pensions

IL SENATE DEMOCRATS / TWITTER

Budget talks at the Illinois Statehouse have shown no real sign of progress. This week, Senate Democrats pressed Governor Bruce Rauner’s administration to explain its proposal to shift pension costs to local school districts.

The governor’s budget director, Hans Zigmund, defended the idea at a Senate committee, saying Illinois would face a deficit worth billions absent this or other cost-saving measures.

If the shift is approved, school districts around the state would pay an additional 25 percent of their pension costs in the next year alone.

New Rauner Budget Relies On Tax Hike He Opposed

Feb 14, 2018
Brian Mackey/NPR Illinois

Illinois Gov. Bruce Rauner has been campaigning relentlessly against last year’s income tax increase but, in his annual budget address today, he'll call for spending the extra money that rate hike has generated.

Rauner wants more money to go to education and less to be spent on things like prisons and the judiciary.

According to a preview document obtained by public radio, the governor will not call for an immediate rollback of the tax increase.

Northwestern University's Pritzker School of Law

A 1917 report conducted on the Illinois pension system revealed bad news. After a pension-focused trip around the globe, with studies on such nations as Great Britain, New Zealand, and Austro-Hungary, it got to the crux of the matter:

Jenna Dooley

A report from Chicago-based nonprofit Truth in Accounting found taxpayers would have to pay more than $45,000 each to cover the state’s unfunded debts. 

The report examined the fiscal year before Illinois entered into the current budget impasse. Sheila Weinberg, the founder of Truth in Accounting, says things have only gotten worse because the state is racking up more debt without a budget.

Weinberg notes taxpayers may be tired of all the bad news, but says they need an accurate picture of the state’s situation.

illinois.gov

Springfield may be a desert when it comes to budget deals, but it seemed like there was a small oasis: an agreement between Republican Gov. Bruce Rauner and Democratic Senate President John Cullerton on pensions.

They say Illinois could save a billion dollars a year by forcing teachers and state workers to make a choice. Either retire on a higher pensionable salary, or be allowed to receive compounded cost-of-living bumps upon retirement.

During his budget address last week, though, Rauner signaled impatience:

Flickr user Pictures of Money / "Money" (CC BY 2.0)

Little changed about Illinois pensions since the state's high court declared lawmakers' last attempt unconstitutional. But the state's leaders signaled they may be ready to talk about trying again.

“No one wants to talk about it, but we have to.” House GOP Leader Jim Durkin said last week while leaving a private meeting with the governor and other legislative leaders, where Durkin says they had a healthy discussion about pensions. “Unfunded liability continues to grow. We can't lose sight of that. We can get there at some point.”

Flickr user 401(K) 2012 / "Money" (CC v. 2.0)

The City of Chicago is preparing to make its final case to the Illinois Supreme Court that changes to some of its underfunded pension systems are constitutional.

City attorneys argue their changes to city workers’ retirement benefits prevent the funds from running out of money.

Let’s say the pension funds run out of money. The city thinks unions representing those workers will go back to court - asking a judge to force the city to pay the very pensions that are out of money.

Amanda Vinicky

Another lawsuit over a pension law was filed this week in Illinois, this time seeking to strike a law that reduced Chicago Park District pensions. That could be significant for other local governments, and future negotiations.

When it first passed, the park district pension law was seen as a possible model for future ones. That's partially because it had been drafted in cooperation with SEIU, the union representing park district workers.

Flickr user Daniel Borman / "Money, Money, Money" (CC BY 2.0)

Illinois state lawmakers are warning key figures in Chicago and Cook County governments to draft back-up plans for their underfunded pensions.

Chicago Mayor Rahm Emanuel and Cook County Board President Toni Preckwinkle are both trying to approve changes to the retirement benefits their government workers receive because the funds are running out of money.

But that comes after the state Supreme Court called reductions in benefits to State of Illinois employees’ pensions unconstitutional.

WBEZ

Cook County Board President Toni Preckwinkle is pushing to restructure the retirement benefits of county employees. But she needs Springfield’s help to do it -- and that’s proving to be a challenge.

Like the state of Illinois and City of Chicago, Preckwinkle wants to lower the costs of pensions for Cook County. That’s in spite of legal questions.

Some key unions argue her plan is unconstitutional. But Preckwinkle has other hurdles to clear before it’s tested in court.

Mayor.cityofchicago.org

  Chicago’s top lawyer is defending the city’s pension plan, even as an investor service is downgrading the city’s bond rating.

The city owes billions in pension debt. 

Top attorney Steve Patton argues proposed changes to Chicago’s troubled pensions will withstand a legal challenge, even though the Supreme Court just ruled against changes to State of Illinois retirement funds.

"We don’t think you even get to the question of whether some defense or exception applies because we don’t think that our law violates the constitution in the first instance," Patton said.

Pension Overhaul In Hands Of State Supreme Court

Mar 11, 2015
Illinois Supreme Court

Oral arguments on whether state law passed in 2013 will stand were held Wednesday before the Illinois Supreme Court. 

The law reduces benefits for public employees like teachers, prison guards and many others.

State-employee unions object, citing a section of the state constitution -- Article VIII Section 5 -- which they say clearly prevents the state from taking such action.

Illinois Solicitor General Carolyn Shapiro, representing the state, disagrees.

Illinois Supreme Court Will Hear Arguments On Pension Law

Mar 11, 2015
State of Illinois

It's been more than a year since Illinois passed a major overhaul of government-employee pensions. Today, the law goes before the state Supreme Court. 

The law being challenged does away with retirees' compounded cost-of-living raises and increases the retirement age for younger workers. It also gives employees a small break on how much of their paycheck automatically goes toward their future pension.

Back when he signed it in 2013, then-Gov. Pat Quinn called the reform a bipartisan victory.

"Everyday people, I think, will benefit from this reform," Quinn said.

Although one court has tossed out Illinois’ mega pension overhaul, state leaders are likely to wait on another legal opinion before deciding what to do next.

There’s no question -- the Sangamon County Circuit Court judge’s ruling is meaningful. But Attorney General Lisa Madigan’s office is appealing to the state Supreme Court.

Madigan has said it makes sense for lawmakers to wait to hear from those justices.

Brian Mackey

Politicians, public employee unions and others spent the last several years focused on pensions. Illinois racked up a $100 billion unfunded liability -- largely because lawmakers didn't pay the state's share of its workers retirement benefits.

Eric Madiar is the top attorney for the Illinois Senate President. He found a report that said Illinois' pension systems were on the "verge of insolvency" in 1917.

"...and it stemmed primarily from the fact had not been properly been financing pensions."
--- Eric Madiar, Senate Democrats' Chief Legal Counsel

State of Illinois

Legislators passed a law overhauling the state's retirement systems. Soaring pension debt remains a concern. The law's constitutionality is also in question. It reduces workers' and retirees' benefits, and raises the retirement age.

Judge Puts Hold On Pension Reform Law

May 15, 2014
flickr user / Brian Turner (CC BY 2.0)

Sangamon County Circuit Court Judge John Belz has issued a temporary restraining order that prevents Illinois' pension reform law from being implemented until questions about the law's constitutionality and a suit challenging it can be resolved.  The law was scheduled to take effect June 1. 

Five lawsuits by groups representing state workers and retirees challenging the law have been consolidated in Sangamon County court.   

It's a temporary victory for government employees who say the law is unconstitutional.

Pension Committee Update

Sep 27, 2013
Brian Mackey / IPR

A special committee has been negotiating over how to solve the pension problem for more than 12 weeks. 

State Rep. Elaine Nekritz, D-Northbrook, is careful these days when she talks about the status of pension deliberations, and especially when asked how close legislators are to reaching a deal.

"I have actually stopped making predictions publicly, because I have been so wrong, that I'm a little bit embarrassed at this point," she says.

Illinois Public Radio

The estimated savings on a state pension proposal backed by Illinois House Speaker Mike Madigan is billions of dollars less than originally thought.  

The Teachers Retirement System made a mistake in its calculations. The revision was outlined in a letter to the bipartisan panel working on solving Illinois' pension shortfall.

ilga.gov

Illinois lawmakers and Governor Pat Quinn remain at a standstill over a pension overhaul plan. Legislative leaders sued the Governor last week after he blocked lawmaker paychecks because of inaction on the state's growing pension obligations.

Legislative Leaders Sue Quinn

Jul 31, 2013
state of Illinois

The leaders of the Illinois General Assembly have sued Governor Pat Quinn over his veto of lawmakers' salaries.

Quinn vetoed lawmakers salaries out of the budget as a sort-of punishment for not passing legislation to overhaul Illinois' government-employee pension systems.

In a joint lawsuit filed in Cook County, House Speaker Michael Madigan and Senate President John Cullerton say the governor overstepped his bounds.

Rikeesha Phelon is a spokeswoman for the Senate president:

Brady: Pension Panel Close To Compromise

Jul 30, 2013
Illinois Public Radio/WUIS

A member of the Illinois General Assembly's special pension committee says the group is waiting for what he hopes will be the final round of budget analysis.

The pension conference committee is trying to find a way to reduce Illinois roughly $100 billion in unfunded future pension liabilities. The group comprises 10 senators and representatives, both Democrats and Republicans.

State Sen. Bill Brady is a Republican from Bloomington. He says there has been a lot of compromise.

Credit Union Offers Loan To Lawmakers

Jul 29, 2013
state of Illinois

Illinois lawmakers will not be getting their monthly paycheck, starting next week. At least one financial institution is offering to help tide them over until the General Assembly's dispute with the Governor is resolved.  Lawmakers' base salary of $68,000 has been set to zero - Gov. Pat Quinn vetoed their pay out of the budget as a sort of punishment for the General Assembly not passing a pension overhaul.

Topinka: No Checks For Lawmakers

Jul 26, 2013

Illinois lawmakers will not get their paychecks for the month of August. Governor Pat Quinn took the unusual step earlier this month of cutting lawmakers’ pay from the state budget.

He says they won’t get paid until they pass a pension overhaul.

state of Illinois

Illinois lawmakers will gather for a special session Wednesday. They were called to address the state's pension crisis. But they're expected to pass off the problem to a legislative committee.

ilga.gov

The top Republican in the Illinois House of Representatives says he thinks Democratic leaders are purposely not passing pension reform for their own political gain.

There are lots of conspiracies for why pension reform hasn’t been approved.

One is that it’s purely a legal debate over how to interpret the constitution.

Another - is that the powerful House Speaker and state Democratic Party Chairman Michael Madigan - is stalling because it would somehow help his daughter, Attorney General Lisa Madigan, to become governor in next year’s election.

Expert: Quinn Must Win On Pensions

Jun 11, 2013
UIS

Illinois Governor Pat Quinn “Desperately needs a win” on pension reform. That’s the conclusion of political scientist Kent Redfield. The U of I - Springfield professor spoke ahead of next week’s special session on pensions, which Quinn ordered. Redfield says the Governor repeatedly blamed pension costs for the state's budget problems. If no agreement is reached, Redfield says, Quinn will look weak going into next year’s primary election:

Illinois Municipal Pension Fund On Firm Ground

Jun 4, 2013

It's no secret that Illinois has one of the worst funded pension systems in the country. But the fund that covers municipal workers is in better shape.

What's Left? Pensions, Guns, And Same-Sex Marriage

May 31, 2013
Illinois Public Radio / Chris Slaby

Illinois has the worst funded pension system in the nation, and lawmakers have until tonight to do something about it. 

The General Assembly is scheduled to adjourn by midnight.  After that, it requires extra votes to get legislation to the governor's desk.  Pensions are not the only thing left. 

Recent Statehouse Action:

Brian Mackey / Illinois Public Radio

Illinois Democrats continued approving a new state budget on party-line votes. The Senate approved spending plans for education --  from elementary and high schools to colleges and universities -- with funding pretty much at last year's level.

Cuts proposed earlier this year by Governor Pat Quinn did not materialize, partly because Illinois collected more tax money than it expected in April.

Sen. Dan Kotowski, D-Park Ridge, says funding for higher education is critical because it's tied to the problem of unemployment.

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