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State workers and retirees crowded a meeting room at the Civic Center Thursday evening to object to plans to trim their pensions to deal with the state’s budget crisis.

Herbert Bashir, an Evanston resident and a retired Department of Children and Family Serivces case worker, told State Sen. Daniel Biss and State. Rep. Robyn Gabel of Evanston that workers “are made to feel like retirees are responsible for the problem.”

Biss responded that of the 13 million people in Illinois, “only a few hundred of us” — the state’s legislators — caused the problem.

“But the problems that are the fault of the legislature cannot be solved without having tremendous amounts of pain across the rest of society,” Biss added.

Bashir, and other workers at the meeting suggested raising more taxes.

“Business loopholes — some don’t pay any taxes,” Bashier said. “Look at those instead of us.”

Top: Retiree Herbert Bashir. Above: State Sen. Daniel Biss.

Biss said the legislature is looking to businesses to pay more — that the governor’s new budget proposes raising an additional $500 million by closing corporate tax loopholes.

Others urged adoption of a graduated income tax to raise more revenue — something that would require a constitutional amendment — while arguing that the state constitution bars lawmakers from reducing pensions.

At the town-hall meeting, which drew abou 100 people to the Parasol Room of the Civic Center, Gabel said that whatever else it may do, the legislature can no longer escape making some reductions in pensions for state workers and public school teachers.

“For a long time I really did not want to make any changes to the pension program,” Gabel said, “but over this last year I’ve come to the realization” that the state’s budget problem “is too difficult to leave pensions off the table completely.”

Audience members not happy with prospects for their pensions.

Both said they favored a graduated income tax, but believe the pension issue has to be addressed first.

If not, they suggested, the legislature would have no credibility with voters who have been hit with an income tax rate hike from 3 to 5 percent.

That increase added $7 billion in new revenue to the state’s budget — but still left the state unable to pay its bills and faced — after two rounds of across-the-board cuts to discretionary spending programs — with having to make still more cuts in its $35 billion budget this year.

Robyn Gabel.

Gabel noted that the house has passed three pension reform bills:

  • One would increase the retirement age for workers under 45 years of age.
  • Another would cap the amount of salary on which workers could earn pensions.
  • The third would eliminate cost of living increases on pension payments over $25,000 a year.

Biss said he has had frequent discussions with leaders of public employee unions. “I enjoy those discussions and find them useful and productive,” he said.

But he said the negotiations between top union leaders and top legislsative leaders “have become adversarial and toxic.”

And that, in part, is why he doesn’t believe combining a big package of pension reforms and revenue increases in one bill will work. “That would just make it harder to get anything done,” he said.

The legislature returns to work in Springfield soon, with about eight weeks left in the session to come up with a pension solutions that can win support in both houses.

Bill Smith is the editor and publisher of Evanston Now.

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17 Comments

  1. an amazing attitude…..

    and so……

    Biss responded that of the 13 million people in Illinois, "only a few hundred of us" — the state's legislators — caused the problem.

    "But the problems that are the fault of the legislature cannot be solved without having tremendous amounts of pain across the rest of society," Biss added.

    Therefore, the legislators who never appropriated the money they were duty-bound to pay into the system should feel no guilt other than "feeling bad"?

    and these pensioners, who paid into the system much more than if they were covered by Social Security that is matched by their employers, lest Uncle Sam come down hard, are expected to feel the pain caused by the "few hundred"?

    and then, since the "few hundred", who will not be affected by the deal they are imposing on the State workers, cannot bring themselves to obligate the State to pay back what is owed the pension funds for fear of losing their jobs and pensions, the pensioners are asked to take a major hit including a reduction in the cost of living  that makes Social Security look great.

    By the way, what does he mean when he says: "the rest of society"? Were that the case, every one of us taxpayers would have to now pay into the system what we were to have paid over the past decade or so. Unhappily, not having paid then means paying more now.  That still seems more equitable than asking the pensioners to suffer the cost and the bulk of Bliss' pain.

    Oh yes, as to whether the issue is constitutional or not, the pensioners were docked about 1/2% each time from their paychecks just to cover the COLA that bliss seems ready to reduce to next to nothing.

    It strikes me that both Bliss and Gaybel were auditioning for a part in a play drawn from a Dr Seuss book. Can you guess which book?

    Ironically, the attitude being expressed and the mock tears seems more what one might expect of the "other political party"

     

    1. Where should the money come from?

      Quoting … "cannot bring themselves to obligate the State to pay back what is owed the pension funds for fear of losing their jobs and pensions, the pensioners are asked to take a major hit including a reduction in the cost of living  that makes Social Security look great"

      Take a look at the multi $10 billion underfunding, combined with the fact that Ill. tax rate are already one of the highest in the nation, where would you like the official to find the money to pay it back ?

      And just to put things in the proper perspective, if the typical public sector worker accumulated all of their contributions (Including investment income) to the date of retirement, the accumulated sum would rarely be sufficient to buy more than 10% of the promised pension.  Taxpayer contributions (and the interest on taxpayer contributions …. interest that would have stayed in the taxpayer's pocket in the absence of these very generous pensions) are responsible for the 80-90% balance.

      So yes, you have paid the portion allocated to you … but not a "fair share."

      All but the very smallest pensions ($25K after a full 30+ year career of full-time work) should be cut by at least 50% ….. and they would still be greater than the pensions of 90% of their private sector counterparts.

      1. You seem to feel that

        You seem to feel that accumulating all the payments made would not amount to 10% of the promised pension.  Have you checked your Social Security lately and calculated what percentage of your promised pension  you paid in?

        These are all shell games and were, including Social Security, based on a very different life-span, payments being made by high-salaried employees (not being capped) and a greater number of people paying into the systems.

        At least, Social Security forces employers to make payments equal to that of the workers. bliss and his present and former colleagues and their predecessors operated as if any obligation can be ignored unless, figuratively, a gun is held to their collective heads.

        Finally, I suspect, while you are cutting pensions by half, in your last sentence, you are still assuming that there is social Security to fall back on. Most State and Federal employees do not qualify nor will they receive Social Security. those that do or might, get theirs reduced based on the fact they are getting another pension. Private sector folks usually get both in toto.

        1. Federal employees

          Since around 1986, federal employees pay into Social Seciurity at the same rate as the ordinary citizen because of the reitirement system called FERS; the ugly step-child of CSRS. Almost a third of their reitirement is based on SS. A very small annuity that they paid into their entire career is paid but the majority of their retirment is the gubmint equivilent of a 401(k); Thrift Savings Program or TSP. Look it some time. You find it interesting.

          1. And I Bet…

            The Federal government actually pays the matching employer portion into Social Security/pension system.

            Illinois does not.

  2. The taxpayer-fund share

    The taxpayer-fund share of all public sector pensions should (when expressed as a % of pay) not be greater than the pensions afforded reasonably comparable private sector workers.

    Right now, becuase of the very rich pension formua factors (per year of service), the young full retirement ages, the post-retirement COLAs, and the very liberal definition of "pensionable compensation", public sector pensions are routinely 2, 4, (even 5+ times for safety workers) greater in value at retimement that those of their private sector counterparts….. and these piggish unions/workers even refuse to reform this excess prospectively — for future service.

    Not only must we reform it for future service, but the excesses having been obtained by the public sector unions bribing our elected representatives with campaign contributions and election support, justifies elimininating that excess for past service as well.

  3. Union members

    Sorry, state workers, pensioners, are absolutely at fault here.  They "own" their union and therefore they have responsibility in the actions that the unions take on their behalf.  For decades this farce has been going on and never once has any union rank and file member stood up and demanded change in the way their pensions were handled, not once, not ever. 

    Union leadership would occasionaly make some empty rhetoric remark about the state not paying up but not once, not ever, have they proposed reformatting the system to one that was beneficial to their members. 

    Instead the union leadership, with no demands made upon them by rank and file, continued the cozy skimming operation perpetrated by them and the Dem politicians, for their own benefit, knowing full well the long term probable repercussions to members.

    The fact that union members have never stood up for their own interest makes them absolutely culpable.  Anyone foolish enough to have allowed such a situtation to continue for decades deserves to have to pay the price for their lack of oversight into how their very own money and retirement was handled. 

    Still to this day, no demands from union membership for change and that is just stupid.

    1. Union, what union?

      Anonymous, you assume, very very incorrectly, that all state workers are unionized and that union leaders are the cause of the problem we now face.

      Many state workers are not unionized. The bulk of university profs and other staff do not belong to any union. They have no collective bargaining agreements and their salaries are based on whatever pay schedule the university, the college or the department chooses. In many instances, the teachers have no say as to number of courses, number of students per course, etc, and at entry levels they get very little for their efforts while simultaneously having to do research and publish lest they be tossed out within 3-6 years. Have you ever read what part-timers get paid and they have no benefits.

      In theory,  they are compensated on the basis of "merit", which you should laud since it means, contrary to many of the local schools, i.e., Dist 202 and Dist 65, where all teachers are union and get about the same salary regardless of competence or quality, with increases coming from longevity.

      This of course, raises the question as to why the state and not the district should be paying the "employer's share" of the local school pension. On this one, ironincally, it is the GOP that seems to want to protect the districts and voters and not transfer the cost to the school district, wheras the same Dems that have been in cahoots with those evil unions you chastice want to avoid passing the burden to the local district.  Why? Ask quinn who bought his last election victory by promising wage increases even while knowing we had this problem

      Of course, if we as local taxpayers suddenyl had to pay for our teacher's pensions, would we not have insisted on eliminating golden parachutes, multiple superintendents and principals (how many do we have here in Evanston), and other deals

      As long as it did not hurt you or others, you accepted these deeals even if you were not union or an employee of the state, distric or school. Only fear of paying has made taxpayers become responsible.

      But as to unions, they may not always have anything but their membership's interest, but as noted, many of those now taking the hit never belonged to unions got underpaid as a result on the prmeise that, at least, they might get a decwent pension after being underpaid.

      Ask a prof at Illinois or any other state school what they get paid and then ask a comparable prof at Northwestern or Chicago, and you will find that the public has been getting a very good deal for a long time. Had the non-union public teachers been paid more, they might have had worse pensions, but you and others would have paid lots more for tioution, fees and the educations of your kids and those of your friends and relatives. 

      1. Union members deserve blame

        Truth ferret, here is what I assume that is correct.  You may label me as being incorrect but basically 97% of all State workers are unionized, period.  So I'm 97% correct and your 3% correct, truth?

        Not only that but in Illinois the state has been unionizing positions that should not be union.  Supervisors.  How does a departments chief fiscal officer become union, agency directors, chiefs of staffs?

        These are merit compensation employees everywhere else, the "bosses" who have a direct conflict of interest in belonging to a union.  That means the 3% is also shrinking towards 2% being non union.

        As for your asking a prof at a state school what they get paid and then ask a comparable prof at NU what they get paid?  Why?   if you don't like the pay at a state school, go to a private university, otherwise live by your choice of working where you work.  If you cannot get placed at the private university there may be a reason for that, and quite possibly real justification for the lower pay scale.   

        The states 97% Union membership has nobody to blame but themselves for their complete lack of fiscal oversight and are therefore primarily culpable for the predictable situtation they are in and should pay the price for their total lack of intervention. 

        They have no one to blame but themselves for allowing both their union representatives and the Democrat politicians they supported for putting them into this situation. A situtation developed over decades of time with absolutely no member demands for restructuring.

        If I don't pay attention to what is happening with my very own money then I have nobody to blame but my very own self. 

  4. My fingers got ahead of my

    My fingers got ahead of my brain, where that 10% was supposed to be 10-20% (the complment of the 80-90% refereced later).  And it's not a "feeling",  it's fact.  Go ahead test it.  Do the calculation for your pension, then use one of the online annuity calculators to see what lunp sum they would require to pay your promised auunity (but remember to make it a COLA-adjusted annuity), and you'll see that my statement is accurate.

    And your statement suggesting a similar result for Social Security is patently false.  For ANYONE other than the lowest paid workers SS isn't a greart deal with the workers paying only 10-20% of what they get, It's a rotten deal, where you get back little more than you put in with almost no earnings at all.  The Public Sector Unions KNEW THIS. That's why, many years ago they opted out.

    And more false statements …. At the salary level of almost all FED and State workers, SS is a bad deal.  So you had the 6.4% extra in your paycheck that private sector workers didn't.  You should have saved it, and if you didn't , as a source of funds to "fall back on" , that's your problem, not ours.

    And as far as SS reductions. SS calls them "Windfall Elimination" provisions for a good reason.  They are there … NOT to penalize you … but to PREVENT you from realizing an UNJUST "windfall". It's clearlyt described as such on the SS website.

    I suggest you start saving doube-time.  The winds of change are coming and the taxpayers are going to pull the plug on the financial rapethat  the Public Sector Unions & workers have been perprtrating upon the taxpayers for the past 2 decades.

  5. Pension mess

    Biss and Gabel are new to the issue.  They weren't around when the legislature decided not to fund pension obligations.  They were also not there when funding was made by borrowing (bonds)!  

    However, they are here now and obviously have no idea what they are talking about.  The Illinois Constitution does not allow any changes that have already been proposed so far that affect current workers and retirees.  A complete waste of time is all this is!  Now they are trying to tell their constituents that "we are doing something" to help this issue of underfunding.  

    Yes the problem is underfunding…right?  If State politicians were really trying to do something, other than get re-elected (see the posturing from the above two), they would address the lack of money that Illinois takes in compared to the amout it has to spend by law!

    Revenue reform is what is needed here!  Increase the sales tax base to services and eliiminate breaks for large corporations who pay no state income tax.  If we had enough revenue already…why did the income tax increase not solve the backlog of 10 billion is unpaid State bills?  Why didn't the income tax increase not solve the entire pension funding deficit?  I'll tell you why..because it was 20 years too late to be passed and not large enough to make up for decades of lost revenue!

    Demonizing current employees and retirees who paid what they were told to pay into their retirement system is a strategy of divisiveness and will not solve this issue.  The State must pay for all of this by law!  Every resident of Illinois benefitted from a low income tax for years and now it is time to pay for all the good times that we all have had. Illinois must pay up.  

    Get real and understand who is to blame….all of us!

    1. You sound like you’re a

      You sound like you're a Public Sector workers with a HUGE sense of entitlement.

      How abourt a compromise … we raise revenue (i.e., TAXES) but only AFTER your pensions are reduced (as a % of pay) to the average pension of the taxpayers who you want to pay more.  Deal ?

      P.S….. your pensions would have to be REDUCED somewhere between 50% and 75% to reach that Public/Private Sector pension equality.

    2. You really are to blame

      You and every other union member is to blame, your apathy these past decades over your very own finances means you are primarily responsible for the situation you are now in and you deserve to suffer the consequences your complete and total lack of personal repsonsibility and intervention has caused.

      Illinois has not benefited from some low tax rate, our overall tax burden is on the higher end of the national range overall.  Your calls to increase everybodys taxes to cover your apathy and greed is unacceptable.  As I previously posted below.

      The states 97% Union membership has nobody to blame but themselves for their complete lack of fiscal oversight and are therefore primarily culpable for the predictable situtation they are in and should pay the price for their total lack of intervention.

      They have no one to blame but themselves for allowing both their union representatives and the Democrat politicians they supported for putting them into this situation. A predictable situtation developed over decades of time with absolutely no member demands for restructuring.

      If I don't pay attention to what is happening with my very own money then I have nobody to blame but my very own self.

      1. You really are to blame II

        You let your  elected officials squander money on services and property. Instead of paying your debt, the money went elswhere.

        If I let my personal debts run up, I would be expected to pay them. Instead, you want the people to which the money is owed, pay off your debt.

        Pay your bill!

        1. Graft

          Graft, n. the acquisition of money, gain or advantage by unfair means, especially through the abuse of one's position or influence in politics or business.

          It is not a debt, it is graft and the unions were participants in that graft.  The unions and their members actively and financially supported democrats who in return promised ridiculous outsized pension packages as payment that everybody knew were unfair to the hardworking and overtaxed citizens of this state. 

          Heck, even the dem pols themselves knew the contracts were ridiculous and never even made attempts to fund their intentionally empty promises.  Which should have been a big clue to union members long ago.

          To bad union members did not insist on reasonable and fair pensions with alternative retirement funding plans.  To bad your blind acceptance of those greedy expectations were not realistic.  To bad those of you who had the power to modify the actions of YOUR union, didn't. To bad you not only sat quietly by while the scheme was perpetuated but actively worked and financed those who really benefited from this scheme at both your expense and the taxpayers expense. To bad the birds have now come home to roost.

          Until the pension packages are modified fairly, for both union members and taxpayers, until those packages begin to approach equity with the overwhelming majority of taxpayers in this state, there is no moral obligation for the rest of us to pay for your selfish participation in this basic scheme of graft.

          Unfair pension gains by graft are not a debt.

  6. Pension mess

    Anonymous sounds bitter and angry that private companies have mostly eliminated a defined benefit pension as a part of their compensation package.  Or perhaps he worked for Enron and lost his entire retirement because it had to be invested in Enron stock.  Maybe his company went belly up and the Feds bailed out his pension at a small percentage of what he was owed.  Perhaps he sold his holdings in the panic of 2006/2007 and missed the big rebound in the markets. I feel bad for you!

    However, public sector workers have paid a steep price during the Great Recession.  1,000,000's of them lost their jobs over the last six years due to cuts in every form of government.  Illinois in fact has the lowest amount of State workers per capita. State workers and retirees haven't caused your pain!

    State law requires that these promises be kept.  All the current posturing will not change that fact.  These pensions will be paid by all of us and we had better find a way to accept that truth.  

    Revenue is unfairly acquired by archane, antiquated methods currently used by the State of Illinois.  The State should be paying for educating its residents.  Our incomprehensible dependence on regressive property taxes to fund our education system is wrong!  A flat income tax that is also extremely regressive is also wrong!  These are the issues that we should be discussing.

    Sales taxing of professional servces would be more fair.  Only people who use those type of services would pay the tax.  In lieu of changing the State Constitution to get a graduated income tax, we need to raise the overall rate (again and permanently) while greatly increasing the basic deductions so that low and middle income earners wouldn't be hurt by the change.  Pension income should be subject to the State income tax too.  That money wasn't taxed originally when it was contributed to the pension fund.

    1. Pension mess

      Actually, I take care of my future with planning, and social security plays no part in my planning.  My planning is secure and  unlike you I don't demand undeserved outsized pension benefits be delivered to me while insisting somebody else pay for them.

      I also wrote the graft post below, today Crains lead article was about Bruce Rauner, hopeful IL. gubernatorial candidate who was quoted that the pension system is "fundamentally corrupt" and "broken". 

      He should know, he and his old firm were, are, one of the major beneficiaries of that system, cofounder of Chicagos second largest private equity firm that collected millions in fee's and a flat out massive 20% of all returns generated for the system went directly into their pockets.  An insider who really understands the level of graft.

      Another quote, "When those EXCESS benefits are being paid out to government employees taxpayers lose," and "The system is just crushing the economy and the schools in Illinois." 

      It's Graft of such scale that democratic pols even amended the constitution protecting that graft to help guarantee their continued poltical contribution cash flow.  The constitution needs that  amendment retracted.

      Public employees deserve a pension, taxpayers deserve those pensions to be reasonable, fair and appropriate, and demands for payment into the currently corrupt system are to be ignored until proper adjustments are made.

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