State closer to pension reform?

Lawmakers in Springfield are going to be back at it again tomorrow, trying to sell a plan designed to fix Illinois’ broken pension system.

The plan put forth has bi-partisan support. Those against it say the plan is not constitutional.

Lawmakers sponsoring this latest bill say the ideas represent the wave of the future and make it harder to retire and requiring teachers and other state workers to give more with every paycheck.

The stacked hybrid plan is supposed to dig Illinois out of the $96 billion hole that’s been getting deeper over the years. 30 plus sponsors in the House so far, but is it enough?

Suburban and downstate teachers, as well as state workers hope it’s not.

Some details include:

For salary caps:

  • Cost-of-living adjustments apply only to the first $25,000 of the employees` pension
  • Retirement age increases 1-5 years depending on your current age
  • Employees would be required to contribute 2%  more toward their pensions

The newest component is new employees would contribute 4% of their salaries toward a 401-style plan for university workers and teachers who start work after Jan. 1, 2014.  This puts the burden of funding these new employee plans on local school districts and universities rather than on the state.

Whatever is passed under the capitol dome in the coming days will most likely end up in the courts.  The bill’s constitutionality is what’s being questioned.

The pension debate gets picked up again on the house floor tomorrow.

9 comments

  • Frank

    Pass the pension burden to the local districts. Then our property taxes go up even higher than they are now.

    Do away with the pensions all together. Those of us who work in the private sector have to take responsibility to save for our own retirement in the form of a 401k because pensions are too expensive for corporations. If the pensions get to expensive for the public sector they just raise our taxes.

  • Kristin

    Frank, the state borrowed money out of the pensions and never put it back. If the state had never done this in the first place then we would not be in the position that we are in now.

  • Carl

    How can politicians propose that, since we voted to not pay our obligations to the public pension system in the past, which resulted in this backlog of money owed, the answer is to reduce our payment obligations in the future? Woudn't we love to present this idea to the bank that holds our mortgage? Guess what people, the politicians are starting to pound the drums, saying that, even though you paid the taxes for your social security, it is just an entitllement program, which they can cut as they see fit. Since you did not earn it, they feel they can lower the payouts as they deem fit. Watch out for the degree to which you are sucked in to this "divide and conquer" sham they are presenting because you will be next.

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