Distributed via Email: March 25, 2010

LEGISLATURE APPROVES PENSION BILL

The Illinois General Assembly approved a bill Wednesday to substantially change the retirement provisions in various State pension systems. The bill will now be sent to the governor for his signature. Some changes could be made to the new pension provisions later this spring with the passage of a follow-up bill.

SB 1946 (Cullerton, D-Chicago) changes provisions of the state pension systems for new hires only. This will not affect anyone currently participating in a state pension system (including the Teachers’ Retirement System), but only those who enter into a pension system after the effective date of the act (Jan. 1, 2011). For TRS, the bill:

• Calculates the final average salary for pension purposes using the highest average of 8 consecutive years during the last 10 years (currently uses 4 years of last 10 years)
• Increases the age to realize full pension benefits to 67 years old with at least 10 years of service credit in the system
• Allows for retirement at age 62 with lower retirement annuity
• Limits the annual average salary for pensionable purposes at $106,800 (indexed to a calculation using the consumer price index)
• Reduces the survivor annuity under certain circumstances
• Reduces the cost of living adjustment

The full bill text can be found at: http://www.ilga.gov/

Though it had been evident for a while that a pension reform bill would be approved this spring, the speed of which this action took place Wednesday surprised many. Orchestrated by House Speaker Michael Madigan (D-Chicago) and Senate President John Cullerton, the provisions emerged as an amendment in the House of Representatives Wednesday morning. By midday, a House committee approved the bill and after a Republican caucus meeting, the full House approved the bill as amended. The shocker was when it became known that the Senate would also deliberate on the bill yet Wednesday night. Indeed, the full Senate approved the bill at about 8:30 Wednesday night.

Though the Senate has 30 days to send the bill to the governor, it is likely that the bill will be "fast-tracked" and the chamber will get the bill to the governor’s desk in a matter of days. Governor Pat Quinn is expected to sign the bill quickly as well. As was reported in last week’s Alliance Legislative Report, the House has already passed a bill to reform the pension system for judges and members of the General Assembly. That bill, HB 6368 (McCarthy, D-Orland Park), is pending in the Senate.

The following bills were approved by the House of Representatives and will be sent to the Senate for further consideration:

HB 4674 (Eddy, R-Hutsonville), an Alliance initiative, provides an alternative method of accommodating transitional needs of students of military families as opposed to the State entering into a binding national "Military Compact".

HB 5515 (Hoffman, D-Collinsville), as amended, provides that, through June 30, 2013, surplus life safety taxes and interest earnings thereon may be transferred to the Operations and Maintenance Fund for building repair work. The bill is supported by the Alliance.

HB 5838 (Burke, D-Chicago), regarding the requirement for automated external defibrillators (AED) at outdoor physical fitness facilities, deletes the provision which requires that if there is no building available near the outdoor facility, the person responsible for supervising the activity must ensure the availability of an AED. The bill is supported by the Alliance.

HB 6041 (Eddy), supported by the Alliance, allows school districts to increase, abate, maintain, abolish, and re-create working cash funds and provides that moneys in the working cash fund may be used by the school board for any and all school purposes.

The following bills were approved by the Senate and will be sent to the House of Representatives for further consideration:

SB 2494 (Meeks, D-Chicago) would establish a voucher system for parents of students in Chicago who attend the lowest performing public K-8 schools. The vouchers could be redeemed at a non-public school, creating a flow of public school funding to non-public schools.

SB 3266 (Lightford, D-Maywood) originally contained a slew of new requirements for school districts regarding comprehensive policies on bullying. The bill was amended to address Alliance concerns and all unfunded mandates were removed from the bill. It now defines bullying and establishes a task force to study the issue further.

As we have reached the half-way point of the legislative session, the General Assembly will be taking a two-week spring break. Both the House of Representatives and Senate will adjourn this week and return to the Capitol on April 13. At that time, House bills will be considered in the Senate and Senate bills will be considered in the House.

This legislative report is written and edited by the lobbyists of the Illinois Association of School Boards to provide information to the members of the organizations that comprise the Illinois Statewide School Management Alliance.

Alliance Legislative Reports are Cosponsored by IASB and:
[ IPA ] [ IASA ] [ IASBO ]

Return to ALR Menu