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Two dozen legislators aren’t signed up for a pension
Wednesday, Jan 23, 2013 * This trend is obviously not a positive one for public employee unions…
One of the things that the unions rely on is legislators voting to protect their own pensions and benefits. But the more opt-outs we get, the fewer legislators who will care. * Even so, some legislators who’ve opted out are still eligible for other pensions. For instance…
People have been predicting a Luechtefeld retirement for years. We may now know at least one reason why he’s decided to stick around. Luechtefeld is 72. * For some members, no pensions might mean even less turnover if they simply can’t retire. Simple “solutions” never produce simple results.
- Posted by Rich Miller
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- Billy - Wednesday, Jan 23, 13 @ 12:16 pm:
Does not matter! The legislation they put forth will go to the courts, and it will be ruled unconstitutional! Only an agreement with the unions, will avoid a negative ruling by the court!
- foster brooks - Wednesday, Jan 23, 13 @ 12:25 pm:
Most that refused are already receiving a pension or are in line for one.
- Rich Miller - Wednesday, Jan 23, 13 @ 12:27 pm:
===Most that refused are already receiving a pension or are in line for one. ===
Out of two dozen refuseniks, Lee Newspapers reported that three were getting another pension. That ain’t most.
- cassandra - Wednesday, Jan 23, 13 @ 12:28 pm:
Not good financial planning, I think. I’d be surprised if pension participation would be a deal breaker for most voters. The size of the pension, perhaps, given the decline in private sector pensions in the US in recent decades.
But I’m wondering-if they change their minds, can they buy back in?
- Eileen left - Wednesday, Jan 23, 13 @ 12:44 pm:
I wouldn’t vote for anyone dumb enough to refuse a pension. I wonder what their family thinks about refusing a benefit that would be of significance for them down the road.
- Rat - Wednesday, Jan 23, 13 @ 12:45 pm:
I am a State employee. Give us the money back that we paid in and let us opt out of our pension system. This pension system is a big Ponzi scheme. I don’t see this as one of our choices. Why not?????
- Rich Miller - Wednesday, Jan 23, 13 @ 12:46 pm:
===I am a State employee. Give us the money back that we paid in and let us opt out of our pension system. This pension system is a big Ponzi scheme. I don’t see this as one of our choices. Why not????? ===
I’m pretty sure you can do that today. Cash it in, opt out of the system.
- Fred's Mustache - Wednesday, Jan 23, 13 @ 1:20 pm:
===Only an agreement with the unions, will avoid a negative ruling by the court!===
Don’t think the unions have anything to do with it. The contractual obligation to pay pension benefits is not limited to union employees.
===I wouldn’t vote for anyone dumb enough to refuse a pension. I wonder what their family thinks about refusing a benefit that would be of significance for them down the road.===
Maybe some are refusing the pension because it WOULDNT be of significance down the road, and the political benefit of refusing the pension outweigh the benefits of accepting it. Legislators may have other business on the side or have other wealth to cover their families’ needs.
===I am a State employee. Give us the money back that we paid in and let us opt out of our pension system. This pension system is a big Ponzi scheme. I don’t see this as one of our choices. Why not?????===
Why in the world would you want to? Cmon man, look at what you put in over the years, and what you would serve to get at retirement from the system. Even IF your pension benefits are significantly reduced, your pension income would be far greater than the income you would gain from investing your returned contributions yourself.
- RNUG - Wednesday, Jan 23, 13 @ 1:31 pm:
Rich,
It depends on the system. If it’s one that allows self-directed or “cash balance” (believe that is only SURS and, maybe, TRS), the employee can opt to participant in that version of the state retirement fund. Don’t believe they can opt out completely while still employed.
For the typical SERS employee, as far as I know, there is no way to opt out of the defined benefit plan and keep working; you have to quit. And if you quit and withdraw from the system, all you get back is your original contributions … no interest, no match, none of the money the state was supposed to have been putting away for you. And unless you properly roll the money to an regular IRA, you’ll be paying both taxes and early withdrawal penalities. Definitely not a good financial choice if you have very many years in.
The only “good” thing about quiting is if you have also been contributing money to the State’s optional Deferred Compensation (457) plan. Last time I checked the rules on it, once you have left your government job, you can withdraw money from it without penalty regardless of age; just have to pay normal income tax.
- Formerly Known As... - Wednesday, Jan 23, 13 @ 1:32 pm:
Did not know that about Luechtefeld. That nugget only furthers my respect for him.
- wordslinger - Wednesday, Jan 23, 13 @ 1:49 pm:
You can’t deny those folks are putting their money where their mouth is. It might be a campaign tactic, but it’s one that costs you real money.
- Plutocrat03 - Wednesday, Jan 23, 13 @ 1:53 pm:
I kinda like the idea of the part time legislators not being eligible for a pension.
No other jobs have a pension or benefits for part time positions that I know about
- Cincinnatus - Wednesday, Jan 23, 13 @ 2:17 pm:
- Plutocrat03 - Wednesday, Jan 23, 13 @ 1:53 pm:
“I kinda like the idea of the part time legislators not being eligible for a pension.?”
Agreed. Just like any other part-time state or private worker, however in the case of the private company, it really is up to them.
- iThink - Wednesday, Jan 23, 13 @ 2:20 pm:
RNUG,
As far as I know there is no ‘cash-balance’ plan for TRS, just SURS.
- wordslinger - Wednesday, Jan 23, 13 @ 2:23 pm:
–No other jobs have a pension or benefits for part time positions that I know about–
You should get busy with the Cicero Township Republican Organization.
http://articles.chicagotribune.com/2010-05-25/news/ct-met-0526-cicero-benefits-20100525_1_cicero-president-larry-dominick-cicero-town-trustees-animal-welfare-board
- Allen Skillicorn - Wednesday, Jan 23, 13 @ 2:24 pm:
Where can we verify who is enrolled and who isn’t?
- Roadiepig - Wednesday, Jan 23, 13 @ 2:40 pm:
Not sure if I have this exactly right but… In the case of my new Rep. Sue Scherer, accepting a legislative pension would likely cause her to stop drawing her over $60,000 a year teacher’s pension (because she would be reentering the state workforce, or at least that’s the way it works in any SERS or recipricol government retirement system according to the SERS web site). Wouldn’t her accepting a new pension also make her subject to the tier 2 system and all of the lesser pension benefits, including higher retirement age ? Sounds like she is making the smart financial decision, even though she did tell reporters it was for “other” reasons.
- RNUG - Wednesday, Jan 23, 13 @ 2:45 pm:
iThink @ 2:20 pm
Thanks. That’s what I thought, but I wasn’t 100% sure.
- Arthur Andersen - Wednesday, Jan 23, 13 @ 3:22 pm:
RNUG has it right, Rich. Once on the payroll, any participant in a State pension system-TRS, SERS, and SURS is committed to membership in the System and may only receive one’s contributions by fully terminating service.
Oldsters may recall the “one-day resignation” game played by a number of folks in the 80s wherein they would resign, go off payroll for a day, withdraw their SERS money, and be reappointed to their job the next day. That loophole was securely closed shortly after the press found out.
- RNUG - Wednesday, Jan 23, 13 @ 4:28 pm:
AA @ 3:22pm
Forgot about that trick. If I remember right, they did it by having a gap between their 4 year term appointments.
- Anyone Remember? - Wednesday, Jan 23, 13 @ 4:33 pm:
Is there an actual list of which legislators aren’t participating, and then cross referenced against ALL public pension plans? (For example, Rep. Saicia is retired from the FBI, and Rep. David Harris is eligible for a military pension.)
The Reform Party in Canada (they eventually merged with another party) in 1993 had a class of 52 MPs that promised not to take a pension. Only 3 stuck with the promise. Just like the 1990s GOP Congressmen and term limits, this will eventually end (like John Shimkus).
- Arthur Andersen - Wednesday, Jan 23, 13 @ 4:44 pm:
RNUG, many of the one-day people were “4d3 exempt” (which may really show how old AA is) meaning they were exempt from certain provisions of the Personnel Code and were basically at-will employees. I think this predated term appointments, but could be wrong. I’m thinking 1982-83.
- Dirt Diver - Wednesday, Jan 23, 13 @ 4:56 pm:
Let’s also not forget that many of these new legislators that are rejecting a GARS pension are Tier 2 participants. The Tier 2 GARS benefits are fairly paltry. So the financial benefits that are being forfeit are probably worth the perceived political gain. Let’s see these new members give up other legislative perks that the public and media don’t fixate on.
- RNUG - Wednesday, Jan 23, 13 @ 5:26 pm:
AA,
Don’t remember for sure when term appointments came in. Now that I think about it, might have been a bit later.
- geronimo - Wednesday, Jan 23, 13 @ 6:06 pm:
It’s all very nice that these people are refusing to take a pension. Obviously, they have other means to support themselves in their later years. In the case of many public servants, if their pensions were severely cut the state would be paying for their financial welfare in a different manner………..food stamps and welfare. Many of these public employees never made enough money to save significant amounts for retirement. They thought that’s what their pension WAS! In my early years, one of my colleagues, whose wife was also employed in our field,——his 3 children qualified for free school lunches. Both parents working. So, most don’t have the luxury of saying no thank you to their earned pensions.
- Makandadawg - Wednesday, Jan 23, 13 @ 6:30 pm:
All this pension talk is not about the money. It is about who has political power over the money. The law is very clear. I earned my pension, give it to me. Remember, I was forced to give up my social security entitlements to join this pension system.
- thunder - Wednesday, Jan 23, 13 @ 6:43 pm:
If the state wants to change there benefit package when they hire someone for a position then, so be it. But, the employees that are already on board and was promised benefits, including a pension, must receive it or pay the consequences through the courts. It is not just for the union employee’s, it is for all state employees. Exempt included.
- Liberty_First - Wednesday, Jan 23, 13 @ 6:58 pm:
You cannot refuse to enroll in SURS as it is automatic.
- Anonymous - Wednesday, Jan 23, 13 @ 7:51 pm:
“Cicero Township Republican Organization”
Oi…. I hope there is a very special place in hell for those who abuse the public purse like these people.
- wordslinger - Wednesday, Jan 23, 13 @ 8:01 pm:
–“Cicero Township Republican Organization”
Oi…. I hope there is a very special place in hell for those who abuse the public purse like these people. –
It’s a trippy place.
Lot of hard-working people. Salt of the earth. The homes, in the Bungalow Belt, are magnificent, and will be there after the Pyramids are gone.
My old mother-in-law was treated like a queen when she retired, the township services were magnificent.
But the old-school vices are apparent on Roosevelt, Cermak and Ogden, too. Lot of money in those vices.
And The Outfit, whether it’s Betty, or Fast Eddie, or Larry, rule.
Don’t expect anyting better from Juan Ochao.
The Outfit hedges its bets. They can rob the place blind whether it’s Dominick or Ochao,
- wishbone - Wednesday, Jan 23, 13 @ 10:57 pm:
At the end of the day the courts will not mandate the tax increases necessary to meet future pension liabilities. Taxes are the exclusive prerequisite of the legislative branch, and no court will venture there, the state constitution notwithstanding. The pensions will ultimately be shorted by some percentage, there is no avoiding it. The best possible outcome is an across the board sharing of the needed cuts to minimize the pain to any one group of state beneficiaries.
- mushroom in the dark - Wednesday, Jan 23, 13 @ 11:18 pm:
Legislaters that refuse the pension also can and probably do elect not to pay into the system the 11.5 % of their salary required to be in the system. SURS also has an alternative 401 (k)type system with an 7.6% employer match that allows employees to not be in a defined benefit system.
So some of those refusing the pension also are not paying into it. This exacerbates the cash flow shortfall into the particular system.
- Smitty Irving - Thursday, Jan 24, 13 @ 12:26 am:
wishbone -
State courts, you are probably correct. Federal courts, maybe, maybe not. In 1969 Dick Oglivie had the courage to propose an income tax for Illinois. In PA, Milton Schapp did not, and the courts forced the issue. That was a few years ago, but could happen again.
- Health benefits - Thursday, Jan 24, 13 @ 1:22 am:
…. Now if they agreed to pay $500 - $700. Per month for their state subsidized health insurance as they voted for current retired state workers to do…. Now that would be something to write about.