5),
such that the total assets of the System equal 100% of the
total actuarial liabilities of the System 20 years after the
State fiscal year during which the contribution is made. 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 2048 and
shall be determined under the projected unit credit actuarial
cost method.
For State fiscal years 2026 through 2034, the minimum
contribution to the System to be made by the State for each
State fiscal year shall be an amount determined by the System

HB5851 - 22 - LRB103 40703 RPS 73498 b
to be sufficient to bring the total assets of the System up to
100% of the total actuarial liabilities of the System by the
end of State fiscal year 2048. 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 2048 and shall be determined under
the projected unit credit actuarial cost method.
For State fiscal years 2012 through 2025 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% of
the total actuarial liabilities of the System by the end of
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.
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 and before State
fiscal year 2035 or thereafter shall be implemented in equal

HB5851 - 23 - LRB103 40703 RPS 73498 b
annual amounts over a 5-year period beginning in the State
fiscal year in which the actuarial 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
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.
Notwithstanding any other provision of this Article, the
total required State contribution for State fiscal year 2006
is $166,641,900.
Notwithstanding any other provision of this Article, the
total required State contribution for State fiscal year 2007

HB5851 - 24 - LRB103 40703 RPS 73498 b
is $252,064,100.
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
State is contributing at the rate otherwise required under
this Section.
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
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
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)

HB5851 - 25 - LRB103 40703 RPS 73498 b
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.
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.
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
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

HB5851 - 26 - LRB103 40703 RPS 73498 b
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
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
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.
(a-1.5) For State fiscal year 2035 and each State fiscal
year thereafter, the contribution to the System to be made by
the State shall include an adjustment for differences between
the unfunded liability reported in the current actuarial
valuation and the unfunded liability reported in the previous
year's actuarial valuation required by subsection (a-5) of
Section 15-165. The adjustment shall be implemented in equal
annual amounts over a 20-year period beginning in the State

HB5851 - 27 - LRB103 40703 RPS 73498 b
fiscal year in which the current actuarial valuation is used
to determine the required State contribution under subsection
(a-1).
(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
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

HB5851 - 28 - LRB103 40703 RPS 73498 b
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
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

HB5851 - 29 - LRB103 40703 RPS 73498 b
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.
(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.
(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
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

HB5851 - 30 - LRB103 40703 RPS 73498 b
funds, shall be payable solely from appropriations to the
Illinois Community College Board or the System for employer
contributions.
(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).
(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.
(f) Normal costs under this Section means liability for
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
connection therewith.
(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
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

HB5851 - 31 - LRB103 40703 RPS 73498 b
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
application for recalculation, the System shall review the
application and, if appropriate, recalculate the amount due.
The employer contributions required under this subsection

HB5851 - 32 - LRB103 40703 RPS 73498 b
(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
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.

HB5851 - 33 - LRB103 40703 RPS 73498 b
(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.
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.
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
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

HB5851 - 34 - LRB103 40703 RPS 73498 b
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
an emergency declaration limiting such activities.
(i) When assessing payment for any amount due under
subsection (g), the System shall exclude any salary increase

HB5851 - 35 - LRB103 40703 RPS 73498 b
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), 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.
(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
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

HB5851 - 36 - LRB103 40703 RPS 73498 b
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
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.

HB5851 - 37 - LRB103 40703 RPS 73498 b
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
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

HB5851 - 38 - LRB103 40703 RPS 73498 b
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.
(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.
This subsection is inoperative on and after July 1, 2034.
(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

HB5851 - 39 - LRB103 40703 RPS 73498 b
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; 102-764, eff.
5-13-22.)
(40 ILCS 5/16-158) (from Ch. 108 1/2, par. 16-158)
Sec. 16-158. Contributions by State and other employing
units.
(a) The State shall make contributions to the System by
means of appropriations from the Common School Fund and other
State funds of amounts which, together with other employer
contributions, employee contributions, investment income, and
other income, will be sufficient to meet the cost of
maintaining and administering the System on a 100% 90% funded
basis by the end of State fiscal year 2048 in accordance with
actuarial recommendations.
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 (b-3). In making its determination, the
Board shall disregard any contributions scheduled to be
received in a future State fiscal year under the Budget
Stabilization Act.
(a-1) Annually, on or before November 15 until November

HB5851 - 40 - LRB103 40703 RPS 73498 b
15, 2011, the Board shall certify to the Governor the amount of
the required State contribution for the coming fiscal year.
The certification under this subsection (a-1) shall include a
copy of the actuarial recommendations upon which it is based
and shall specifically identify the System's projected State
normal cost for that fiscal year.
On or before May 1, 2004, the Board shall recalculate and
recertify to the Governor the amount of the required State
contribution to the System for State fiscal year 2005, taking
into account the amounts appropriated to and received by the
System under subsection (d) of Section 7.2 of the General
Obligation Bond Act.
On or before July 1, 2005, the Board shall recalculate and
recertify to the Governor the amount of the required State
contribution to the System for State fiscal year 2006, taking
into account the changes in required State contributions made
by Public Act 94-4.
On or before April 1, 2011, the Board shall recalculate
and recertify to the Governor the amount of the required State
contribution to the System for State fiscal year 2011,
applying the changes made by Public Act 96-889 to the System's
assets and liabilities as of June 30, 2009 as though Public Act
96-889 was approved on that date.
(a-5) On or before November 1 of each year, beginning
November 1, 2012, the Board shall submit to the State Actuary,
the Governor, and the General Assembly a proposed

HB5851 - 41 - LRB103 40703 RPS 73498 b
certification of the amount of the required State contribution
to the System for the next fiscal year, along with all of the
actuarial assumptions, calculations, and data upon which that
proposed certification is based. On or before January 1 of
each year, beginning January 1, 2013, the State Actuary shall
issue a preliminary report concerning the proposed
certification and identifying, if necessary, recommended
changes in actuarial assumptions that the Board must consider
before finalizing its certification of the required State
contributions. On or before January 15, 2013 and each January
15 thereafter, the Board shall certify to the Governor and the
General Assembly the amount of the required State contribution
for the next fiscal year. The Board's certification must note
any deviations from the State Actuary's recommended changes,
the reason or reasons for not following the State Actuary's
recommended changes, and the fiscal impact of not following
the State Actuary's recommended changes on the required State
contribution.
(a-10) By November 1, 2017, the Board shall recalculate
and recertify to the State Actuary, the Governor, and the
General Assembly the amount of the State contribution to the
System for State fiscal year 2018, taking into account the
changes in required State contributions made by Public Act
100-23. The State Actuary shall review the assumptions and
valuations underlying the Board's revised certification and
issue a preliminary report concerning the proposed

HB5851 - 42 - LRB103 40703 RPS 73498 b
recertification and identifying, if necessary, recommended
changes in actuarial assumptions that the Board must consider
before finalizing its certification of the required State
contributions. The Board's final certification must note any
deviations from the State Actuary's recommended changes, the
reason or reasons for not following the State Actuary's
recommended changes, and the fiscal impact of not following
the State Actuary's recommended changes on the required State
contribution.
(a-15) On or after June 15, 2019, but no later than June
30, 2019, the Board shall recalculate and recertify to the
Governor and the General Assembly the amount of the State
contribution to the System for State fiscal year 2019, taking
into account the changes in required State contributions made
by Public Act 100-587. The recalculation shall be made using
assumptions adopted by the Board for the original fiscal year
2019 certification. The monthly voucher for the 12th month of
fiscal year 2019 shall be paid by the Comptroller after the
recertification required pursuant to this subsection is
submitted to the Governor, Comptroller, and General Assembly.
The recertification submitted to the General Assembly shall be
filed with the Clerk of the House of Representatives and the
Secretary of the Senate in electronic form only, in the manner
that the Clerk and the Secretary shall direct.
(b) Through State fiscal year 1995, the State
contributions shall be paid to the System in accordance with

HB5851 - 43 - LRB103 40703 RPS 73498 b
Section 18-7 of the School Code.
(b-1) Beginning in State fiscal year 1996, on the 15th day
of each month, or as soon thereafter as may be practicable, the
Board shall submit vouchers for payment of State contributions
to the System, in a total monthly amount of one-twelfth of the
required annual State contribution certified under subsection
(a-1). From March 5, 2004 (the effective date of Public Act
93-665) through June 30, 2004, the Board shall not submit
vouchers for the remainder of fiscal year 2004 in excess of the
fiscal year 2004 certified contribution amount determined
under this Section after taking into consideration the
transfer to the System under subsection (a) of Section 6z-61
of the State Finance Act. These vouchers shall be paid by the
State Comptroller and Treasurer by warrants drawn on the funds
appropriated to the System for that fiscal year.
If in any month the amount remaining unexpended from all
other appropriations to the System for the applicable fiscal
year (including the appropriations to the System under Section
8.12 of the State Finance Act and Section 1 of the State
Pension Funds Continuing Appropriation Act) is less than the
amount lawfully vouchered under this subsection, the
difference shall be paid from the Common School Fund under the
continuing appropriation authority provided in Section 1.1 of
the State Pension Funds Continuing Appropriation Act.
(b-2) Allocations from the Common School Fund apportioned
to school districts not coming under this System shall not be

HB5851 - 44 - LRB103 40703 RPS 73498 b
diminished or affected by the provisions of this Article.
(b-3) Beginning in State fiscal year 2049, the minimum
contribution to the System to be made by the State for each
State fiscal year shall be the contribution amount for the
upcoming State fiscal year estimated in the previous year's
actuarial valuation required by subsection (a-5) plus the
amounts required under subsection (b-3.5), such that the total
assets of the System equal 100% of the total actuarial
liabilities of the System 20 years after the State fiscal year
during which the contribution is made. The required State
contribution shall be determined under the entry age normal
actuarial cost method.
For State fiscal years 2035 through 2048, the minimum
contribution to the System to be made by the State for each
State fiscal year shall be the contribution amount for the
upcoming State fiscal year estimated in the previous year's
actuarial valuation required by subsection (a-5) plus the
amounts required under subsection (b-3.5), such that the total
assets of the System equal 100% of the total actuarial
liabilities of the System 20 years after the State fiscal year
during which the contribution is made. 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 2048 and shall be
determined under the projected unit credit actuarial cost
method.

HB5851 - 45 - LRB103 40703 RPS 73498 b
For State fiscal years 2026 through 2034, the minimum
contribution to the System to be made by the State for each
State fiscal year shall be an amount determined by the System
to be sufficient to bring the total assets of the System up to
100% of the total actuarial liabilities of the System by the
end of State fiscal year 2048. 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 2048 and shall be determined under
the projected unit credit actuarial cost method.
For State fiscal years 2012 through 2025 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% of
the total actuarial liabilities of the System by the end of
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.
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

HB5851 - 46 - LRB103 40703 RPS 73498 b
increases or decreases the required State contribution and
first applies in State fiscal year 2018 and before State
fiscal year 2035 or thereafter shall be implemented in equal
annual amounts over a 5-year period beginning in the State
fiscal year in which the actuarial 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
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; except
that in the following specified State fiscal years, the State
contribution to the System shall not be less than the

HB5851 - 47 - LRB103 40703 RPS 73498 b
following indicated percentages of the applicable employee
payroll, even if the indicated percentage will produce a State
contribution in excess of the amount otherwise required under
this subsection and subsection (a), and notwithstanding any
contrary certification made under subsection (a-1) before May
27, 1998 (the effective date of Public Act 90-582): 10.02% in
FY 1999; 10.77% in FY 2000; 11.47% in FY 2001; 12.16% in FY
2002; 12.86% in FY 2003; and 13.56% in FY 2004.
Notwithstanding any other provision of this Article, the
total required State contribution for State fiscal year 2006
is $534,627,700.
Notwithstanding any other provision of this Article, the
total required State contribution for State fiscal year 2007
is $738,014,500.
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
State is contributing at the rate otherwise required under
this Section.
Notwithstanding any other provision of this Article, the
total required State contribution for State fiscal year 2010
is $2,089,268,000 and shall be made from the proceeds of bonds
sold in fiscal year 2010 pursuant to Section 7.2 of the General
Obligation Bond Act, less (i) the pro rata share of bond sale

HB5851 - 48 - LRB103 40703 RPS 73498 b
expenses determined by the System's share of total bond
proceeds, (ii) any amounts received from the Common School
Fund in fiscal year 2010, and (iii) any reduction in bond
proceeds due to the issuance of discounted bonds, if
applicable.
Notwithstanding any other provision of this Article, the
total required State contribution for State fiscal year 2011
is the amount recertified by the System on or before April 1,
2011 pursuant to subsection (a-1) of this Section and shall be
made from the 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 Common School Fund in fiscal year 2011, and
(iii) any reduction in bond proceeds due to the issuance of
discounted bonds, if applicable. This amount shall include, in
addition to the amount certified by the System, an amount
necessary to meet employer contributions required by the State
as an employer under paragraph (e) of this Section, which may
also be used by the System for contributions required by
paragraph (a) of Section 16-127.
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.
Amounts received by the System pursuant to Section 25 of

HB5851 - 49 - LRB103 40703 RPS 73498 b
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.
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
calculated under this Section and certified under subsection
(a-1), 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
the total moneys distributed under subsection (d) of Section
7.2 of the General Obligation Bond Act. In determining this

HB5851 - 50 - LRB103 40703 RPS 73498 b
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
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.
(b-3.5) For State fiscal year 2035 and each State fiscal
year thereafter, the contribution to the System to be made by
the State shall include an adjustment for differences between
the unfunded liability reported in the current actuarial
valuation and the unfunded liability reported in the previous
year's actuarial valuation required by subsection (a-5). The
adjustment shall be implemented in equal annual amounts over a
20-year period beginning in the State fiscal year in which the
current actuarial valuation is used to determine the required
State contribution under subsection (b-3).
(b-4) 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,

HB5851 - 51 - LRB103 40703 RPS 73498 b
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 (b) 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 (b) 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
16-158.3, 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 (b-4)

HB5851 - 52 - LRB103 40703 RPS 73498 b
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.
(c) Payment of the required State contributions and of all
pensions, retirement annuities, death benefits, refunds, and
other benefits granted under or assumed by this System, and
all expenses in connection with the administration and
operation thereof, are obligations of the State.
If members are paid from special trust or federal funds
which are administered by the employing unit, whether school
district or other unit, the employing unit shall pay to the
System from such funds the full accruing retirement costs
based upon that service, which, beginning July 1, 2017, shall
be at a rate, expressed as a percentage of salary, equal to the
total employer's normal cost, expressed as a percentage of
payroll, as determined by the System. Employer contributions,
based on salary paid to members from federal funds, may be
forwarded by the distributing agency of the State of Illinois
to the System prior to allocation, in an amount determined in
accordance with guidelines established by such agency and the
System. Any contribution for fiscal year 2015 collected as a
result of the change made by Public Act 98-674 shall be
considered a State contribution under subsection (b-3) of this
Section.
(d) Effective July 1, 1986, any employer of a teacher as

HB5851 - 53 - LRB103 40703 RPS 73498 b
defined in paragraph (8) of Section 16-106 shall pay the
employer's normal cost of benefits based upon the teacher's
service, in addition to employee contributions, as determined
by the System. Such employer contributions shall be forwarded
monthly in accordance with guidelines established by the
System.
However, with respect to benefits granted under Section
16-133.4 or 16-133.5 to a teacher as defined in paragraph (8)
of Section 16-106, the employer's contribution shall be 12%
(rather than 20%) of the member's highest annual salary rate
for each year of creditable service granted, and the employer
shall also pay the required employee contribution on behalf of
the teacher. For the purposes of Sections 16-133.4 and
16-133.5, a teacher as defined in paragraph (8) of Section
16-106 who is serving in that capacity while on leave of
absence from another employer under this Article shall not be
considered an employee of the employer from which the teacher
is on leave.
(e) Beginning July 1, 1998, every employer of a teacher
shall pay to the System an employer contribution computed as
follows:
(1) Beginning July 1, 1998 through June 30, 1999, the
employer contribution shall be equal to 0.3% of each
teacher's salary.
(2) Beginning July 1, 1999 and thereafter, the
employer contribution shall be equal to 0.58% of each

HB5851 - 54 - LRB103 40703 RPS 73498 b
teacher's salary.
The school district or other employing unit may pay these
employer contributions out of any source of funding available
for that purpose and shall forward the contributions to the
System on the schedule established for the payment of member
contributions.
These employer contributions are intended to offset a
portion of the cost to the System of the increases in
retirement benefits resulting from Public Act 90-582.
Each employer of teachers is entitled to a credit against
the contributions required under this subsection (e) with
respect to salaries paid to teachers for the period January 1,
2002 through June 30, 2003, equal to the amount paid by that
employer under subsection (a-5) of Section 6.6 of the State
Employees Group Insurance Act of 1971 with respect to salaries
paid to teachers for that period.
The additional 1% employee contribution required under
Section 16-152 by Public Act 90-582 is the responsibility of
the teacher and not the teacher's employer, unless the
employer agrees, through collective bargaining or otherwise,
to make the contribution on behalf of the teacher.
If an employer is required by a contract in effect on May
1, 1998 between the employer and an employee organization to
pay, on behalf of all its full-time employees covered by this
Article, all mandatory employee contributions required under
this Article, then the employer shall be excused from paying

HB5851 - 55 - LRB103 40703 RPS 73498 b
the employer contribution required under this subsection (e)
for the balance of the term of that contract. The employer and
the employee organization shall jointly certify to the System
the existence of the contractual requirement, in such form as
the System may prescribe. This exclusion shall cease upon the
termination, extension, or renewal of the contract at any time
after May 1, 1998.
(f) If the amount of a teacher's salary for any school year
used to determine final average salary exceeds the member's
annual full-time salary rate with the same employer for the
previous school year by more than 6%, the teacher'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
salary 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. If a teacher's salary for the 2005-2006 school
year is used to determine final average salary under this
subsection (f), then the changes made to this subsection (f)
by Public Act 94-1057 shall apply in calculating whether the
increase in his or her salary is in excess of 6%. For the
purposes of this Section, change in employment under Section
10-21.12 of the School Code on or after June 1, 2005 shall

HB5851 - 56 - LRB103 40703 RPS 73498 b
constitute a change in employer. The System may require the
employer to provide any pertinent information or
documentation. The changes made to this subsection (f) by
Public Act 94-1111 apply without regard to whether the teacher
was in service on or after its effective date.
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 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
(g), (g-5), (g-10), (g-15), (g-20), or (h) 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
application for recalculation, the System shall review the
application and, if appropriate, recalculate the amount due.
The employer contributions required under this subsection
(f) 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

HB5851 - 57 - LRB103 40703 RPS 73498 b
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.
(f-1) (Blank).
(g) This subsection (g) 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
(f), the System shall exclude salary increases paid to
teachers under contracts or collective bargaining agreements
entered into, amended, or renewed before June 1, 2005.
When assessing payment for any amount due under subsection
(f), the System shall exclude salary increases paid to a
teacher at a time when the teacher is 10 or more years from
retirement eligibility under Section 16-132 or 16-133.2.
When assessing payment for any amount due under subsection
(f), the System shall exclude salary increases resulting from
overload work, including summer school, when the school
district has certified to the System, and the System has
approved the certification, that (i) the overload work is for
the sole purpose of classroom instruction in excess of the
standard number of classes for a full-time teacher in a school
district during a school year and (ii) the salary increases
are equal to or less than the rate of pay for classroom

HB5851 - 58 - LRB103 40703 RPS 73498 b
instruction computed on the teacher's current salary and work
schedule.
When assessing payment for any amount due under subsection
(f), the System shall exclude a salary increase resulting from
a promotion (i) for which the employee is required to hold a
certificate or supervisory endorsement issued by the State
Teacher Certification Board that is a different certification
or supervisory endorsement than is required for the teacher's
previous position and (ii) to a position that has existed and
been filled by a member for no less than one complete academic
year and the salary increase from the promotion is an increase
that results in an amount no greater than the lesser of the
average salary paid for other similar positions in the
district requiring the same certification or the amount
stipulated in the collective bargaining agreement for a
similar position requiring the same certification.
When assessing payment for any amount due under subsection
(f), the System shall exclude any payment to the teacher from
the State of Illinois or the State Board of Education over
which the employer does not have discretion, notwithstanding
that the payment is included in the computation of final
average salary.
(g-5) When assessing payment for any amount due under
subsection (f), the System shall exclude salary increases
resulting from overload or stipend work performed in a school
year subsequent to a school year in which the employer was

HB5851 - 59 - LRB103 40703 RPS 73498 b
unable to offer or allow to be conducted overload or stipend
work due to an emergency declaration limiting such activities.
(g-10) When assessing payment for any amount due under
subsection (f), the System shall exclude salary increases
resulting from increased instructional time that exceeded the
instructional time required during the 2019-2020 school year.
(g-15) When assessing payment for any amount due under
subsection (f), the System shall exclude salary increases
resulting from teaching summer school on or after May 1, 2021
and before September 15, 2022.
(g-20) When assessing payment for any amount due under
subsection (f), the System shall exclude salary increases
necessary to bring a school board in compliance with Public
Act 101-443 or this amendatory Act of the 103rd General
Assembly.
(h) When assessing payment for any amount due under
subsection (f), the System shall exclude any salary increase
described in subsection (g) 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.
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 (f) of this Section.
(i) The System shall prepare a report and file copies of

HB5851 - 60 - LRB103 40703 RPS 73498 b
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
resulting from the changes made to this Section by Public
Act 94-1057.
(i-5) For school years beginning on or after July 1, 2017,
if the amount of a participant's salary for any school year
exceeds the amount of the salary set for the Governor, 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
salary in excess of the amount of the salary set for the
Governor. This amount shall be computed by the System on the

HB5851 - 61 - LRB103 40703 RPS 73498 b
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 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. 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
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.
(j) For purposes of determining the required State

HB5851 - 62 - LRB103 40703 RPS 73498 b
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.
This subsection is inoperative on and after July 1, 2034.
(k) 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. 102-16, eff. 6-17-21; 102-525, eff. 8-20-21;
102-558, eff. 8-20-21; 102-813, eff. 5-13-22; 103-515, eff.
8-11-23.)
(40 ILCS 5/18-131) (from Ch. 108 1/2, par. 18-131)
Sec. 18-131. Financing; employer contributions.
(a) The State of Illinois shall make contributions to this
System by appropriations of the amounts which, together with
the contributions of participants, net earnings on
investments, and other income, will meet the costs of

HB5851 - 63 - LRB103 40703 RPS 73498 b
maintaining and administering this System on a 100% 90% funded
basis by the end of State fiscal year 2048 in accordance with
actuarial recommendations.
(b) 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 prescribed rate of interest, using the formula
in subsection (c). In making its determination, the Board
shall disregard any contributions scheduled to be received in
a future State fiscal year under the Budget Stabilization Act.
(c) Beginning in State fiscal year 2049, the minimum
contribution to the System to be made by the State for each
State fiscal year shall be the contribution amount for the
upcoming State fiscal year estimated in the previous year's
actuarial valuation required by Section 18-140 plus the
amounts required under subsection (c-5), such that the total
assets of the System equal 100% of the total actuarial
liabilities of the System 20 years after the State fiscal year
during which the contribution is made. The required State
contribution shall be determined under the entry age normal
actuarial cost method.
For State fiscal years 2035 through 2048, the minimum
contribution to the System to be made by the State for each
State fiscal year shall be the contribution amount for the
upcoming State fiscal year estimated in the previous year's
actuarial valuation required by Section 18-140 plus the

HB5851 - 64 - LRB103 40703 RPS 73498 b
amounts required under subsection (c-5), such that the total
assets of the System equal 100% of the total actuarial
liabilities of the System 20 years after the State fiscal year
during which the contribution is made. 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 2048 and shall be
determined under the projected unit credit actuarial cost
method.
For State fiscal years 2026 through 2034, the minimum
contribution to the System to be made by the State for each
State fiscal year shall be an amount determined by the System
to be sufficient to bring the total assets of the System up to
100% of the total actuarial liabilities of the System by the
end of State fiscal year 2048. 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 2048 and shall be determined under
the projected unit credit actuarial cost method.
For State fiscal years 2012 through 2025 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% of
the total actuarial liabilities of the System by the end of
State fiscal year 2045. In making these determinations, the
required State contribution shall be calculated each year as a

HB5851 - 65 - LRB103 40703 RPS 73498 b
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.
A change in an actuarial or investment assumption that
increases or decreases the required State contribution and
first applies in State fiscal year 2018 and before State
fiscal year 2035 or thereafter shall be implemented in equal
annual amounts over a 5-year period beginning in the State
fiscal year in which the actuarial 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
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

HB5851 - 66 - LRB103 40703 RPS 73498 b
increments so that by State fiscal year 2011, the State is
contributing at the rate required under this Section.
Notwithstanding any other provision of this Article, the
total required State contribution for State fiscal year 2006
is $29,189,400.
Notwithstanding any other provision of this Article, the
total required State contribution for State fiscal year 2007
is $35,236,800.
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
State is contributing at the rate otherwise required under
this Section.
Notwithstanding any other provision of this Article, the
total required State contribution for State fiscal year 2010
is $78,832,000 and shall be made from the proceeds of bonds
sold in fiscal year 2010 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 2010, and (iii) any reduction in bond
proceeds due to the issuance of discounted bonds, if
applicable.
Notwithstanding any other provision of this Article, the

HB5851 - 67 - LRB103 40703 RPS 73498 b
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 18-140 and shall be made from the
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.
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.
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.

HB5851 - 68 - LRB103 40703 RPS 73498 b
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
calculated under this Section and certified under Section
18-140, 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
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
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.
(c-5) For State fiscal year 2035 and each State fiscal

HB5851 - 69 - LRB103 40703 RPS 73498 b
year thereafter, the contribution to the System to be made by
the State shall include an adjustment for differences between
the unfunded liability reported in the current actuarial
valuation and the unfunded liability reported in the previous
year's actuarial valuation required by Section 18-140. The
adjustment shall be implemented in equal annual amounts over a
20-year period beginning in the State fiscal year in which the
current actuarial valuation is used to determine the required
State contribution under subsection (e).
(d) 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.
This subsection is inoperative on and after July 1, 2034.
(e) 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.

HB5851 - 70 - LRB103 40703 RPS 73498 b
(Source: P.A. 100-23, eff. 7-6-17.)
(40 ILCS 5/1-103.3 rep.)
Section 15. The Illinois Pension Code is amended by
repealing Section 1-103.3.