Annual Report PDF file 2009 - State of Illinois

Note 4PensionsPlan DescriptionAll of the ISBI employees participate in the State Employees’Retirement System (SERS), which is a pension trust fund in theState of Illinois reporting entity. The SERS is a single-employer,defined benefit, public employee retirement system (PERS) inwhich State employees participate, except those covered bythe State Universities, Teachers’, General Assembly, andJudges’ Retirement Systems. The financial position andresults of operations of the SERS for fiscal years 2009 and 2008are included in the State of Illinois’ Comprehensive AnnualFinancial Report (CAFR). The SERS also issues a separateCAFR that may be obtained by writing to the SERS, 2101Veterans Parkway, Springfield, IL 62794-9255 or by calling217/785-7202. The State of Illinois CAFR may be obtained bywriting to the State Comptroller’s Office, Financial ReportingDepartment, 325 West Adams Street, Springfield, IL 62704-1858or by calling 217/782-2053.A summary of SERS’ benefit provisions, changes in benefitprovisions, employee eligibility requirements includingeligibility for vesting, and the authority under which benefitprovisions are established, are included as an integral part ofthe SERS’ CAFR. Also included is a discussion of employer andemployee obligations to contribute, and the authority underwhich those obligations are established.Funding PolicyISBI pays employer retirement contributions based upon anactuarially determined percentage of payroll. For fiscal year2009 and 2008 the employer contribution rates were 21.049%and 16.561%, respectively. ISBI contributions to SERS forfiscal years 2009 and 2008 were $241,690 and $172,154,respectively, and were equal to the required contributions foreach fiscal year.Effective for pay periods beginning after December 31, 1991,the Board opted to pay the employee portion of retirement forISBI employees covered by the State Employees’ RetirementSystems. Generally, this pickup of employee retirement waspart of the budget process and was, in part, a substitute forsalary increases. ISBI contributions to SERS for the employeeportion for fiscal years 2009 and 2008 were $44,104 and$37,225, respectively.with the Department of Central Management Services.Substantially all State employees become eligible for postemploymentbenefits if they eventually become annuitants ofone of the State sponsored pension plans. Health, dental andvision benefits include basic benefits for annuitants under theState’s self-insurance plan and insurance contracts currentlyin force. Annuitants may be required to contribute towardshealth, dental and vision benefits with the amount based onfactors such as date of retirement, years of credited servicewith the State, whether the annuitant is covered by Medicare,and whether the annuitant has chosen a managed health careplan. Annuitants who retired prior to January 1, 1998, and whoare vested in the State Employees’ Retirement System, do notcontribute toward health, dental and vision benefits. Forannuitants who retired on or after January 1, 1998, theannuitant’s contribution amount is reduced five percent foreach year of credited service with the State allowing thoseannuitants with twenty or more years of credited service tonot have to contribute towards health, dental and visionbenefits. Annuitants also receive life insurance coverageequal to the annual salary of the last day of employment untilage 60, at which time the benefits become $5,000.The total cost of the State’s portion of health, dental, visionand life insurance benefits of all members including postemploymenthealth, dental, vision and life insurance benefits,is recognized as an expenditure by the State in the IllinoisComprehensive Annual Financial Report. The State financesthe cost on a pay-as-you-go basis. The total costs incurred forhealth, dental, vision and life insurance benefits are notseparated by department of component unit for annuitants andtheir dependents nor active employees and their dependents.A summary of post-employment benefit provisions, changes inbenefit provisions, employee eligibility requirements includingeligibility for vesting, and the authority under which benefitprovisions are established are included as an integral part ofthe financial statements of the Department of Healthcare andFamily Services. A copy of the financial statements of theDepartment of Healthcare and Family Services may beobtained by writing to the Department of Healthcare andFamily Services, 201 South Grand Ave., Springfield, Illinois62763-3838.Post-retirement BenefitsThe State provides health, dental, and life insurance benefitsfor retirees and their dependents in a program administeredby the Department of Healthcare and Family Services alongILLINOIS STATE BOARD OF INVESTMENT25