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REGULATION/LEGISLATION

Illinois Senate passes contribution bill for Chicago teachers pension plan

Approval contingent on set of bills, including further pension reform The Illinois Senate on Tuesday passed a bill approving additional state contributions to the $9.5 Chicago Public School Teachers’ Pension & Retirement Fund, totaling $436 million for the next two fiscal years.

The Senate voted 35-22 to approve the package, which would give $215 million to the pension fund in the current fiscal year ending June 30, and $221 million to the pension fund in fiscal year 2018.

Illinois Gov. Bruce Rauner had vetoed a previous bill on Dec. 1 that would have granted that same $215 million additional contribution. The Senate overrode that veto 36-16 and was passed along to the House, which let the veto stand.

The passage of the current bill is dependent on the passage of 11 other bills affecting the state’s fiscal 2018 budget. Four of those 11 bills were also passed by the Senate on Tuesday.

At the time of the previous bill’s passage, Mr. Rauner said he would not sign off on the additional funds without more comprehensive pension reform for the state and local governments. Illinois has been operating without a full budget since July 1, 2015.

Another of the 11 additional bills was a pension reform proposal, which includes an option for certain workers to give up some cost-of-living increases or accept limits on how salary raises will affect their benefits. Consideration of that proposal was postponed until at least Wednesday.

As of June 30, the Chicago teachers’ pension fund had a funded status of 52.4% on an actuarial basis.

The Chicago Public Schools’ fiscal year 2017 budget passed in August relied in part on the additional state contribution to reach its $733 million required employer contribution.