4 days ago
by WGN Web Desk
Governor Pat Quinn says he won’t sign a bill expanding gambling in Illinois until the state fixes its pension mess.
With less than two weeks remaining in the spring legislative session, lawmakers are debating two separate plans to reduce the state’s near $100 billion pension debt by reducing future benefits.
Quinn says, until that work is finished, any talk of adding new casinos or slot machines will have to wait.
05/10/13
by Tom Negovan
The stage is set for a legislative showdown on Illinois pension reform.
The state Senate endorsed a plan to save the state about $50 billion in pension expenses; a House alternative proposed by Speaker Mike Madigan would save three times as much.
The plans differ on issues like retirement age, health care coverage and cost-of-living pension raises.
Now comes the tense job of reconciling two very different plans and finding a compromise that can survive a court challenge.
Governor Pat Quinn would like a final bill on his desk before the General Assembly holds the final session of the current fiscal year on May 31st.
05/09/13
by Tom Negovan
In the state capitol, it’s a battle over two bills, competing proposals brought forward by two of the state’s top democrats to deal with our nearly $100 billion dollar pension problem.
As expected, the senate pension bill passed this afternoon, basically along party lines, 40-16. But that’s not the end of it. The House has already passed a competing proposal, with much deeper cuts.
Some call that bill the solution. Others say it’s a magnet for a lawsuit.
The state house executive committee heard testimony today about the effects of so-called “cost shift;” passing the cost of teacher pensions along to municipalities. It’s part of the pain of dealing with the worst pension crisis in the nation.
There was fiery pension debate in the senate with back and forth between two very different plans, proposed by top democrats. One from the senate president, crafted with union support. And the other proposed by the house speaker which cuts much deeper.
Under the new plan, the choices are variations on Cullerton’s prior proposals that allow employees and retirees to opt between scaled-back 3 percent compounded, automatic, cost-of-living increases and keeping health care in retirement.
Choice A applies to those currently in the pension systems covering teachers outside Chicago, rank-and-file state employees, university workers and legislators. Employees could opt to take 3 percent yearly cost-of-living adjustments based on simple interest and delay the start of those increases until two years after retirement. In return, they would keep access to health insurance, and future pay raises would be counted toward their pension. They also could enroll in an optional cash-balance plan, and teachers would be eligible for an early retirement option.
Choice B offers a couple more options. Employees could keep their current 3 percent compounded annual cost-of-living adjustments, but they would forgo retiree health care and could not count raises toward their pensions. Workers also could choose to keep the status quo in return for waiting three years to start collecting 3 percent compounded pension increases and paying an additional 2 percent from their paychecks phased in over two years.
The choices are different for those already retired and about to retire. They could continue to get health coverage and 3 percent compounded annual pension bumps but would see those increases frozen for two years in a staggered fashion. Under that scenario, they would receive retiree health care. The other option: keep the 3 percent compounded annual hike and give up access to health care.
Other elements of the plan were billed as lessening the ability for unions to bargain over the benefit changes and employee contribution levels. It also would keep pension funding on the current payment schedule.
The Chicago Tribune contributed to this report.
05/09/13
by Tom Negovan
The Illinois Senate is moving quickly to take up one of two proposals to deal with the worst-funded pension program in the entire nation. Illinois’ pension debt is nearly $100 billion.
The Senate plan, proposed by Senate President John Cullerton, passed the Executive Committee yesterday afternoon basically along party lines, on a vote of 10-5 — despite objections by a retired teachers group that the plan as proposed violates a provision of the constitution guaranteeing that pensions, once established, will not be reduced in any way.
Senate President Cullerton told WGN this morning that he is quite convinced what he has proposed will pass a constitutional challenge.
“Anybody can file a lawsuit, but the fact that all of the unions would be supportive of the bill, as opposed to going to court and filing a brief against it, is very helpful,” Cullerton said. “We think that this bill that we have today is very, very certain to withstand legal challenge.”
The Senate is likely to vote today on Senate President Cullerton’s proposal.
House Speaker Michael Madigan’s pension proposal is much different and much more aggressive. Some observers believe Madigan’s plan is more likely to fail a constitutional challenge.
We should learn more today about which proposal advances further in Springfield.
05/09/13
by Nancy Loo
Reporter
The Illinois Senate is expected to vote today on a sweeping pension reform bill.
The Senate Executive Committee endorsed it yesterday as part of an effort to reduce the state’s near-$100 billion pension funding deficit.
Last week the House passed a version that would make even deeper cuts in pension benefits by forcing retirees to choose between paid healthcare and cost-of-living pension raises.
The Illinois Retired Teachers Association says the current benefit levels are constitutionally protected; and if either pension reform bill passes, it’ll take the state to court.
05/08/13
by Tom Negovan
It’s coming to a head in the state capitol: What to do about Illinois pensions and trimming a mountain of debt.
The stage is set for a pension showdown with opposing solutions to the state’s $100 billion dollar dilemma. One plan moved forward in Springfield today. It’s up for a vote before the full senate tomorrow.
The pension plan floated by Senate President John Cullerton passed executive committee this afternoon by a vote of 10 to 5, advancing a measure he says is constitutional and crafted with union participation. Think of it as an alternative to a more ambitious strategy proposed on the other side of the capitol by powerful house speaker Mike Madigan. The Madigan plan, which passed the House last week, would cut much more deeply into Illinois’ unfunded obligations. The concern is it breaks a constitutional promise that established pensions for state workers will not be reduced.
Speaker Madigan’s team charges the senate plan does precious little to cut the state’s $100 billion in pension debt. And while Cullerton says he has the unions on board, today’s committee hearing revealed he doesn’t have all of them. The Retired Teachers Association came out ready to sue.
That group says it will sue the state if this measure becomes law, calling it unconstitutional.
Interestingly less controversial in Springfield is medical marijuana, which passed that same senate committee today, by the same margin, 10 to 5.
05/08/13
by WGN Web Desk
State Capitol in Springfield
The pension deal cut by Illinois Senate President John Cullerton and the state employee unions advanced today, sending the bill to the full Senate for a vote.
The legislation is Cullerton’s latest attempt to pass a pension bill that follows what he believes is a constitutionality sound way to get around promises that retirement benefits would not be reduced once they are established.
“This is the only way around it,” Culleton said.
The bill won approval in the Senate Executive Committee on a 9-5 vote over the protests of the Illinois Retired Teachers Association. The group rejects Cullerton’s belief that the proposal is constitutionally valid because it offers workers and retirees a choice of benefit options.
Bob Pinkerton, the group’s vice president, said the options are basically “either jump off the cliff or I’ll shoot you.”
Pinkerton said his group is prepared to sue the state if the proposal becomes law, saying it would diminish benefits in violation of the constitution.
Chicago Tribune Staff Report
05/07/13
by Tonya Francisco
Reporter
05/07/13
by Tonya Francisco
Reporter
Illinois Senate President John Cullerton has rolled out the latest proposal to fix the state’s pension crisis.
Cullerton, (D)- Chicago, says his new plan is backed by the state employees’ unions and could possibly avoid a legal challenge from the unions.
The proposal would basically allow current employees and retirees to choose between scaled back cost of living increases and whether they would get health care coverage in retirement.
This proposal comes just days after a plan offered by House Speaker Michael Madigan won approval in the House.
Madigan’s plan passed Friday by two votes and requires government employees to contribute more, retire later and cuts cost of living increases.
Cullerton released a statement, calling his plan “the best chance for the General Assembly to pass a clearly constitution proposal that will save money and avoid an expensive and lengthy court battle.”
He added “we must calculate the risk associated with passing a plan that could save zero if the court throws it out. We need to remember that the unilateral approach is a gamble. Betting against the constitution is risky.”
Cullerton says his plan would save about $46 billion, while Madigan’s plan would save about $150 billion. The Senate could begin debate on Cullerton`s plan Tuesday and possibly vote on it by Thursday.
The General Assembly will adjourn in less than four week and the state pension system is underfunded by almost $100 billion and is the worst in the nation.
05/02/13
by WGN Web Desk
In a tight vote, the Illinois House approved Speaker Mike Madigan’s proposed pension reform plan Thursday.
The bill passed 62-51, with two voting present. It needed 60 votes to pass the House. The bill now goes to the Senate, where a similar bill failed earlier this spring.
Madigan’s plan, which was OK’d by a House committee Wednesday, calls for employees to make higher contributions to their pensions.
He proposes eliminating the current 3 percent guaranteed cost-of-living raises in retiree pensions. He also wants to raise the retirement age from 65 to 67.
Union leaders heavily oppose the bill but Madigan says it’s a necessary step if the state is ever going to get a grip on the state’s pension system, which is nearly $100 billion in debt.
05/01/13
by WGN Web Desk
An Illinois House committee has OK’d House Speaker Mike Madigan’s plan to reform the state’s public employee pension system.
Madigan’s plan calls for employees to make higher contributions to their pensions.
He proposes eliminating the current 3 percent guaranteed cost-of-living raises in retiree pensions.
He also wants to raise the retirement age from 65 to 67.
The proposal moves to the floor for a vote but also needs Senate approval.
Union leaders heavily oppose the bill but Madigan says it’s a necessary step if the state is ever going to get a grip on the state’s pension system, which is nearly $100 billion in debt.
A pension deal worked out between Senate President John Cullerton and state employee unions was approved in committee, and now moves on to the full Senate.
A different pension proposal backed by House Speaker Michael Madigan recently passed the Illinois House of Representatives.
The state’s pension system is nearly $100 billion in debt.
