By Benjamin Yount | Illinois Watchdog
SPRINGFIELD — Not even the authors of Illinois’ latest pension reform proposal are in love with the idea.
State Rep. Elaine Nekritz, D-Northbrook, says the plan to tweak cost-of-living adjustments and increase employee contributions is “not an ideal solution.” State Rep. Dan Biss, D-Evanston, said the reform package is “not perfect,” but he pleaded with lawmakers to find some way to “support this legislation.”
The public employee unions that don’t want Illinois legislators to overhaul the pension system downright hate the plan.
Illinois Federation of Teachers’ chief Dan Montgomery accused lawmakers of “plunging ahead with an illegal plan that, from our point of view, violates your oath of office.”
Illinois AFSCME boss Henry Bayer told lawmakers they are trying to take away what has been “earned and is owed” to public employees.
But with time quickly running out in the lame-duck session, the less-than-perfect pension proposal is headed for a Tuesday vote in the Illinois House. Lawmakers have until noon Wednesday, when a new Legislature is sworn-in, to send a pension reform proposal to Gov. Pat Quinn.
The latest plan would freeze COLAs for all workers and retirees for six years. Once reinstated, they would only apply to the first $25,000 of a retirees’ income, and workers would have to wait until age 67 to receive a COLA bump. Public workers would also be required to pay more for their retirement benefits. But the plan does not include a cost shift that would have local schools and governments pick up more of the cost.
Illinois’ largest public employee unions — the Illinois Federation of Teachers, the Illinois Education Association, the American Federation of State, County and Municipal Employees and the Service Employees International Union — are warning lawmakers that any reform to which the unions do not agree would be met with a lawsuit. Illinois’ constitution specifically protects public pensions.
Instead of benefit reductions, the unions want lawmakers to raise taxes on corporations to pay for Illinois’ $93 billion to $130 billion pension gap.
“We don’t have a benefit problem,” said Cinda Klickna of the IEA. “We have a revenue problem.”
Illinois’ pension woes go back years and can be partially blamed on lawmakers and governors who did not make the state’s full pension payment.
But House GOP Leader Tom Cross, R-Oswego, said the time for finger-pointing has ended.
“Many of the people … that are going to complain about this solution didn’t mind when the General Assembly didn’t make payments” said Cross. “Because at the same time, more money was going to pay raises or a state contract.”
Bayer of AFSCME accused Cross and other lawmakers of trying to put the pension burden on the “backs of workers.”
But Laurence Msall, president of the Chicago-based Civic Federation, said all taxpayers are bearing the brunt of Illinois’ worst-in-the nation pension crisis.
“Our taxes are going, and will increasingly go, to pay debt and not (for) current services,” said Msall.
The Civic Federation estimates that by 2045, 60 percent of state money will go toward pensions.
Msall and other business leaders say it will be difficult to persuade businesses to move or expand in the state because of uncertainty over taxes.
The pension-reform proposal now faces a fast-approaching deadline and an uncertain future.
The Illinois House is expected to vote on the plan Tuesday. Leaders in the Senate have said they will call lawmakers back to Springfield as well Tuesday, if there is something to vote on.
The 98th General Assembly will be sworn-in at noon Wednesday.
Contact Benjamin Yount at Ben@IllinoisWatchdog.org