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updated: 5/29/2012 11:30 AM

Pension reform plan coming together

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  • Darlene Senger

      Darlene Senger

  • Elaine Nekritz

      Elaine Nekritz

  • Video: Interview with Michael Madigan

 
 

SPRINGFIELD -- The details of the pension reform proposal Illinois lawmakers will be presented with in the coming days are crystallizing, but what remains unclear is whether the changes will attract enough support to become law.

State Rep. Elaine Nekritz, a Northbrook Democrat, said cutting benefits for teachers and state workers will be focused on a reduction in the yearly pension raise for both current and future retired teachers.

While the Illinois Constitution bars a reduction in pension benefits, retirees would be given a choice to either take the less-generous annual pension bumps or potentially lose access to state-funded health care -- a benefit Nekritz says isn't protected by the constitution.

"There's nothing that protects that," she said.

The choice that would be given to employees and an accompanying contract, supporters argue, would make the plan constitutionally legal.

Union officials have not agreed to the plan offering those choices, and the Illinois Education Association has been pushing its members to call lawmakers to protest the changes for days.

Additionally, members of the Geneva-based Northern Illinois Jobs with Justice plan to rally at the Capitol Tuesday.

They want to use props including an oversized check from the state to Sears Holdings Corp. to protest lawmakers cutting pension benefits months after giving the Hoffman Estates retailer tax breaks.

Some union-friendly lawmakers might be averse to the pension changes.

Meanwhile, Republicans largely have rejected another part of the reform proposal -- one that would transfer future costs of teachers' retirements onto local schools and community colleges over time.

Lawmakers could use money saved by shifting the cost of teacher pensions on to local governments to pay down debt.

Under a plan that's being considered, local districts wouldn't have to pay teachers' pension costs next school year because the state is already planning to make that payment in the budget they're considering. After that, what districts have to pay would be phased in at 1 percent of payroll a year for the next five years.

Lawmakers could use money saved by shifting the cost of teacher pensions on to local governments to pay down debt.

But, Nekritz said, the particulars on how the phase-in would work is a detail that's still under discussion.

Others could argue the benefit cuts aren't deep enough and won't create enough savings when the state faces $83 billion in pension debt, the highest in the nation.

So, the Springfield question of the week will be whether the various pieces, put together, can draw enough support. If not, it could be back to the drawing board for top lawmakers trying to piece together a pension reform puzzle.

Thursday is lawmakers' self-imposed budget deadline, and state Rep. Darlene Senger, a Naperville Republican, said Monday she thought a pension proposal might be put in writing when lawmakers returned to Springfield after the weekend. It wasn't, yet, but could be ready as early as Tuesday.

"I expected a bill on my desk when I came back," she said.

The annual cost of living increase for pension benefits is the biggest benefit factor lawmakers could change to try to save the state money long term.

"That moves the needle of the unfunded liability more so than not," Senger said.

It's a complicated plan, and in the next three days, it'll compete for lawmakers' attention along with the annual state budget, finishing Medicaid reforms, gambling expansion plans and dozens of bills from rank-and-file lawmakers that they'll try to push through before the Thursday deadline.

If lawmakers miss that deadline, the budget legislation would require more votes for approval, giving Republicans a bigger say in spending plans in the Democrat-controlled Legislature.

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