* Ralph Martire of the Center for Tax and Budget Accountability explains why he believes the current pension reform plans on the table are unconstitutional, but he also inadvertently helps point out why judges shouldn’t ever be included in the plan…
Back in the early 1980s the Illinois General Assembly was worried about the unfunded liability owed to the Judicial Retirement System. So to save some money and reduce that unfunded liability, it passed a law changing how a judge’s salary would be measured for purposes of calculating pension benefits.
This miffed a few justices, who sued claiming the change was a violation of Article XIII, Section 5 of the Illinois Constitution. That article provides: “Membership in any pension or retirement system of the state … shall be an enforceable contractual relationship, the benefits of which shall not be diminished or impaired.”
One of the named plaintiffs in this case, James Felt, showed that upon his retirement, the new computation would cause him to lose $3,187.44 in annual benefits. The state countered that its police power allowed it to impair contracts where the impairment was insubstantial and the state’s interest was compelling — in this case ensuring the fiscal viability of its underfunded judicial pension system.
While recognizing the state’s legitimate interest in ensuring the fiscal viability of its pension systems, the Illinois Supreme Court nonetheless struck down the legislation as an unconstitutional diminishment of a pension benefit.
In the process, the Felt Court rejected every single argument the state made. Indeed, the court maintained that doing otherwise would ignore the plain language of the Illinois Constitution, overrule prior Illinois Supreme Court decisions and run counter to the clear intent of the drafters of the Illinois Constitution.
As to this last point, the Supreme Court cited an explanation of Article XIII, Section 5 given by its author in the Record of Proceedings from the 1970 Constitutional Convention. That explanation plainly stated the intention of the provision was to prohibit the state from “changing the terms of” or “lessening” the pension benefits payable to workers “after they have embarked upon employment.”
I’m sure it also didn’t hurt that judicial salaries are protected by the Illinois Constitution…
Judges shall receive salaries provided by law which shall not be diminished to take effect during their terms of office. All salaries and such expenses as may be provided by law shall be paid by the State
But that diminishment clause also gives ample precedent for the pension language’s even broader language…
Membership in any pension or retirement system of the State, any unit of local government or school district, or any agency or instrumentality thereof, shall be an enforceable contractual relationship, the benefits of which shall not be diminished or impaired.