The latest battle over Illinois pension reform is expected to come to a head on Tuesday in Springfield. Governor Quinn and legislative leaders are pushing hard for a “yes” vote. Meanwhile, opponents have been working to drum up opposition, including having retirees flood lawmakers offices before the vote. The outcome is still up in the air.
State Senator Daniel Biss, from Chicago’s North Shore, is one of ten legislators appointed last June to a special committee to come up with a bill to solve the pension crisis. On the day before Thanksgiving, House and Senate leaders came up with their own plan, which they hope will pass on Tuesday.
“The pieces that have been described to me so far…it seems to me we’re heading in an encouraging direction,” said Biss, a Democrat.
The proposal aims to save 160 billion dollars over the next three decades, in order to get underfunded pensions up to where they’re fully funded. The plan would reduce the annual three percent compounding cost of living increases, giving employees one-to-five lesser COLA bumps every year.
It would require the state to contribute payments of a billion dollars a year after 2020, and it would raise retirement ages. For every year that a pensioner is under the age of 46, the retirement age would be increased by four months, up to 5 years.
“It saves a substantial amount of money, but it does it in a careful way that protects people who are in greatest need. It really protects the lowest wage workers, but then simultaneously it puts us on an actuarial funding path so that over time we’re going to get out of this hole and not get back into it,” said Biss.
Opponents, though, hope to torpedo the plan. Union leaders say it’s an unconstitutional limit on retirement promises made to public employees like teachers and firefighters. They say the cost of living cuts will make retirement impossible. Fiscal conservatives like the Illinois Policy Institute say it doesn’t go far enough.
“This bill is a lot of smoke and mirrors. It talks a lot about COLAs and retirement ages. When you strip it all down it only reduces the pension shortfall: the 100 billion shortfall to about 80 billion max, and so therefore it’s not enough savings. This is not a good deal for the state, and it will continue to keep Illinois mired in the crisis,” said Ted Dabrowski of the Illinois Policy Institute.
Illinois’ pension shortfall is considered the worst in the country. One union leader says Tuesday’s outcome will turn on the votes of 8 to 10 members of the Senate, and 15 to 17 swing votes in the House.