SR0083 97TH GENERAL ASSEMBLY

SR0083 LRB097 11003 JDS 51746 r

SENATE RESOLUTION

WHEREAS, The Illinois public pension systems are estimated to have an unfunded liability of $80 billion, and the State's contribution to those systems is expected to be $22 billion in fiscal year 2045; and

WHEREAS, The Pew Center issued a study on state pensions, titled "The Trillion Dollar Gap", which reported that Illinois has the worst funded pension systems in the nation; and

WHEREAS, Over the years, the Illinois pension systems have used questionable accounting and investment practices; and

WHEREAS, The State of Illinois is facing an unprecedented funding shortfall in all of its pension systems and is commonly considered the worst funded public pension systems among the 50 states; and

WHEREAS, Former Governor Rod Blagojevich was indicted for corruption involving official actions pertaining to the Teachers' Retirement System of the State of Illinois; and

WHEREAS, State law provides limits on Freedom of Information Act requests for pension data that limit the transparency of the pension systems of the State of Illinois; and

WHEREAS, It was recently made public that the U.S. Securities and Exchange Commission has opened an inquiry into the reporting of potential pension reform savings by the pension systems; and

WHEREAS, The inquiry has raised questions about investment decisions, investment returns, and accounting techniques that warrant an audit of the pension systems; therefore, be it

RESOLVED, BY THE SENATE OF THE NINETY-SEVENTH GENERAL ASSEMBLY OF THE STATE OF ILLINOIS, that we urge the Commission on Government Forecasting and Accountability to competitively bid for an auditing firm to conduct an audit of the State Employee's Retirement System of Illinois, the Judges Retirement System of Illinois, the General Assembly Retirement System, the State Universities Retirement System, and the Teachers' Retirement System of the State of Illinois; and be it further

RESOLVED, That the firm shall look into all processes of the systems, including examining contracts awarded, investment decisions, investment returns, investment fees, trading commissions, accounting techniques, and any other processes related to the management of the funds; and be it further

RESOLVED, That the Commission on Government Forecasting and Accountability report within one year after the adoption of this resolution to the General Assembly and Governor, and publish on its website, all findings, including recommendations on how each system can improve efficiency and any finding of suspected corruption; and be it further

RESOLVED, That the pension systems involved fully cooperate and turn over any materials requested by the auditing firm; and be it further

RESOLVED, That the Commission on Government Forecasting and Accountability begin the process of selecting an auditing firm as soon as possible after the adoption of this resolution so that an initial discovery audit will be made available within 2 months to the Commission on Government Forecasting and Accountability and the public; and be it further

RESOLVED, That the Commission on Government Forecasting and Accountability report quarterly on the fiscal condition of the pension systems, in particular: the current funding ratio, as projected with and without the use of 5-year asset smoothing; balance of assets; cash on hand; and projected liabilities; and be it further

RESOLVED, That suitable copies of this resolution be delivered to the Executive Director of the Commission on Government Forecasting and Accountability, as well as to the State Employees' Retirement System of Illinois, the Judges Retirement System of Illinois, the General Assembly Retirement System, the State Universities Retirement System, and the Teachers' Retirement System of the State of Illinois.