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SPRINGFIELD — A final pension reform law is a long way off, and roadblocks still exist, but Illinois’ path to controlling its $130 billion pension debt is becoming clearer.

By Benjamin Yount

SPRINGFIELD — A final pension reform law is a long way off, and roadblocks still exist, but Illinois’ path to controlling its $130 billion pension debt is becoming clearer.

The Illinois House today approved measures to cap the salary — $113,000 — on which a pension can be based, and to steadily raise the retirement age — to 67 for some public employees.

More important, according to state Rep. Elaine Nekritz, D-Northbrooke, lawmakers are finally showing their cards in regard to what they will and will not support.

“This process is highlighting and narrowing the kinds of things we can consider as part of a comprehensive package,” Nekritz said.

Illinois lawmakers have long talked about the need for pension reform, but until this spring rank and file legislators have taken few votes on the issue.

Nekritz said the approach “where leaders come together with a solution” and hand it off to lawmakers has produced nothing.

“It really is important that we try and do something different, and find out what members will support,” Nekritz said.

Lawmakers have supported limits on the amount public workers will earn with their pensions and generally support the idea that public employees will have to pay more for their retirement benefits.

But the Illinois House has voted down a plan that would freeze or eliminate cost-of-living adjustments for pensioners as well as proposals that would have had teachers, university workers, prison guards and state troopers pay 4 percent more toward their retirements.

Each plan has gotten its own vote over the past few weeks. Powerful Democratic House Speaker Mike Madigan has said he orchestrated the votes to “educate” lawmakers on the complexity of pension reform.

House Republican Leader Tom Cross has been critical of the process.

“This is legislating by multiple choice,” Cross declared on the House floor.

Cross’ Republican caucus boycotted many of the pension votes out of anger over “politics,” the GOP leader has said.

“Many of these people have never been pinned down on these issues before,” said University of Illinois at Springfield political science professor Chris Mooney. “That’s why you see so many votes.”

Mooney said lawmakers are being tested.

“If you won’t support a 3 percent pension increase, what about 2 percent? What about COLA’s?”

Nekritz said the goal is a “comprehensive package” on pension reform, and not a hodge-podge of ideas.

The comprehensive plan Nekritz and Cross — along with state Sen. Dan Biss, D-Evanston — are shepherding through the Capitol passed a statehouse committee Thursday. It could come before the House any day.

But while the House is acting on pension reform, the Illinois Senate is moving ahead with a number of different yet sweeping proposals.

A proposal from Senate President John Cullerton, D-Chicago, giving public employees a choice between higher pension contributions or lower benefit levels, passed a Senate panel Wednesday.

Cullerton insists the choice component of his plan is the only way Illinois can reform its five pension systems and not run afoul of constitutional protections.

John Cameron is legislative director for the American Federation of State, County, and Municipal Employees. Any pension reform that lacks union blessings would be unconstitutional, he says.

“We believe that the best approach to get to constitutionality is by negotiating,.” Cameron said. “Taking another approach than imposing reductions.”

But lawmakers in both the House and the Senate do not appear willing to bargain over pension reform.

Mooney thinks pension reform will have to be hammered out — one piece and one vote at a time.

“Maybe the bargaining lawmakers did in the backroom for years is finally being done out in public.”

Contact Benjamin Yount at Ben@ILWatchdog.org

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6 Comments

  1. Pension reform

    I paid for health insurance .05% (the state matched the .05% for health insurance) and COLA .05% out of every paycheck for 34 years.  Why would I choose 1 of the 2 when I already paid for and earned both?  .15% times lifetime earnings, plus interest, figures out to be alot of health insurance and COLA.  Its a simple math problem, 34Xaverage yearly wageX.15 plus interest over 34 years = payment for health insurance and COLA.  I think its naive of Mr. Cullerton to think that he can negotiate with my COLA and health insurance when I have already paid and earned both.  I have receipts for both purchases.  Unconstitutional.  Only SB2404 or HB3162 are constitutional.

     

  2. The pension system is unsustainable and full of waste and fraud

    I think the Illinois citizenry have had enough of this never-ending government union pension mess.

    Democrats borrow billions to keep paying for the unsustainable government union pensions. Then Democrats, and only Democrats, passed a 67 percent tax increase after unionistas marched on Springfield, demanding a tax hike.

    Still our state is in the worst fiscal condition in the nation. Democrat lawmakers like Daniel Biss want to kick the pension problem down to local school districts, which will shock their budgets and cause local taxes to skyrocket.

    What is happening in Illinois is happening in Europe. There is no money left to keep the unsustainable jackpot pensions floating. The Ponzi scheme is up. The government union pension system is rife with abuse from double dipping to paying for the election of pro-union politicians.

    Our last police and fire chiefs retired in their early 50s and are getting a six figure annual pension, guaranteed 3 percent annual pay raise and nearly cost-free healthcare for the rest of their lives. And guess what, these two men are working full-time as police and fire chiefs in neighboring towns, earning another six figure salary and they will get another pension.

    Does anyone wonder why 90 percent of all union campaign donations go to Democrat politicians?

  3. Simple math problem

    Dave,

    I agree that this is a simple math problem.  However, the trick is recovering the 90-some billion dollars that the state has failed to supply for the pension system.  You held up your end, but now we've got to get the state to make up for decades of pushing the can down the road.  We'll see what the legislature can swallow, and there may be a bill that passes which is later overturned in the courts, or at least certain elements.  I am a current employee of IL public schools, and am willing to work longer and pay slightly more for the defined benefit plan that currently exists.  I don't think anyone can change the contract that was established for current retirees, however.  As you said it's unconstitutional.  It's just too bad that we are in this mess because of the decades of limited funding from the state of IL.

  4. A big improvement if—

    Pensions collected should be based on years served out of a 'normal' life cycle of work, eg. from 24 to 65.

    If you retrie early it would be based on the fraction of that period you worked, e.g. if from 24 to 50 then

    (50-24)/(65-24) * benefit [probably on basis of a non-linear curve with 'benefit' amount increasing by years.

    Then if someone wants to move, change jobs, etc. they collect a portion not 'whole' amount.

    Anyone, banker, policeman, fireman, teacher, etc. must realized jobs don't last forever.  Thus they should prepare just like football players plan [should] and prepare for business, law, teaching, coaching, etc…

  5. Embarrassement at the hands of the Left

    The state of IL is just an embarrassment. 

    Our elected officials at the local and state level have failed us.

    And our state is a blue state.  And our state has been mismanaged by Democrats in power for decades.

    Perhaps us and California are the harbingers of what happens when liberals and Democrats are in charge.

    Even more embarrassing is that our President, King Obama, is from the state of Illinois.

    Let's just see what continues to happen when this Liberal Democrat, from IL, continues to wreck our country and demonize and divide our people.

    See, no one on the left wants to fix problems.

    All they want to do is afix blame.  It is never the liberal's fault.   

    Well take a look around you, you local Democrats.  Your party in control, your state that is an absolute turmoil, and your country that is weakening by the day.

    Take your war on women, your war on the wealthy (and yes you rich NE Evanston hypocrites), take your war on whomever, what group, what class of people who disagree with you and shove it.

    Stop dividing and fix the problems.

    I am embarrassed.

  6. more money is needed

    there is one thing all of these proposals to fix the pensions have overlooked .  how to deal with the $97 billion debt that is owed to the system.  oh and then there is the little matter of the $10 billion in unpaid bills.  there are really only two ways to deal with this issue.  one way is toforce current state employees and retirees to take less benefits than they agreed to by cramming a deal down their throats and throwing out part of our state constitution.  the second way is to simply bite the bullet and raise taxes.  i suupose there is a third way :  a federal bailout, but i don't know how the other 49 states would feel about paying for our problem.  perhaps we could arrange for a federal loan  that could be forgiven some time in the future when no one is payin attention.

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