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Article updated: 5/1/2013 6:06 PM

Illinois House showdown on pensions possible today

Illinois speaker of the House Michael Madigan

Illinois speaker of the House Michael Madigan

 
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SPRINGFIELD -- A committee of state lawmakers Wednesday set up a showdown in the Illinois House Thursday over legislation to cut public employees' pension benefits.

Unlike previous proposals that have sputtered for months, the plan approved by a House committee Wednesday, and headed for a possible full House vote Thursday, was sponsored by House Speaker Michael Madigan, a powerful Chicago Democrat.

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Madigan's pension plan

Illinois House Speaker Michael Madigan's new pension cost-cutting proposal would:
• Try to guarantee the state pays its share into pension funds every year.
• Cap how much of an employee's annual salary can count toward a pension at about $109,000. That number would grow slowly over the years.
• Reduce retirees' annual cost-of-living adjustments. A retiree would get a 3 percent annual increase calculated on $1,000 for every year worked. Someone who worked 20 years would get an annual increase of 3 percent of $20,000, or $600.
• Require employees to pay 2 percent more of their salaries toward retirement.
• Raise the retirement age by one to five years, depending on how old a worker is when the law takes effect.

It would raise the retirement age for teachers and state workers, make them pay 2 percent more of their salaries toward retirement and reduce retirees' annual benefit raises.

The plan, which largely resembles one pushed by state Elaine Nekritz of Northbrook, was approved by a 9-1 committee vote.

Union leaders fought back hard. Illinois Federation of Teachers President Dan Montgomery painted a picture at the morning hearing of teachers already at work for hours in schools around the state as lawmakers vote to cut their retirements.

"They're doing the work of the state as we need them to do," Montgomery said.

Meanwhile, Senate President John Cullerton announced union leaders had offered their own plan he thought was good enough to take to his fellow Democrats.

Cullerton wouldn't elaborate on how the apparent secret plan works, except to say it would give public employees some kind of choice between pension reductions and other options.

"There's still some details to work out," said Cullerton, a Chicago Democrat, who has called plans like Madigan's unconstitutional.

Madigan's proposal wouldn't ask suburban schools to pay more toward teachers' pensions, a controversial idea that could cost local school districts millions of dollars per year.

But Madigan clearly hasn't forgotten about the idea, which he supports.

"I plan to deal with that in another bill," he said.

After the hearing, Madigan said details of how schools would be asked to pay more need to be worked out, but he said that effort will be made "soon."

Republicans have been relatively united against that idea, as have many suburban Democrats, so its eventual fate is unclear. Keeping the divisive topic out of a more broad pensions proposal has helped Madigan's plan win support, particularly among the GOP.

State Rep. David McSweeney, a Barrington Hills Republican, told union leaders his vote to cut their benefits was one to save the state's pension funds from going belly-up.

"We're here to save your pensions," McSweeney said.

Among committee members from the suburbs, state Reps. Nekritz, McSweeney, Darlene Senger of Naperville, Tom Morrison of Palatine and Carol Sente of Vernon Hills voted for it.

State Rep. Raymond Poe, a Springfield Republican, was the lone "no" vote.

Despite his support, Morrison said he still has concerns. The Republican lawmakers has backed a plan that would move public employees to 401k-style retirement plans.

"I'm still going to fight for the real reform I think is necessary," he said.

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