Topics & Report

              topics &
r e port
Executive Director’s Message
Teachers’ Retirement System of the State of Illinois
Summer 2008
Director’s message continued on page 2
Budget continued on page 2
State Pension Debt Misconception,
Rezko Trial Concludes
The state of Illinois has the dubious distinction of hav-ing
the largest amount of pension debt in the nation, of
which $22 billion is the Teachers’ Retirement System’s
share. TRS members undoubtedly read and heard news
coverage about this issue in recent weeks following a series published
by the Illinois Associated Press that highlighted the problem. The state’s
unfunded pension liability is often inaccurately described as a product of
overly generous benefits. In the case of TRS, this is a widely-held fallacy.
The primary reason the Teachers’ Retirement System lacks the assets nec-essary
to cover its accrued benefits is due to decades of insufficient state
funding. In fact, actuarial studies show that had the state properly funded
TRS since 1980, the retirement system would be 98 percent funded today,
instead of the current 64 percent.
Active TRS members pay 9.4 percent of their creditable earnings into TRS
or their school district pays that contribution on their behalf. That contri-bution
rate is among the highest in the nation for public teacher pension
Retirement Security for Illinois Educators
TRS Funding Protection Remains Intact for Fiscal Year 2009
The General Assembly adjourned on May 31 after passing House Bill 5701, as amended, that contains the pension
appropriations for the fiscal year 2009 budget. The new fiscal year begins on July 1.
House Bill 5701 provides state appropriations for TRS in the amount of $1,196,488,000, or approximately
$255,301,000 less than the amount the TRS Board of Trustees certified as the required amount under the 50-year
funding plan.
However, the continuing appropriations language remains intact within the law. This language provides TRS
with the authority to obtain its certified amount automatically for fiscal year 2009. In effect, this means that the
General Assembly agrees to fund the certified amount for fiscal year 2009. The only way to change the continuing
appropriation language is through a super majority vote of the General Assembly, and TRS does not anticipate
such a vote.
Also, the legislation provides for the Board certified amount of $75,474,000 for the Teachers’ Retirement Health
Insurance program (TRIP).
Highlights
Page 3
• Online Security Increases
• PDP Ends June 30, 2010
• Board Information
Page 4
• Post-retirement Limitations
• Survivor Benefit Steps
Page 5
• Fall Member Meetings
Page 6
• Viars’ Retirements
Page 7
• TRS Promotion and Hires
Page 8
• Watch Member Videos Online