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updated: 10/3/2012 3:32 PM

28th Senate hopefuls talk pension reform

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  • Daniel Kotowski, left, opposes Jim O'Donnell in the 28th Senate District for the 2012 General Election.

    Daniel Kotowski, left, opposes Jim O'Donnell in the 28th Senate District for the 2012 General Election.


Democratic state Sen. Dan Kotowski says he will stop pension abuse by preventing politicians from double-dipping, while his challenger in the 28th Senate District race, Republican Jim O'Donnell, supports creating a hybrid pension plan for state employees blending defined benefits and contributions.

Kotowski, 45, of Park Ridge, who currently represents the 33rd Senate District, faces O'Donnell, 61, a political newcomer also of Park Ridge, in the Nov. 6 election. The newly drawn 28th District runs from Roselle east through Schaumburg, Elk Grove Village, Des Plaines, Rosemont and Park Ridge.

Both candidates say they believe in honoring the state's pension obligations to current retirees.

"Our pension obligations are a fixed cost that need to be met," Kotowski said. "For decades in our state, politicians from both political parties failed to recognize that fact and that led to the financial crisis we now face in our state. I sponsored the spending reform law to end this reckless practice."

Kotowski touts his role in passing legislation to confiscate campaign funds and pensions of politicians convicted of fraud or corruption, and his sponsorship of legislation to eliminate free health care for life for retired politicians and state employees.

"I supported the law banning inappropriate gifts to pension board members and strengthening protections against their potential conflicts of interests," he said.

Kotowski said in 2010 he supported the creation of a two-tier pension system for new public employees and has urged House Democrats to vote on legislation that would reduce benefits of politicians and protect the retirement of state employees.

"I will also push to stop people from receiving a public pension from a previous job when they are working at another full-time, taxpayer-funded job," he added.

O'Donnell said he believes House Speaker Mike Madigan will rally Democrats during the lame-duck session to ram through legislation that shifts the burden of pension costs to suburban school districts, forcing them to increase property taxes.

"It's going to be similar to the last lame-duck session when we got a 67 percent (income) tax increase," he said. "There will be some remedial reform that's not real reform and the balance of it will be cost shift. Besides adding to what is already an unbearable property tax burden, this has the potential to create unfunded mandates for the local districts because the General Assembly would continue to set benefit levels."

O'Donnell, vice president and chief financial officer of Camcraft, Inc., said there is no way the state can afford the more than $600 billion in future benefits promised by the various pension systems with only $70 billion in assets to pay for them.

His multi-point plan includes suspending cost-of-living adjustments until the unfunded pension liability is reduced, increasing the minimum retirement age for certain employees not nearing retirement, preserving pension benefits earned to date, and limiting the impact on the ability to retire for those currently eligible.

O'Donnell is a strong proponent of eliminating the legislator pension program and replacing it with a 401k-type plan. He also vows to opt-out of the legislative pension system, if elected.

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