Sec. 2. Prohibition on use of education funds for excess payments to certain retirement or pension systems
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Subpart 2 of part F of title VIII of the Elementary and Secondary Education Act of 1965 ( 20 U.S.C. 7901 et seq. ) is amended by adding at the end the following: Except as provided under subsection (b), no State receiving funds under this Act may require any local educational agency using funds under this Act to hire or pay the salary of teachers to use such funds to make contributions to a teacher retirement or pension system for a plan year in excess of the normal cost of pension benefits for such plan year for which the employing local educational agency has responsibility. Subsection
(a)shall not apply with respect to a teacher retirement or pension system for a plan year if the system certifies to the Secretary, at such time and in such manner as the Secretary may require, that the system has a funded ratio for such plan year exceeding 50 percent. For purposes of this section: The term normal cost means the portion of the cost of projected benefits allocated to the current plan year, not including any unfunded liabilities the teacher retirement or pension system has accrued. The term funded ratio means, with respect to a teacher retirement or pension system for a plan year, the ratio of— the value of the system’s assets for the plan year (as determined using reasonable actuarial assumptions), to the accrued liability of the system for the plan year (as so determined). . The table of contents in section 2 of such Act is amended by inserting after the item relating to section 8549C, the following: Sec. 8549D. Prohibition on use of education funds for excess payments to certain retirement or pension systems. .
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Sec. 2
Prohibition on use of education funds for excess payments to certain retirement or pension systems
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