Cullerton: Pension debate “not resolved”

SPRINGFIELD — Facing some of the most dire state finances in the country, Illinois lawmakers adjourned their annual session Friday without addressing the $100 billion in pension debt largely at the root of the state’s money woes.

Now, lawmakers led by the Democrats who control the Capitol return home to face constituents who elected them after they campaigned to fix the problem.

Two plans — a proposal drafted by suburban Democrats to cut teachers’ and workers’ pensions and a union-backed plan to let them choose to cut their retirement or health care benefits — kept lawmakers at odds for months.

One option backed by union leaders takes criticism because it wouldn’t save enough money toward the state’s immense debt.

“We’ll have to figure out how we can impress upon folks that a math-driven problem requires a math-driven solution,” said state Rep. Elaine Nekritz, a Northbrook Democrat.

The other, favored by Nekritz, the House and many Republicans, takes heat for being unfair and unconstitutional, compromising the retirement future of workers who have never failed to pay into their accounts.

And the two options are so different and without a clear path to compromise that another summer of gridlock could be coming.

“This is wrong,” Gov. Pat Quinn said in a statement. “I will call the legislative leaders together in the coming week to forge a comprehensive pension reform agreement.”

The plan favored by Nekritz was championed by powerful House Speaker Michael Madigan, but Senate Democrats gave it barely half the votes it needed to succeed.

Similarly, the Senate’s union-backed plan was never called for a vote in the House.

“Truly, I’m angry,” said state Sen. Melinda Bush, a Grayslake Democrat. “Don’t purport that this is the Senate’s fault.”

No pension legislation would have had a direct impact on the budget lawmakers approved this week, but bond-rating agencies suggest a downgrade could be coming to a state that already has the worst credit ratings in the nation.

Throughout Friday, Gov. Pat Quinn met with lawmakers to try to convince them to flip and support the Madigan pension plan. But the huge disparity couldn’t be overcome.

As the state’s top executive, Quinn could face the biggest political fallout over the inaction even though it’s lawmakers who are at odds.

State Rep. Jack Franks, a Marengo Democrat, is already calling on Quinn to keep lawmakers in Springfield past their Friday deadline in an attempt to hash out a solution.

“If the governor believes what he says about the necessity of pension reform, inaction on his part borders on negligence,” Franks said in a statement.

That idea is fraught with political and legal problems, though.

Starting Saturday, legislation that would take effect immediately would require a three-fifths vote, not a simple majority. Supporters of any pension plan have a hard enough time lining up a majority, so 60 percent is seems unimaginable.

The union-backed plan met that threshold in the Senate this year.

“This issue is not resolved,” Cullerton said. “I am committed to staying at the table until a comprehensive solution is passed into law.”

Lawmakers could delay when the legislation would take effect, but doing that might delay a court challenge by six months or more and in turn delay when the Illinois Supreme Court would rule whether any benefit cuts are legal.

Those complications illustrate how hard the issue has been for lawmakers. The debate has split them along regional, political and ideological lines, and Friday’s adjournment without a deal eerily echoed May 31 of last year, when lawmakers did the same thing.

“I feel like I’m hearing the same speeches tonight I heard a year ago,” said House Republican Leader Tom Cross, an Oswego Republican.

A Senate committee Friday approved legislation shifting the state’s university and community college pension costs onto the schools. It could save the state $18 million in its first year.

But the state’s annual payment is nearing $7 billion in the coming years, so those savings are paltry in comparison. It was rejected by the full Senate, so that proposal, too, is on hold.

It’s unclear with what level of urgency lawmakers will press on. When they make their next budget in 2014, their growing pension payment might not be their biggest financial problem.

Illinois’ 2011 income tax hike is set to expire in January of 2015, meaning the next state budget will face half a year without the increase’s revenue.

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Senate approves union-backed pension plan, setting up showdown with House

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Jack Franks
Elaine Nekritz
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