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*** UPDATED x1 - Labor responds *** This just in… Speaker says “No” to summit, tells unions to get in the game

Wednesday, Jan 30, 2013

* 3:23 pm - The Illinois AFL-CIO has called for a pension “summit” next month, but House Speaker Michael Madigan has now declined to attend via a stinging letter to AFL-CIO President Michael Carrigan

Dear Mr. Carrigan:

I’d like to respond to your January 22, 2013 letter regarding the need to develop legislative solutions to address the underfunding of the state’s pension systems. Your interest in taking a more active role on this issue is welcome.

However, your suggestion of a meeting in Burr Ridge is not timely. A summit on this topic could have been called several years ago when we first started to grapple with this complex and controversial topic. A number of proposals have advanced since that time, but we have not been able to assemble the necessary bipartisan coalition to approve a plan that would stabilize the state systems for current and future retirees.

Your letter implies pension reforms faltered because the concerns of labor were not considered. In my view, the positions of organized labor were taken into account during the 2012 legislative session. I recall no fewer than eight high-level meetings that took place with labor, legislative leaders and the governor. At that time, I felt there was little willingness from representatives of labor to draft a comprehensive, common-sense solution.

The residents of Illinois have been asked to shoulder a higher tax burden in recent years. For several years, Illinois has had to address very serious issues, including rising pension, Medicaid and state healthcare costs, all of which have contributed to the state’s massive budget pressures. The state has reduced spending in many areas, but costs for pensions continue to increase and unions representing state employees insist that salaries be increased. Many state lawmakers understand the difficult situation before us, having voted to cut their own legislative pay the last four years.

To date, we have received no cooperation from the labor unions representing state employees on addressing these challenges. In fact, these unions often have been strongly opposed to any attempt to solve the problem. For example, AFSCME recently said it will not ratify a contract that decreases the take-home pay of its employees.

It is worth noting a recent editorial points out that of the 12 most populous states, Illinois has the fourth highest average state worker pay, including overtime, and information from the U.S. Bureau of Labor Statistics and Kaiser Family Foundation shows that Illinois state workers pay significantly less for their insurance premiums than those in the private sector.

It is time for labor to come to the table with an honest proposal that recognizes the state’s serious fiscal condition and puts government employees on par with those in the private sector relative to a benefits package.

One measure introduced in the 98th General Assembly, House Bill 98 sponsored by Rep. Elaine Nekritz, includes a series of proposals that would put Illinois on a path to preserving the state’s pension systems. We must also look for fresh ideas to end the practice of state payments for non-state workers. I look forward to your thoughts on both topics.

I look forward to your announcement of support of reforms that helps the state address its budget pressures and preserves the pension systems for the employees counting on them. Please feel free to contact me if you have any questions.

With kindest personal regards, I remain

Sincerely yours,

MICHAEL J. MADIGAN
Speaker of the House

Emphasis is in the original.

*** UPDATE *** From the We Are One Coalition…

The following statement is attributable to Michael T. Carrigan, president of the Illinois AFL-CIO, speaking on behalf of the We Are One Illinois coalition:

We Are One Illinois regrets that Speaker Madigan has indicated he will not participate in the Pension Summit proposed by our union coalition. Our summit is a demonstration of good faith and commitment to seeking to solve the state’s pension funding problem in a way that is fair and constitutional.

Our coalition has already put forward a plan that addresses the intertwined problems of inadequate revenues and underfunded pensions. It would end the practice of politicians shorting actuarially required payments to the retirement funds; ease state budget pressures by closing wasteful tax loopholes, especially for big corporations; and require active public employees to pay more toward the pensions they earn and rely on. Our plan would provide at least $2.35 billion a year to stabilize the retirement funds, while preventing cuts to retirees who worked hard and played by the rules.

The We Are One Illinois plan has the potential to be a starting point for participatory discussions around a pension-funding solution. Crucially, we believe that pension legislation supported by all parties is the only way to meet constitutional muster and avert costly and time-consuming court battles.

In downgrading Illinois credit last week, Standard and Poor’s warned that unconstitutional pension cuts “risk … legal challenges” that could take “several years” to resolve, delaying “improved funded ratios and budget relief.” Illinois doesn’t have years to waste. The We Are One Illinois coalition of unions remains ready to work constructively on this problem right now.

We have pointed out that the public employees and retirees represented by our unions are helpers and problem-solvers by trade—the teachers, the caregivers, the protectors and those who respond in emergencies. They are committed to being a part of the solution to the pension problem as well, but they can’t do it alone.

We were particularly surprised and disappointed that the Speaker singled out state employees from our coalition—which includes teachers, police, fire fighters, nurses, caregivers and many others—and decried their efforts to maintain decent wages and affordable health care. In terms of comparison to other states, it is true that Illinois state employees are fairly paid—just as are other public employees , and indeed unionized private sector workers in our state. Illinois is a relatively high-wage state and all of our citizens are the better for it. Further, when comparing benefits to private-sector workers, it must be noted that nearly 80 percent of Illinois public employees—including teachers, police, fire fighters and university employees—are not eligible for Social Security. Finally, every serious, academic study has shown that public employees are paid less in wages and earn less in total compensation than comparable private-sector workers with similar jobs and educational attainment.

On the pension issue, the Speaker is correct to recall a series of discussions involving the union coalition, legislative leaders and the governor nearly one year ago. We were disappointed when those discussions were abruptly halted by the elected officials last spring, and despite our invitations throughout the ensuing months, never resumed. Our Feb. 11 Pension Summit is an opportunity to get back to work.

The people of Illinois want and deserve leaders who work together to solve problems. The public employees and retirees who serve the people need and depend on the modest pensions they earn and pay into from every check. A pension-funding solution that is constitutional, sustainable and fair requires openness and dialogue from all parties.

- Posted by Rich Miller        


100 Comments
  1. - bored now - Wednesday, Jan 30, 13 @ 3:30 pm:

    wow…


  2. - Stooges - Wednesday, Jan 30, 13 @ 3:31 pm:

    “We must also look for fresh ideas to end the practice of state payments for non-state workers”

    What is the Speaker referring to here?


  3. - OneMan - Wednesday, Jan 30, 13 @ 3:34 pm:

    drops mic…


  4. - Rich Miller - Wednesday, Jan 30, 13 @ 3:35 pm:

    ===What is the Speaker referring to here?===

    Cost shift.


  5. - Oswego Willy - Wednesday, Jan 30, 13 @ 3:39 pm:

    ===With kindest personal regards, I remain

    Sincerely yours,

    MICHAEL J. MADIGAN
    Speaker of the House===

    Enough said.


  6. - Billy - Wednesday, Jan 30, 13 @ 3:39 pm:

    Looks like the sides are getting ready for the big battle ahead! Give and take, do not count on it. Looks like hard ball from both sides!


  7. - MOON - Wednesday, Jan 30, 13 @ 3:41 pm:

    As I stated earlier this week, I believe the Speaker will introduce legislation soon that will deal with the pension issue but also put the SEIU and AFSCME in a rage.

    The unions are about to feel the rage of the Speaker.


  8. - hisgirlfriday - Wednesday, Jan 30, 13 @ 3:42 pm:

    So Illinois has the 4th highest average state worker pay INCLUDING OVERTIME, but didn’t some AP report in the last couple years also say that Illinois had the fewest state workers per capita?

    So couldn’t it be that Illinois state workers are getting more pay because they’re doing more work?

    And wouldn’t overtime pay decrease pension costs more than hiring additional workers? So if the unions are allowing more overtime work by their workers, aren’t they working to decrease pension costs?


  9. - Dirt Diver - Wednesday, Jan 30, 13 @ 3:42 pm:

    Subtext -

    Dear Labor,

    Thanks for allowing me to use the State’s pension funds as an indirect way to print money to help fund programs/services (and your salary increases)so that my fellow democrats would win enough seats for me to keep the House for 30 years.

    Oh and by the way, none of your counterproposals would reduce enough liability and I’m sure as heck not Constitutionally binding myself to a guaranteed state contribution schedule, so we will continue to ignore your suggestions/offers.

    Where else are you going to go? You can’t go to the GOP, you can’t trust Quinn - he stole over 1/2 a mil from you in 2010.


  10. - dupage dan - Wednesday, Jan 30, 13 @ 3:47 pm:

    Are we sure this letter wasn’t written by Wisconsin governor Scott Walker?

    Fiscal crises should know no political party.

    As a state employee I implore the union to realize reality and move from their untenable position before the rank and file end up getting handed their hats.


  11. - Diogenes in DuPage - Wednesday, Jan 30, 13 @ 3:48 pm:

    It sounds as though MJM is finally ready to take AND HOLD leadership on the pension legislation this spring. With the Dems controlling both houses and the Governor’s chair, where can Big Labor go if they want a sympathetic ear? MJM will put on his white hat, mount the white steed of Pension Saviorship, and “save” the state from the continuing financial nightmare known as our pension system underfunding. (Remind me again of which politician has been a constant in Springfield leadership since the 1970 Constitutional Convention guaranteeing pension rights?)


  12. - Endangered Moderate Species - Wednesday, Jan 30, 13 @ 3:51 pm:

    Very well said, MM.


  13. - Formerly Known As... - Wednesday, Jan 30, 13 @ 3:54 pm:

    Et tu, Brutus?


  14. - LincolnLounger - Wednesday, Jan 30, 13 @ 3:56 pm:

    Overtime is the key — particularly Corrections.


  15. - RNUG - Wednesday, Jan 30, 13 @ 3:59 pm:

    Sounds the GA is going to railroad something, anything regradless of legality and let the courts sort it out.


  16. - Rod - Wednesday, Jan 30, 13 @ 3:59 pm:

    To be honest if I had gotten that letter from the Speaker I would have had heart palpitations.


  17. - Nickypiii - Wednesday, Jan 30, 13 @ 3:59 pm:

    Can you say cost shift for teacher pensions!


  18. - DINO - Wednesday, Jan 30, 13 @ 4:00 pm:

    Wow. It looks as if Madigan is finally serious about the fiscal disaster we are facing. Maybe a veto proof majority will be a good. Yeah, probably not.


  19. - Amalia - Wednesday, Jan 30, 13 @ 4:00 pm:

    he bugs me in lots of ways, but why doesn’t Mike run for govern? this letter is pretty interesting.


  20. - Billy - Wednesday, Jan 30, 13 @ 4:00 pm:

    The Illinois Constitution and the courts is where this is headed!


  21. - Responsa - Wednesday, Jan 30, 13 @ 4:04 pm:

    ==The unions are about to feel the rage of the Speaker.==

    Perhaps some of the more savvy union members will now start looking a little closer at their own leadership over the past few decades–consider what’s been peddled to them as members, and access whether they’ve gotten their money’s worth out of their years of dues.


  22. - Louis Howe - Wednesday, Jan 30, 13 @ 4:06 pm:

    AFSCME is their own worst enemy. A newly hired correctional guard, between June 2004 and July 2011, received a 77% increase in base pay. IDOC’s employees received annual cola and step increases of 6% while the underlying state revenues grew at less than 3%. That’s unsustainable!!!


  23. - Paul Lyin - Wednesday, Jan 30, 13 @ 4:08 pm:

    Got to attempt to get something done before Lisa comes into the Gov’s mansion.

    Deep down, Madigan wants to get something done on this. I’m sure he made it clear to labor, agree on meaningful/signficant reforms or else I’m ramming it down your throat.

    Labor has had plenty of time to offer up their “bottom-line deal”. Had the offered up meaningful reform before January 9th, he may have listened. Now with a new, more “fiscally conservative - tea-party sympathetic House” a more draconian bill will pass, then struck down by the Courts.


  24. - Fair Share - Wednesday, Jan 30, 13 @ 4:11 pm:

    Responsa - right on target - The union leaders have long been party to the “bargin” of continuous pay raises (above CPI) at the expense of shorting the pension funds of their needed level of employer contributions.


  25. - Oh Yeah - Wednesday, Jan 30, 13 @ 4:17 pm:

    Mike Carrigan and the teacher and public employee unions need to realize something; although Quinn might seem like their enemy and he’s easy for them to demonize, MJM and Cullerton are about to seem just as much their enemies, if not more so. The “Pension Pain Train” is leaving the station and about to come down the legislative tracks and state employees and their unions are about to get run over by it.


  26. - MrJM - Wednesday, Jan 30, 13 @ 4:21 pm:

    The union leaders have long been party to the “bargin” of continuous pay raises (above CPI) at the expense of shorting the pension funds of their needed level of employer contributions.

    I’d long wondered how facts and logic could be contorted to blame the unions for the legislature’s under-funding of their pensions.

    – MrJM


  27. - Anonymous - Wednesday, Jan 30, 13 @ 4:25 pm:

    No question that union leadership is out of their minds. Recently they asked if we would support a strike on behalf of their lame negotiating skills. Why don’t they ask for a referendum on their leadership…..


  28. - Fair Share - Wednesday, Jan 30, 13 @ 4:28 pm:

    MrM

    Now you know.

    Fact - union leaders asked for raises fit their members
    Fact - raises exceeded growth in revenues

    Logic- the money had to come from somewhere. That somewhere was shorting pensions.


  29. - law abiding citizen - Wednesday, Jan 30, 13 @ 4:28 pm:

    I expect something will get rammed through and then found unconstitutional by the courts. It seems clear the legislature wants to test the strength of the Constitution. It seems clear the union expects the Constitution will prevail. By then we’ll all be looking at crazy high taxes to get out of this mess. I don’t see how this can end well for anyone.


  30. - walkinfool - Wednesday, Jan 30, 13 @ 4:34 pm:

    Justified response.

    It always burns me that after multiple public and private meetings between interest groups and the GA leaders, committees, and members, that when the groups don’t get exactly what they want, they claim they had no input, and demand a summit.

    They mislead both their own members, and the public with this tactic.

    Just because a bill does not agree with your positions, does not mean that you weren’t consulted, and your positions weren’t seriously considered.


  31. - Downstate Dem - Wednesday, Jan 30, 13 @ 4:37 pm:

    Seems like state employees are not getting the best from their leaders. There’s going to be major changes because the fiscal condition changed. Either they could be part of the solution or be the adversary, and take whatever comes now.


  32. - Louis Howe - Wednesday, Jan 30, 13 @ 4:38 pm:

    MrJM….Actually, Fair Share, is correct….AFSCME would bargain first for increased pension benefits, and secondarily for full funding annual state contributions. “Don’t worry about funding,” AFSCME’s lobbyist would say, “the Illinois constitution guarantees our benefits.”


  33. - formerGOPer - Wednesday, Jan 30, 13 @ 4:43 pm:

    Finally! Hope he really means it. It’s about time someone started comparing state employees wages, benefits, and pensions to what the average worker in the state gets rather than to other states. It’s those other workers that pay the bills. (NOTE: sometimes I’m not so much a former GOPer but I am a retired state employee and I’m willing to take a hit.)


  34. - SAP - Wednesday, Jan 30, 13 @ 4:44 pm:

    ===What is the Speaker referring to here?===

    Cost shift.

    Isn’t this highly paid union officials participating in SERS based on union salary?


  35. - Meaningless - Wednesday, Jan 30, 13 @ 5:03 pm:

    You gotta love it !!! “With kindest personal regards” … but take a hike!


  36. - geronimo - Wednesday, Jan 30, 13 @ 5:04 pm:

    ==It’s those other workers that pay the bills==

    Where have I missed something? Public employees pay real estate taxes for schools and services just like you do. They pay state tax just like you do. AND they paid into their pension fund and got their money taken and used on everybody and now there’s a shortage in THEIR pot. Get your story straight.


  37. - Sunshine - Wednesday, Jan 30, 13 @ 5:11 pm:

    When you think you have a strong hand and time on your side, you can play hard ball; But, when you finally realize you do not have a strong hand and time has run out you swallow hard, turn red, and look around to see who you can blame. Unfortunately the room is full of mirrors.

    Of course you can call a strike and shut down the entire system and then wait for the riots. It might look like Greece but it will be Chicago.

    Everyone is going to take a hit on this and Madigan is playing it masterfully. A hell of a letter and shot across the union bow.


  38. - wordslinger - Wednesday, Jan 30, 13 @ 5:13 pm:

    Whenever Madigan releases a letter, I get the impression that he writes with a scalpel.

    Sharp. To the gut.


  39. - Not It - Wednesday, Jan 30, 13 @ 5:20 pm:

    I once got a letter from the Speaker. The body of the letter was one-sentence in length. It was both awe-inspiring and horrific at the same time.


  40. - Meaningless - Wednesday, Jan 30, 13 @ 5:44 pm:

    “All wars are a sympton of man’s failure as a thinking animal.” - John Steinbeck


  41. - Jechislo - Wednesday, Jan 30, 13 @ 5:46 pm:

    This is such a ruse. The Illinois Constitution protects current employees/retirees from decreases in their pension benefits and Madigan (Mike) knows that. This does nothing but kick the can down the road another 2 years while (hoping) to placate the Bond interest rate folks.

    This will end up being settled by Madigan (Mike)and Madigan (as in MS. Governor) and someinconsequentialDemocraticperson in the Senate after what they are now proposing is invalidated by the Illinois Supreme Court.

    What a joke of a State we live in. The Democrats won all three Legislative Branches so it’s time for them to man up and fix what they’ve ignored for a long, long time. And, yes, the Republicans also need to be brought into the foray - as long as what they think on this issue is considered. The Republicans aren’t going to lock-step go along with whatever Mike throws out like his Democratic soldiers will, but they need to be brought into the discussion.

    The Democrats now hold ALL of the power. They need to come up with a workable solution.


  42. - Emily Booth - Wednesday, Jan 30, 13 @ 5:50 pm:

    Why would a union negotiate for lower take home pay? And, it’s untrue that AFSCME did not cooperate in helping the state with its budget woes. I don’t think Madigan wants anyone at the table.


  43. - Meaningless - Wednesday, Jan 30, 13 @ 6:02 pm:

    To Emily - What table? It looks like Madigan has decided there will not be a table!


  44. - steve schnorf - Wednesday, Jan 30, 13 @ 6:04 pm:

    I don’t want to wish ill on anyone,but I’m not sure that AFSCME gets it that this isn’t like negotiating a contract, where you put offers on the table and wait for counter-offers. Remember what happened to them on Tier 2; they waited too long ans were too insistent and got it shoved down their throats in 24 hours.

    I know that it is counter-intuitive to them to bargain against themselves by not just leaving their last offer on the table awaiting a response, but I think the clock is running out. I’ve seen communications like this from the Speaker before, and I would suggest it be taken very seriously.


  45. - RNUG - Wednesday, Jan 30, 13 @ 6:12 pm:

    The ‘pension fix’ is really a ‘bond fix’. This little bit of language is buried in SB0001 (and was in amendment 11 last session).

    6 Any payments required to be made by the State pursuant to
    7 this subsection (c) are expressly subordinated to the payment
    8 of the principal, interest, and premium, if any, on any bonded
    9 debt obligation of the State or any other State-created entity,
    10 either currently outstanding or to be issued, for which the
    11 source of repayment or security thereon is derived directly or
    12 indirectly from tax revenues collected by the State or any
    13 other State-created entity. Payments on such bonded
    14 obligations include any statutory fund transfers or other
    15 prefunding mechanisms or formulas set forth, now or hereafter,
    16 in State law or bond indentures, into debt service funds or
    17 accounts of the State related to such bonded obligations,
    18 consistent with the payment schedules associated with such
    19 obligations.

    Notice it refers to both past and FUTURE state debt.

    Ironically, this is one of the few items in the bill that will likely pass constitutional muster if/when it ends up severed from the rest of it.


  46. - cassandra - Wednesday, Jan 30, 13 @ 6:14 pm:

    I don’t know. AFSCME it’s own worst enemy? It’s their job to get the best deal they can for their members. Public employee unions are not the fourth branch of government, although living in Illinois, it may seem that way.

    The problem in Illinois appears to have been the incompetence and worse of the state’s executive and legislative branches when all these salary increases and retirement and other perks were negotiated over the decades. And ultimately, of course, of we residents who weren’t paying attention because we figured it wouldn’t affect us much as individuals.

    Not sure what AFSCME has to lose in letting Quinn, Madigan et al. impose something and let the courts decide. Unions don’t have to face the voters–only their membership. In fact, letting the courts decide is probably looking more and more appealing to all the parties. The rest is grandstanding.


  47. - Makandadawg - Wednesday, Jan 30, 13 @ 6:17 pm:

    So there it is, Illinois politics at it’s best. The game is all about who wins and who loses. Forget about anything else that really matters.


  48. - soccermom - Wednesday, Jan 30, 13 @ 6:18 pm:

    Let’s not get too carried away with the “low number of state employees per capita” statistic. Keep in mind, those other states don’t have the levels of township government that we do, so state employees provide those services. Similarly, Cook County staffs hospitals and clinics; in other states, those medical services are provided by state employees.

    I’m not saying that state employees don’t work hard, and I know that staffing levels are kind of grim in many agencies. Let’s just make sure we are comparing apples to apples.


  49. - wishbone - Wednesday, Jan 30, 13 @ 6:22 pm:

    I really feel sorry for state employees who think that massive tax hikes are in the offing to solve the pension problem. In the end a mix of current program cuts, modest pension cuts, a COLA actually linked to the cost of living, and increased health insurance contributions will be needed. The courts are simply not in a position to take over the roles of the executive and legislative branches of government, and ultimately they won’t even try.


  50. - railrat - Wednesday, Jan 30, 13 @ 6:49 pm:

    OK lets see how the bogus “lunchpail republicans” respond to this ? its not just AFSCME in public sector representation… on one hand the union(150) side gives PQ,JC & MM $$$$$$$$$$$$$ yet on the other they play “defied” regarding what Gov. Daniels did to the union in Indiana after supporting him with the same $$$$$$$$$$$$ over his entire career,or does the “gun issue” overtake they’re obligation to the membership ??? curious huh


  51. - steve schnorf - Wednesday, Jan 30, 13 @ 6:56 pm:

    yes, well, there’s that, of course. ?????


  52. - rat - Wednesday, Jan 30, 13 @ 6:58 pm:

    It would be nice to get out of this pension system. See below.

    Some math to think about
    Assumptions
    45 years old/$85,000 per year/16 years for the state.
    $45,000. Estimated pension with interest
    Retire at age 65 (20 more years)
    $45,000 (Base Amount)
    8% Interest (What the pension system calculates as rate of return)
    $5,100-Annual deposit (6% of salary invested per year) Employees pay 4% State wants 2% more
    You would have $473,708 with your name on it. If you also saved 6% of your own money, you would have $725,711 with your name on it.
    What if you started at 30 years old?
    The state wants to start paying pension when you are 65 and not give cost of living increases. I could live on $725,000 with deferred compensation. Also, this would be a choice therefore constitutional. The state would get rid of future pension liabilities and we could actually plan for our future. Sweet!!!!


  53. - Responsa - Wednesday, Jan 30, 13 @ 6:59 pm:

    What does the term ” bogus lunchpail republican” mean?


  54. - Jimbo - Wednesday, Jan 30, 13 @ 7:00 pm:

    A COLA that is half of chained CPI is not linked to the cost of living. Especially when it is capped at 750 bucks.


  55. - Quipper - Wednesday, Jan 30, 13 @ 7:17 pm:

    Madigan has to posture himself. After all, he has to get his daughter elected as Governor doesn’t he?


  56. - Bob - Wednesday, Jan 30, 13 @ 7:34 pm:

    Back in 1970 during the constitutional convention. There was mention of the Pension’s not being funded by $2,200,000,000. So 43 years later, its a problem? Speaker Madigan supported the Pension protection clause then. Start reading on page 2926

    http://www.idaillinois.org/cdm/compoundobject/collection/isl2/id/7417/rec/1


  57. - rat - Wednesday, Jan 30, 13 @ 7:36 pm:

    “What does the term ” bogus lunchpail republican” mean?”

    If you are young why would you ever want to be in a broke pension system. The state should do the right thing and let the young people out of this ponzi scheme. Last one in = no money left. The math does not add up. 8% estimated return when the 10 year bond is at 2%. Really? MM should give us a option to get out. Some how they have a way to get out. Please give us one. Thank You


  58. - wordslinger - Wednesday, Jan 30, 13 @ 7:39 pm:

    –What does the term ” bogus lunchpail republican” mean?–

    I like it a lot, it rings like a church bell to me. Cuts through a lot of static.

    I would love to work on my definition and offer it up, but I, too, want to hear from the author.

    Awesome.


  59. - Meaningless - Wednesday, Jan 30, 13 @ 7:42 pm:

    A very informative chart was put together that showed very clearly that a retiree receiving a fixed 3% COLA actually lost purchasing power over the last 3 decades when compared against the CPI. A 3% COLA is a nice increase when inflation is 1%, but what about those years when inflation hits double digits? I’ve been there!


  60. - citizen - Wednesday, Jan 30, 13 @ 8:05 pm:

    I remember several years ago, the budget was “fixed” by offering state employees opportunities to “buy” additional years towards retirement, which allowed them to take early retirement. Massive numbers of people took advantage of that. Now we’re surprised that what’s being paid from the retirement system to these people who would otherwise have possibly worked 5-10 additional years is breaking the bank???


  61. - Norseman - Wednesday, Jan 30, 13 @ 8:21 pm:

    Lets get something to the courts and see if the Illinois Constitution has any real meaning. I’m tired of all the rhetoric and public employee bashing.


  62. - Arthur Andersen - Wednesday, Jan 30, 13 @ 8:21 pm:

    -he writes with a scalpel-

    As always, well said, word. That daily apple peeling keeps him in practice.

    Union HQs are not going to be happy places tomorrow.

    RNUG, that language is a given. No payments are ever going to get in front of debt service or we won’t sell any bonds. With or without this, the “ironclad guarantee” is still shaky IMHO.


  63. - Roadiepig - Wednesday, Jan 30, 13 @ 8:23 pm:

    “We must also look for fresh ideas to end the practice of state payments for non-state workers”

    This could also be read as eliminating health insurance for retiree’s non-state employee spouses too, couldn’t it Rich? Hasn’t that been one of the stumbling blocks in the union contract negotiations?


  64. - Oswego Willy - Wednesday, Jan 30, 13 @ 8:31 pm:

    (waiting on definition of “Bogus Lunchpail Republicans” from the author & - wordslinger - before posting further)


  65. - Anon - Wednesday, Jan 30, 13 @ 8:39 pm:

    Why is the Speaker afraid to talk about an issue? Think about it. A summit is about talking, that’s it. What is so scary that the Speaker cannot show up to talk about an issue. I wonder if the Civic Committee invited him, would he show up? HMMMMM


  66. - Oswego Willy - Wednesday, Jan 30, 13 @ 8:45 pm:

    -Anon -,

    MJM thinks 8 meetings was enough, so DO something is the order of the day.


  67. - Arthur Andersen - Wednesday, Jan 30, 13 @ 8:48 pm:

    Willy, do you think that dude means us with the Bogus whatchamacallit stuff?


  68. - Oswego Willy - Wednesday, Jan 30, 13 @ 9:01 pm:

    - AA -,

    Either it’s a “shot” at Reagan Democrats… or a garage band I heard when I bought a $5 red solo cup during college.

    Both have equal weight at this moment!

    Or I am totally off, which is possible too…

    My “brain” hurts now…


  69. - Oswego Willy - Wednesday, Jan 30, 13 @ 9:07 pm:

    I hope he means us, then I know what to call me… I love labels and stuff.

    Sorry, -AA -, this part was cut off when I typed the above.

    Should we get Softball jersey with that as a “team name” or pocket protectors bedazzled with it?

    My brain still hurts…


  70. - gg - Wednesday, Jan 30, 13 @ 9:12 pm:

    The Die is Cast

    Health insurance = low coverage and high cost for all.

    No raises for employees until June 2018.

    Additional contributions to the pension
    1% a year for 2 or 3 years.

    Cost shift to the Universities and local schools.

    Some indexed COLA change

    A cap on salary contributions over $ 100K.

    There will be a mediated settlement in the court after a few years. State will pay pennies on the dollar. Everything will be swept under the rug.


  71. - RNUG - Wednesday, Jan 30, 13 @ 9:15 pm:

    AA,

    so some contracts (bonds/debt) are more equal than other contracts (pensions)?


  72. - Coach - Wednesday, Jan 30, 13 @ 9:16 pm:

    === What does the term ” bogus lunchpail republican” mean? ===

    Reportedly, they’re an extension of Local 150:

    http://www.huffingtonpost.com/2012/10/01/lunch-pail-republicans-labor_n_1929825.html

    http://www.lunchpailrepublicans.com/site/


  73. - Oswego Willy - Wednesday, Jan 30, 13 @ 9:21 pm:

    Thanks, - Coach -


  74. - Oswego Willy - Wednesday, Jan 30, 13 @ 9:26 pm:

    - railrat -,

    No snark. How should Lunchpail Republicans should react? According to the HuffPost article, & your thoughts, what should be the response be to NOT bogus?

    Respectfully


  75. - Former Merit Comp Slave - Wednesday, Jan 30, 13 @ 9:27 pm:

    Madigan refers to HB98 which, as a state employee, I think is the perfect compromise. However I don’t think it will pass constitutional muster as written. MJM is no dummy, does he not read Ralph? I still think that is the bulk of the solution.


  76. - Oswego Willy - Wednesday, Jan 30, 13 @ 9:28 pm:

    …and I hate iPhone auto correct.

    Thanks.


  77. - Madigan Shmadigan - Wednesday, Jan 30, 13 @ 9:32 pm:

    What a hypocritical joke he is. After all, he’s the one (for all intent and purposes) who bartered and blessed every fiscal budget for the last 30 years. Nothing gets done without Shmadigan’s approval. So I say Mikey, its time you accept the blame rather than putting it on the backs of the state employees.

    Illinois has the fewest state employees of any state in the country. His statement that state employee wages are too high compared to rest of the working force is partially true. The higher wages are primarily due to overtime issues from being grossly understaffed.

    Belly up Mr.Shmadigan . . . . you were one of the biggest contributors to this mess!


  78. - Ruby - Wednesday, Jan 30, 13 @ 9:42 pm:

    “Illinois state workers pay significantly less for their insurance premiums than those in the private sector.”

    Mr. Madigan is telling us that pension reform must include reduced health care benefits. We already know that he wants to include the cost shift for public schools and state universities.


  79. - Roadiepig - Wednesday, Jan 30, 13 @ 9:54 pm:

    Thanks for your comment Ruby- that’s what I got from his letter too. Not looking good for the retirees now…


  80. - steve schnorf - Wednesday, Jan 30, 13 @ 10:23 pm:

    The Speaker is obviously correct in what he says about state employee health insurance premiums. It’s easy for me to say that they probably should be paying about 20% of their own premiums, and 40-50% of their dependents premiums. However, I could never get to anywhere near that in bargaining.

    As for Retirees, we should be paying something, and I think we will.

    Far better to make a deal on things like this than to roll the dice, but I don’t see a lot of progress.


  81. - Retired Prof - Wednesday, Jan 30, 13 @ 10:44 pm:

    - rat - Wednesday, Jan 30, 13 @ 6:58 pm:
    It would be nice to get out of this pension system. See below.
    Some math to think about
    Assumptions
    45 years old/$85,000 per year/16 years for the state.
    __________
    Wow, I should have been a rat instead of a professor.


  82. - wordslinger - Wednesday, Jan 30, 13 @ 11:34 pm:

    === What does the term ” bogus lunchpail republican” mean? ===

    Reportedly, they’re an extension of Local 150:–

    Coach, I think you got it. Thanks.

    Todd, is that you? Don’t hide your light under a bushel, cousin.

    Lunchpail Republicans. Great general idea, like Reagan Democrats.

    But to make it really work, much more Lugar, and absolutely NO Walsh.

    http://www.opensecrets.org/outsidespending/recips.php?cmte=C00515593&cycle=2012


  83. - wordslinger - Wednesday, Jan 30, 13 @ 11:55 pm:

    –Far better to make a deal on things like this than to roll the dice, but I don’t see a lot of progress.–

    If health insurance is put on the table, you best make the deal.

    If you think folks, irrationally so, are down on pensions, don’t even get them started on health insurance costs.

    Everybody — big business, small business, self-employed, workers — in the private sector has been getting pounded by health insurance costs for years. No raises for the average schmuck, no profits for small business, just higher insurance premiums.

    Despite all the weirdness about Obama/RomneyCare, we haven’t even begun to address this issue.

    As a society, healthcare costs are the ballgame, and paying less for it while maintaining the benefits of medicine’s great advances, for everyone, are absolutely the ballgame.

    No problemo, lol.


  84. - Pink E. Kent - Thursday, Jan 31, 13 @ 12:14 am:

    Dear Mr. Carrigan:

    I’d like to respond to your January 22, 2013 letter regarding the need to develop legislative solutions to address the underfunding of the state’s pension systems. Your interest in taking a more active role on this issue is welcome.

    However, your suggestion of a meeting in Burr Ridge is not timely. A summit on this topic could have been called several years ago when we first started to grapple with this complex and controversial topic. A number of proposals have advanced since that time, but we have not been able to assemble the necessary bipartisan coalition to approve a plan that would stabilize the state systems for current and future retirees.

    Your letter implies pension reforms faltered because the concerns of labor were not considered. In my view, the positions of organized labor were taken into account during the 2012 legislative session. I recall no fewer than eight high-level meetings that took place with labor, legislative leaders and the governor. At that time, I felt there was little willingness from representatives of labor to draft a comprehensive, common-sense solution.

    The residents of Illinois have been asked to shoulder a higher tax burden in recent years.

    For several years, Illinois has had to address very serious issues, including rising pension, Medicaid and state healthcare costs, all of which have contributed to the state’s massive budget pressures. The state has reduced spending in many areas, but costs for pensions continue to increase and unions representing state employees insist that salaries be increased. Many state lawmakers understand the difficult situation before us, having voted to cut their own legislative pay the last four years.

    To date, we have received no cooperation from the labor unions representing state employees on addressing these challenges. In fact, these unions often have been strongly opposed to any attempt to solve the problem. For example, AFSCME recently said it will not ratify a contract that decreases the take-home pay of its employees.

    It is worth noting a recent editorial points out that of the 12 most populous states, Illinois has the fourth highest average state worker pay, including overtime, and information from the U.S. Bureau of Labor Statistics and Kaiser Family Foundation shows that Illinois state workers pay significantly less for their insurance premiums than those in the private sector.

    It is time for labor to come to the table with an honest proposal that recognizes the state’s serious fiscal condition and puts government employees on par with those in the private sector relative to a benefits package. One measure introduced in the 98th General Assembly, House Bill 98 sponsored by Rep. Elaine Nekritz, includes a series of proposals that would put Illinois on a path to preserving the state’s pension systems. We must also look for fresh ideas to end the practice of state payments for non-state workers. I look forward to your thoughts on both topics.

    I look forward to your announcement of support of reforms that helps the state address its budget pressures and preserves the pension systems for the employees counting on them.

    Please feel free to contact me if you have any questions.

    With kindest personal regards, I remain

    Sincerely yours

    MICHAEL J. MADIGAN

    Speaker of the House


  85. - wordslinger - Thursday, Jan 31, 13 @ 12:18 am:

    –If you are young why would you ever want to be in a broke pension system. The state should do the right thing and let the young people out of this ponzi scheme.–

    Dude, be careful what you wish for.

    Some facts:

    The state has never missed a pension payment. And despite the hype.

    The state’s a going concern, you see.

    Now if you want to go into a 401K, be my guest. From personal experience, good years and bad.

    But after September 2008, it took about 4 years to slug it back to even. And that wasn’t guaranteed.

    Like I said, don’t believe the hype.


  86. - RNUG - Thursday, Jan 31, 13 @ 1:10 am:

    steve,

    Even if the union made such a deal, they wouldn’t represent the MC retirees. And I actually have some question as to whether the union(s) could legally represent any of the retirees, even the former union members. It’s never been challenged that I can find but I don’t think it would hold up if challenged.

    OTOH, the health insurance percentage numbers you tossed out are much more reasonable than the numbers I’ve heard proposed by the current administration. I could live with them. But I’d want an independent non-government third-party audit on any number CMS came up with.


  87. - Anonymous - Thursday, Jan 31, 13 @ 5:38 am:

    “Wow, I should have been a rat instead of a professor.”

    Or maybe a highly trained professional with several degrees and certification that works a full year.


  88. - Oswego Willy - Thursday, Jan 31, 13 @ 7:26 am:

    ===Lunchpail Republicans. Great general idea, like Reagan Democrats.===

    Agreed.

    Reagan Democrats and Lunchpail Republicans can get a great deal done - in theory.

    Thanks - Coach - for dropping some knowledge.


  89. - truthteller - Thursday, Jan 31, 13 @ 7:26 am:

    Maybe if the AFL-CIO could get John Boehner to attend the summit, Madigan would show up. He did make an appearance when CME hosted Boehner, and the two Speakers’approach to retirement security- put the burden on the middle class and the poor- is similar.


  90. - Arthur Andersen - Thursday, Jan 31, 13 @ 8:02 am:

    RNUG, it’s not that some contracts are more equal than others, it’s that contracts can stipulate who gets paid first.
    Not so different from a secured vs. unsecured debt.


  91. - Oswego Willy - Thursday, Jan 31, 13 @ 8:12 am:

    - AA -,

    I dunno if we qualify to be “Lunchpail Republicans”, but I am guessing its like the Oppo of Reagan Democrats, so, can’t be all bad(?)


  92. - Johnnie F. - Thursday, Jan 31, 13 @ 8:24 am:

    Shot across the bow to the unions, for sure. After all, being in the sunset of your political career means throwing anyone and everyone under the bus when they serve no purpose to your power. It is most important that your legacy needs be fed. To me, the letter is more a counter attack to the real facts getting out to the general public, as in the Ralph Martire article the other day.


  93. - Arthur Andersen - Thursday, Jan 31, 13 @ 8:25 am:

    Close enough for me, Willy. I’ll see about getting the shirts printed.


  94. - Oswego Willy - Thursday, Jan 31, 13 @ 8:31 am:

    ===Close enough for me, Willy. I’ll see about getting the shirts printed.===

    Great! Just make mine a Golf Shirt if you could.


  95. - Oswego Willy - Thursday, Jan 31, 13 @ 8:35 am:

    ===being in the sunset of your political career===

    They were saying that about MJM when Lee A. Daniels grabbed the gavel, they were saying that about MJM when MJM got the gavel BACK from Lee A. Daniels, they were saying that when Lisa won the IL Senate primary against Farley about MJM, and they have been saying that every time Lisa ran and won the AG spot.

    Speaker Madigan will be in “his sunset” for about 10 days before any of us know MJM is in his sunset.

    THAT is the only thing I know when talking about MJM, his career, and it sunsetting.


  96. - wizard - Thursday, Jan 31, 13 @ 8:56 am:

    rnug: when i retired, the state attempted to “stiff” me on legitimate travel costs. i asked the union to assist. they told me that i was no longer a paying member and would not/could not help. took me four months to get my money with no help from the union. if they agree to a reduction in my pension, i believe it is not legal. they do not represent me and certainly did not when i needed them to.


  97. - anon - Thursday, Jan 31, 13 @ 11:13 am:

    Why not solve the pension problem by asking those that caused it? Cease and desist paying pensions to any Elected Official or Legislator who failed to fund the system for all those years!


  98. - Happy - Thursday, Jan 31, 13 @ 11:26 am:

    Way to go Mr. Speaker! It is about time labor unions get serious and come to your table. While unions continue to keep up with cost of living and step increases, we, in another world must wait for 5-6 months for payments from IL. Who runs this state? Elected officials or the Union for public employee!


  99. - Who is accountable? - Thursday, Jan 31, 13 @ 7:34 pm:

    Do you believe politicians? Do you believe lawyers? Do you believe your working and not getting anywhere fast? If your answers are “NO”, “NO”, “YES” then why would anyone believe all the bull these politicians say about state employees? We are front and center for all the lies told about us. But….what if someone ask the question “What do the legislators (part time employees) make on their pension” Can we find that out? What are their salaries? Why are people so quick to throw stones at people working for the state instead of these politicians who use the taxes all of us pay to this “Great State of IL”


  100. - Who is accountable? - Thursday, Jan 31, 13 @ 7:53 pm:

    Has anyone looked at section b:
    (40 ILCS 5/2-119.1) (from Ch. 108 1/2, par. 2-119.1)
    Sec. 2-119.1. Automatic increase in retirement annuity.
    (a) A participant who retires after June 30, 1967, and who has not received an initial increase under this Section before the effective date of this amendatory Act of 1991, shall, in January or July next following the first anniversary of retirement, whichever occurs first, and in the same month of each year thereafter, but in no event prior to age 60, have the amount of the originally granted retirement annuity increased as follows: for each year through 1971, 1 1/2%; for each year from 1972 through 1979, 2%; and for 1980 and each year thereafter, 3%. Annuitants who have received an initial increase under this subsection prior to the effective date of this amendatory Act of 1991 shall continue to receive their annual increases in the same month as the initial increase.
    (b) Beginning January 1, 1990, for eligible participants who remain in service after attaining 20 years of creditable service, the 3% increases provided under subsection (a) shall begin to accrue on the January 1 next following the date upon which the participant (1) attains age 55, or (2) attains 20 years of creditable service, whichever occurs later, and shall continue to accrue while the participant remains in service; such increases shall become payable on January 1 or July 1, whichever occurs first, next following the first anniversary of retirement. For any person who has service credit in the System for the entire period from January 15, 1969 through December 31, 1992, regardless of the date of termination of service, the reference to age 55 in clause (1) of this subsection (b) shall be deemed to mean age 50.
    (b-5) Notwithstanding any other provision of this Article, a participant who first becomes a participant on or after January 1, 2011 (the effective date of Public Act 96-889) shall, in January or July next following the first anniversary of retirement, whichever occurs first, and in the same month of each year thereafter, but in no event prior to age 67, have the amount of the retirement annuity then being paid increased by 3% or the annual unadjusted percentage increase in the Consumer Price Index for All Urban Consumers as determined by the Public Pension Division of the Department of Insurance under subsection (a) of Section 2-108.1, whichever is less.
    This subsection (b) does not apply to any person who first becomes a member of the System after the effective date of this amendatory Act of the 93rd General Assembly.
    Looks like a sweat deal for legislators!!!!!


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