Story Summary

Illinois Pension Reform

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.

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A small, bipartisan group of Illinois lawmakers is holding a public hearing in Chicago on the state’s pension crisis.

A conference committee of 10 lawmakers is taking testimony from civic organizations and other groups on how to fix a pension system that’s underfunded by $97 billion.

PensionsOfficials from some of the state’s universities told the committee how the crisis is affecting their schools and offered suggestions on how to fix it.

The hearing comes a week before the General Assembly meets in a special session in hopes of finally passing pension reform.

The Senate and House each passed its own plan.

Governor Quinn called for a conference committee to work out the differences.

A special group of state lawmakers holds their first public meeting today to figure out a way to fix Illinois’ 100 billion dollar pension problem.

The six democrats and four republicans on the conference committee covered mostly old ground today.

They point out $17 million dollars is lost for every day the pension issue isn’t solved.

The panel was created during a special session.

Governor Quinn wants the legislators to hammer-out a compromise bill by July 9th.

The group’s next hearing is scheduled for July 3rd.

In a step toward patching Illinois’ pension deficit, state lawmakers created a conference committee today that will try to deal with the financial mess.

For the Democrats: Senators Dan Biss, Linda Holmes, Kwame Raoul and  Representatives Elaine Nekritz, Arthur Turner, and Mike Zalewski.

For the GOP: Senators Bill Brady, and Matt Murphy and Representatives Darlene Senger and Jil Tracy.

Governor Pat Quinn was unable to secure enough votes in the Senate to pass a House pension plan backed by both Quinn and House Speaker Michael Madigan.

Lawmakers have been trying to fix the state`s colossal pension plan which is growing like Jack`s Beanstalk. Unable to reach a consensus for the past two years, they now say they are closer than ever to working out the details on a patchwork plan that would not exactly fix the problem, but would at least stop the bleeding long enough for a real cure to be found.

Lawmakers in Springfield have been called back into session because they know pension reform is critically needed so the state can meet its financial obligations. But drawing up new pension guidelines is tricky because any redesigned measures have to meet constitutional rules, or the courts will kick them back.

Currently the debt is just over $100 billion.  With $100 billion you could buy Boeing Aircraft Company and Kraft Foods, two giants of industry, and still have a lot of money left over.

The interest on the debt is calculated to be growing $1 milllion a day.  At that rate the debt will soon be so large that it could never be paid off and the state would have to default.

That kind of crushing debt has caused Wall Street to lower the state`s bond rating from AAA to AA to A and now A-.  That low rating costs the state more money and higher interest rates to borrow funds to do business.

It is hoped that lawmakers will be able to decide on two competing proposals — one by Senate President John Cullerton or the other by House Speaker Michael Madigan — or a combined version of the two.

That is what lawmakers are there to do at a cost of $40,000 a day.

Republicans have also offered a plan that they say will fix the problem. But without sufficient votes in Springfield, no matter how good the plan is, it does not stand a chance of passing.

Illinois lawmakers will return to Springfield Wednesday for a special session, and a conference committee is expected to be created to tackle the pension problem.

Gov. Pat Quinn, House Speaker Michael Madigan, and Senate President John Cullerton are in favor of the panel.  This is a change in Madigan’s position as last Friday he downplayed the idea, raising concerns about its effectiveness. Cullerton said after the same meeting he favored the idea of such a committee.

According to Madigan’s spokesman Steve Brown, Madigan has since changed his position and is willing to help create the committee.

The committee will try to find a compromise between the differing House and Senate bills.

The panel will have five members — three Democrats and two Republicans — from both the House and Senate.

Quinn wants a deal by early next month.

Until now, the debate on fixing Illinois’ underfunded pension system centered on two competing Democratic proposals; now, state Republicans are offering an alternative.

It would move state employees into a 401k system or something similar; they would contribute 8% of their pay to their pension, and the state would make a 7% matching contribution.

But the GOP plan isn’t given much chance of passage in a state government dominated by Democrats.

State House Speaker Mike Madigan’s pension plan would cut benefits the deepest; it has Governor Quinn’s support.

State Senator John Cullerton’s plan would cut less, and it has union support; but any plan would have to survive a court challenge.

The illinois General assembly will hold a special session on the pension crisis Wednesday.

Illinois has one of the nation’s worst-funded pension systems, and  Democrats in Springfield seem to be handcuffed, unable to get any meaningful pension reform passed.  Republicans see this as an opportunity to pass legislation of their own.

House Speaker Michael Madigan and Senate President John Cullerton will be the key legislators to determine if meaningful pension reform gets enacted during a special session this week.  Governor Pat Quinn has already said he cannot sign anything until a bill lands on his desk.

Now Republican lawmakers and members of the Illinois Policy Institute (IPI) say they have a plan that is growing in popularity in other states.

A defined contribution plan is a type of retirement plan in which the employer and the employee contribute to an account.  Only the employer contributions are guaranteed — not future benefits.

Illinois Poicy Institute CEO John Tillman said nothing in Springfield is getting done because politicians there are not interested in the citizens of Illinois.  Tillman says they are more worried about the consequences of going against the unions and their political power and funding than they are the taxpayers and voters of Illinois and the poor and disadvantaged who are trying to get a leg up and get ahead in life.

“Until there’s a consensus built around the people that care about the poor and disadvantaged, and we consider ourselves among them … you’re not going to see reform,” Tillman told reporters today at a news conference at the Thompson Center.

Even if the Democratic proposals do pass, Repblicans say that will only reduce the debt by $21 billion, taking us back to 2011 and not erasing the problem at all.

Gov. Pat Quinn called an emergency meeting of Illinois legislative leaders Friday to come up with a plan to solve the state’s pension crisis.

Quinn met with House Speaker Mike Madigan, Senate President John Cullerton,  House Minority Leader Tom Cross and Senate Minority Leader Christine Radogno.

No agreement was announced, but once again Quinn urged the leaders to work out their differences over competing bills and pass a bill to he can sign it.

The leaders said they would try again to pass Madigan’s bill in the Senate.

The measure got 16 yes votes during the session and will need 36 during next week’s special session.

With time running out and the bills piling up,. Gov. Pat Quinn and state legislative leaders again tried to work out a desperately-needed plan for pension reform.

House Speaker Mike Madigan, Senate President John Cullerton and Governor Pat Quinn met at the Thompson Center on Monday. Afterwards, Cullerton said they made progress.

“The Governor and I are now going to try to pass the original Senate Bill1. We`re hoping the Republicans will now support it. That would be a big help in passing the bill,” Cullerton said.

The two earlier competing versions of the bill would be combined into one new bill.

“We would have a bill similar to the one the speaker has passed in the house and that would be a version of the bill that we pass out of the senate and try to put that in the same bill,” Cullerton explained.  “We will see if we can pass that out of the senate and probably delay the effective that would require 30-votes.  We will make that attempt.”

“Both bills should be passed,” Speaker Madigan said. “The Governor should get to work between now and the date for the special session.  He`s got plenty of time to meet with these individual senators and persuade them that this is the time to step up and help the state of Illinois and vote yes.’

But Quinn is still pointing at Springfield as being the problem and  said his hands are tied. He said he can`t sign anything until the measure is first created in Springfield and voted upon by the legislators. He said the people of Illinois are depending on their elected officials to compromise.

“They need their leaders to do their jobs,” Quinn said. “My job is to sign the pension reform bill into law. Their job, Mike Madigan and John Cullerton and all the members of the general assembly, is to pass it and put it on my desk.”

So while they may have taken baby steps today, pension reform in Illinois still has a way to go.

Gov Pat Quinn is calling state lawmakers back to Springfield for a special session to deal with the state’s downgraded credit rating.  Quinn says taxpayers are on the hook for $17 million dollars each day without pension reform.

The spring legislative session ended last week with no deal on competing bills passed in the House and the Senate.

House speaker Michael Madigan would cut costs by cutting back on pension benefits for retirees and current state workers.

Senate President John Cullerton’s plan, which is supported by the unions, takes a more cautious approach with less savings for the state by tying pension benefits to health coverage.

Pension plan moves forward in SpringfieldThe governor called a meeting with both leaders earlier this week.

Madigan did not show up.  His spokesperson says he wasn’t available.

Senate Republican leader Christine Radogno, who supports the House plan,  says she’s hopeful, but not terribly optimistic Democratic leadership will be able to break the stalemate.

“Taxpayers absolutely should be outraged because the failure to solve the pension problem impacts every part of state government…the pension obligation is swallowing us up ,” she said.

Quinn released a statement saying,  “Time and time again over the past two years, I have proposed, asked and pushed members of the General Assembly to send me a comprehensive pension reform bill. Time and time again, failure to act by deadlines has resulted in the bond rating agencies lowering our credit rating, which hurts our economy, wastes taxpayer money and shortchanges the education of our children.”

The special session is scheduled for June 19th.

It’s the final day of the spring session in Springfield.

Lawmakers are working against the clock to come to a conclusion on a number of unresolved issues.

WGN’s Randi Belisomo has more on the story.