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posted: 10/18/2012 12:01 AM

Candidates for the 57th House District talk pension reform

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  • Republican Jonathan Greenberg opposes Democrat State Rep. Elaine Nekritz in the 57th State House District in the 2012 General Election.

      Republican Jonathan Greenberg opposes Democrat State Rep. Elaine Nekritz in the 57th State House District in the 2012 General Election.

 
 

The two candidates in the Illinois 57th House District race agree that reforming the state's pension system is one of the most important tasks facing the state legislature.

They differ a bit in how to accomplish that.

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State Rep. Elaine Nekritz, a Northbrook Democrat, is facing off in the race against Jonathan Greenberg, a Republican who's also from Northbrook. Nekritz, a former real-estate attorney, has served in the General Assembly for 10 years. Greenberg, an executive with a not-for-profit organization, is running for his first term. The election will be held on Nov. 6.

Greenberg said that for him, the ideal solution to the pension problem would include moving all state employees to a 401(k)-style defined-contribution plan, rather than the existing defined-benefit plan. He said he'd support making an exception for teachers, who don't receive Social Security benefits. For them, he'd be in favor of a hybrid of the two retirement-plan approaches.

"Again, this is in an ideal world," he said. "It's not that I have to have this, or I won't vote for anything, but I do think it makes the most sense."

Nekritz said she's not sure about the idea of moving all employees to a 401(k)-style plan. Doing so, she said, could make it harder for the state to pay off its existing pension liability of roughly $89 billion.

"If you stop having that flow of money from active employees into (the pension system), the state's payment would balloon to the point where it's completely unaffordable," she said.

Still, Nekritz said she's open to incorporating some 401(k)-style characteristics into the state's retirement programs. She said she's heard proposals in the General Assembly for "cash-balance plans" that have traits of both the defined-benefit and defined-contribution approaches. Something like that could be a solution, she said.

Nekritz and Greenberg agreed on other proposed changes to the pension system, like raising the retirement age and reducing annual cost-of-living increases.

Recently, state leaders have discussed the idea of making local school districts responsible for future teacher pensions. Greenberg said he's against the idea.

"It would be a big mistake," he said. "It would raise people's property taxes. Passing off a screw-up that the state made to property taxpayers is a real mistake."

Nekritz supports the idea. She stressed, though, that the proposal only pertains to future pension costs, not the existing debt. She added that shifting that burden would make local school boards more conscious of the future when they set salaries and approve increases.

"I believe that if we're going to reform the system and create the right incentives to keep down costs for property-tax payers ... then it's necessary to make sure that the agency setting wages and salaries is responsible for those wages and salaries and benefits," she said.

The candidates both said that while they're committed to reforming the pension system, they also realize that changing retirement plans will have a real human cost.

"Sometimes we talk about this in terms of numbers. But it's not just about numbers. It's human beings and their retirement," Greenberg said.

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