The lame duck session came and went without legislation passing on pension reform in Illinois. Now that the new General Assembly has been sworn in, the next phase in the ongoing journey towards pension reform in Illinois begins.
The We are One Coalition, a group of about 20 Illinois labor unions, which collectively represent more than 1 million members including police, firefighters and teachers, is calling on lawmakers to sit down for a summit to work together on a comprehensive pension reform deal that would be palatable to state government and well as public workers and retirees.
"On the first day of the new General Assembly, our union coalition is renewing its call for a summit with lawmakers,” reads a statement by the coalition. “We encourage returning and newly elected legislators to abandon the pension schemes which dominated the last General Assembly. Those ill-advised plans were unfair and unconstitutional, and thus never received enough support to become law. Simply put, they failed in the legislature and, worse yet, failed the people of Illinois. The lame-duck session made it clear once again: Legally dubious proposals developed without working with those most directly affected--public employees and retirees--are a recipe for failure.”
One of the proposals that did not sit well with unions and their supporters was a last minute amendment to SB 1673 by State Rep. Elaine Nekritz and Gov. Pat Quinn that would have created an independent commission, appointed by legislative leaders, which would have had power to make automatic changes to the state’s pension system via their recommendations. The commission’s changes would have only been overridden by a majority vote in both the House and Senate.
Because the House failed to vote on any of the pension reform bills that were in front of them during the lame duck session, legislators, for the most part, are saying they will continue to push for similar versions of bills that have previously failed to passed both chambers.
State Rep. Nekritz told the State Journal-Register that she will push a bill drafted with other House members that would cut pensioners’ cost-of-living adjustments (COLA), guarantee that the state makes its pension payments, call for higher employee contributions and include the controversial move to divert the pension costs of downstate educators to their respective school districts, which is unpopular amongst Republicans and downstate Dems. The We Are One has praised Nekritz’s plan for including a pension funding guarantee in the past, albeit it was one they considered to be weak, and has also approved of her attempts to suggest “a revenue stream to help the state make future payments.”
Meanwhile, Senate President John Cullerton is expected to bring back his unpopular plan that would give public workers and retirees a “choice” between either keeping their COLA or their retiree health care plan.
Labor leaders and the We Are One Coalition argue that
these proposed solutions could cause public retirees to see deep cuts to
their pension payouts or lose access to retirement health care — both
are scenarios that they find to be unacceptable.
Most state retirees earn “modest” pensions of about $32,000 a year, with workers having chipped in about eight to 10 percent of every paycheck into their pension funds, according to Anders Lindall, spokesman for AFSCME Council 31.
Last month, Lindall told Progress Illinois that COLA increases – not to be confused with pension benefit increases – should keep up with inflation to adjust with the rising costs of goods and services “so that seniors don’t have to choose between paying costs for prescription drugs, food, heating their homes, but they’re able to do all of those things.”
Critics have blamed state lawmakers for mismanaging Illinois’ pension system in two ways: First, by not increasing employee contributions and second, by diverting revenues from the pension system into other government services like police and fire protection.
“But we’ve got to have adequate revenue to do those things and to meet our obligations, including securing the retirement of people who’ve given their working lives to provide those services,” Lindall said.
In a report released by the coalition last month, the unions offered up a suggestion to have Illinois employees ante up another two percent of their salaries to go towards retirement payments; that is if the state will make an “ironclad guarantee to give Illinois employees a contractual right to timely and sufficient payments.” Such a move could raise an extra $350 million a year for pension coffers, according to the coalition.
Additionally, unions say they want to see legislators plug corporate tax loopholes that give breaks to profitable companies in the state, which amount to about $2 billion in lost potential revenue.
A two-year old gambling expansion bill did see some action during the lame duck session after Cullerton released it from a parliamentary hold yesterday that it had been under for the past couple of years. According to the Sun-Times, Quinn could use that bill as collateral while negotiating with lawmakers on pension reform. Stay tuned.
Brandon Campbell contributed to this story.