Pension Plans Move to Illinois Senate

March 13, 2013

An Illinois Senate panel has approved two competing versions of a pension overhaul.

The plans would cut benefits for state and university employees, as well as Downstate and suburban public school teachers. 

Both proposals would raise the retirement age and reduce the annual cost-of-living increases pensioners would get.

Senate President John Cullerton acknowledges that because of expected legal challenges, any money saved is likely to be in the future.

"Unfortunately none of these bills will help us in this current fiscal year because they'll undoubtedly be challenged and it will take a while for that to be determined," Cullerton said.

One issue is a provision in the Illinois Constitution that says "pension benefits … shall not be diminished." Sounds simple enough, but law professor Mark Rosen said the meaning of that phrase might not be as clear as it seems.

"Absolute constitutional language of the sort that we have in the pension clause, is not typically -- in (the) Illinois Constitution or the United States Constitution -- absolute and categorical," Rosen said.

The pension systems are about $100 billion short of being able to meet future payments. The idea is the risk the systems will eventually go broke is its own form of "diminishment."

Rosen pointed to other constitutional protections the courts have limited -- like restrictions on free speech.

The measures now go before the full Senate, where it remains to be seen whether they have enough votes to pass.

Lawmakers have failed to agree on an approach over the year, despite urgent nudges from Gov. Pat Quinn.

House Speaker Michael Madigan expressed optimism that a pension overhaul is possible this spring.

Madigan told reporters Wednesday that lawmakers are more educated about the issue now than before. He would not say what particular pension proposal he backs except that the answer is in addressing cost-of-living-adjustments. He would not give further specifics, saying he is open to all approaches.   

Illinois has the worst pension problem of any state in the country.

Story source: Illinois Public Radio