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Article updated: 1/5/2013 6:46 PM

Saturday meeting fails to produce pension plan

By Mike Riopell

SPRINGFIELD -- Two years ago, the current members of the Illinois General Assembly took their seats only hours after their predecessors -- facing a seemingly insurmountable budget deficit -- and took a late-night vote to raise the state's income tax rate.

The hotly controversial move significantly cut the staggering deficit but also left lawmakers with a state still crippled by debt.

Now, as that group is about to leave office Wednesday, a similar 11th-hour showdown looms over both Illinois' financial future and the retirement security of thousands of teachers, road workers, prison guards and others. As the House prepares to meet this afternoon, there still is no agreement on a plan that could garner enough support to pass.

A Saturday meeting in Chicago of Gov. Pat Quinn and top lawmakers didn't produce an agreement on how to move forward.

"Everyone had an opportunity to share their thoughts and perspectives," said state Senate Republican Leader Christine Radogno of Lemont, who labeled the gathering "somewhat" productive.

"We are committed to working to solve the problem, but lots of work remains to be done," Radogno said.

Faced with escalating pension payments every year, lawmakers are considering cutting workers' retirement benefits even though the Illinois Constitution says those benefits can't be "diminished."

Quinn announced Friday that a controversial plan to have suburban schools pick up some of the state's bill on teachers' pensions would be scrapped for now, a move Radogno praised and one that could lure Republican support.

"I think we are on the eve of collaboration where people of good faith come together and do what has to be done for the common good," Gov. Pat Quinn said Friday in Wheaton.

Others aren't so sure.

Senate President John Cullerton dismissed the Illinois Senate Thursday and said he'd call them back to Springfield to act if the Illinois House approves a deal in the coming days.

"I don't anticipate that," Cullerton said. "But it's possible."

Even if Cullerton called his members back, they wouldn't be scheduled to meet in Springfield until 3 p.m. Tuesday -- the day before new lawmakers are sworn in -- an extremely tight schedule, especially for an institution that famously and routinely runs late.

Still, the high stakes have made it a pressing priority.

"We are still pushing to get something out of the House," said state Rep. Elaine Nekritz, a Northbrook Democrat and sponsor of multiple pension plans that haven't won approval.

Lawmakers typically acknowledge it's their own fault -- not teachers' and workers' -- that the state's retirement debt is nearing $100 billion. But the rising yearly payments threaten to further choke off state money for everything from schools to the disabled to parks.

Illinois government already faces around $9 billion in unpaid bills and a budget situation that has led to cuts throughout the state for the last few years.

As a result of late payments, parents of disabled children often can't get respite workers to give them a break.

Funeral homes and family are often not reimbursed by the state for burying the poor.

And as the state sends less money to universities, suburban parents and students are feeling the pain in rising tuition payments and loans that could haunt them for decades after they graduate.

On the other hand, though, are teachers whose financial security could take a hit if lawmakers cut benefits. Among the ideas being debated would be having teachers pay more of their salaries toward their pensions and cutting their yearly benefit increases.

"Everything about my life could change in this lame-duck session," said Rainy Kaplan, a high school Spanish teacher in Westmont Community School District 201.

Union leaders have asked officials to put the debate off until later in 2013, when a new set of lawmakers can continue the debate in conjunction with their annual budget-making process.

Union leaders have vowed legal action if benefits are cut, forcing lawmakers to either try to find savings elsewhere or try to prepare legislation they think would survive in court.

"There's just not enough time," said Illinois Federation of Teachers President Dan Montgomery. "It's a complicated problem."

The standoff is unlike the federal fiscal cliff in that the Wednesday deadline brings no automatic tax increases or spending cuts. But as the new General Assembly prepares its budget this year, pension costs will weigh heavily. Lawmakers will have to commit at least $1 billion more to the state retirement systems than last year, which was already a record high payment.

Also, inaction on pensions would catch the eyes of bond-rating agencies, which could further downgrade the state's credit and make it more expensive for Illinois to borrow money to build roads, bridges and schools.

"Illinois' pension disaster is a statewide problem, not just a Springfield problem," DuPage County Board Chairman Dan Cronin said Friday. "This is a crisis that needs to be dealt with right now, not in a few weeks, not in a legislative session, not with a new General Assembly. No. Right now."

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