School Funding Legislation Provides State Pension Contribution to CTPF
On Thursday, August 31, 2017, Governor Rauner signed Senate Bill 1947 into law. The bill was passed earlier this week by both the Illinois House and Illinois Senate. This legislation makes changes to Illinois’ school funding formula, and requires the State to pay the long-sought normal cost of Chicago teachers’ pensions.
The legislation has three main components which impact CTPF:
- Beginning with the 2017 tax year, the City of Chicago’s Board of Education may impose a dedicated property tax levy of up to 0.567% (the current property tax levy rate is capped at 0.383%). This increase, if implemented, will generate additional revenue which will go directly to the Fund.
- Starting this fiscal year (July 1, 2017-June 30, 2018), the State will pay CTPF the normal cost of Chicago teachers’ pensions and retiree health insurance costs. Beginning in Fiscal Year 2019, CTPF will provide a certified normal cost to the State on an annual basis which will include the $65 million authorized for the retiree health insurance subsidy.
- The legislation also provides a continuing appropriation for all amounts contributed by the State to CTPF.
“This legislation offers stable and equitable State funding for CTPF and provides Chicago’s Board of Education with additional resources. We appreciate the hard work and cooperation that made this possible,” said Charles A. Burbridge, CTPF Executive Director. “The State has paid the normal cost of downstate/suburban teacher pensions, and this legislation ensures that teachers are treated equitably throughout the State. We want to thank our members who have spent more than a decade educating legislators about the importance of fully funding pensions and, as a result, education in Illinois.”