ACTION ALERT: House Pensions Committee to hear pension reform bill
At 3 p.m. Thursday, March 21, the House Personnel and Pensions Committee will hear House Bill 3303, sponsored by state Reps. Tom Morrison, R-Palatine, and Jeanne Ives, R-Wheaton. HB 3303 is the Illinois Policy Institute-backed pension reform plan that actually fixes the problem. Real pension reform means: Implementing a stable, predictable and manageable defined contribution system. Eliminating...
At 3 p.m. Thursday, March 21, the House Personnel and Pensions Committee will hear House Bill 3303, sponsored by state Reps. Tom Morrison, R-Palatine, and Jeanne Ives, R-Wheaton.
HB 3303 is the Illinois Policy Institute-backed pension reform plan that actually fixes the problem.
Real pension reform means:
- Implementing a stable, predictable and manageable defined contribution system.
- Eliminating the pension ramp and replacing it with a level-payment schedule.
- Heading off the need for a funding guarantee with automatic payroll contributions going forward.
HB 3303 not only accomplishes all of these things – but it is also the only pension reform bill that does. It is the only reform bill on the table that doesn’t continue to keep politicians in control of state workers’ retirements.
Between now and 2045, Illinois’ five pension systems are scheduled to pay more than $600 billion to retired government workers. The secret our elected officials are keeping from taxpayers? Illinois only has $62 billion on hand. The state is broke. Unsustainable pension costs have already crowded out resources for core government services. The state faces fiscal insolvency and is home to the worst credit rating in the nation. To add insult to injury, last week the federal Securities and Exchange Commission charged Illinois with securities fraud.
HB 3033 is the best solution for government workers, bondholders and taxpayers. It protects the benefits employees have earned to date, but transitions benefits for all future service to a new self-managed retirement plan.
These reforms will reduce the unfunded liability by approximately half, lower the fiscal year 2014 payment by approximately $2 billion and eliminate the irresponsible pension ramp.
Other merits of HB 3303 include:
- Empowering workers with control over their own retirement savings.
- Giving workers full control over their investment decisions for all future retirement savings.
- Liberating workers from contributing to the failed pension plans and instead giving them full control over their future contributions.
- Reducing the pension crowd-out of core services by eliminating the pension ramp, making sure state pension contributions gradually consume a smaller and smaller share of the overall budget each year.
- Providing accountability by setting employer contributions at a fixed percentage of payroll, with zero risk for investment returns, actuarial assumptions or future unfunded liabilities.
TAKE ACTION
- Submit an electronic witness slip online in favor of HB 3303 within the next 24 hours. It only takes a few minutes to complete (select “proponent” and “record of appearance only”). We need as many voices on the record for real reform as possible to counter expected heavy union opposition.
- Call members of the House committee to voice your support of HB 3303. Their votes will determine if we have a shot at a full floor vote of the entire chamber.