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Whatever works, man

Friday, Feb 1, 2013

* This move by Senate President John Cullerton would most certainly take away a fig leaf used by some recalcitrant Republicans

Cullerton said he is open to a GOP demand to include judges in his plan to solve Illinois’ $95 billion pension crisis — a bill he said he hopes to have the Senate vote on by late February.

In every pension-reform plan that’s surfaced thus far, the 984 members of the Judges Retirement System of Illinois have been left out because of a constitutional protection against having their salaries be “diminished” and worries judges would block a pension deal on legal grounds. […]

The determining factor in whether to include judges in a pension package, Cullerton said, is whether “I pick up votes or lose votes” by adding the provision.

A spokeswoman for Senate Minority Leader Christine Radogno (R-Lemont) said that addition has been one of her boss’ demands in a pension deal.

“To somehow not include judges because you think they might rule more favorably [on a broad pension package], that’s just ludicrous,” said Patty Schuh, a spokeswoman for Senate Minority Leader Christine Radogno (R-Lemont).

“Sen. Radogno has long believed [a pension package] ought to be comprehensive and include all five systems because this may be the only opportunity we get to do pension reform,” Schuh said.

* From the Constitution

Judges shall receive salaries provided by law which shall not be diminished to take effect during their terms of office.

The judiciary ruled during the Blagovjevich years that scheduled salary COLAs were covered by that constitutional provision, so including them in the pension bill is just asking for trouble.

But, if it’s severable and it attracts some votes, then by all means go for it. This is just an excuse by some people to avoid voting on a bill. So, take the excuse away if doing so attracts more net “Yes” votes.

Also, Radogno supported a pension bill last year which included neither the judges nor the teachers.

- Posted by Rich Miller        


40 Comments
  1. - He Makes Ryan Look Like a Saint - Friday, Feb 1, 13 @ 10:11 am:

    I have spoken to Judges that laugh at the fact they may exclude them from the Pension reform so they can rule on it. They know if they rule on it that the next year theirs will be included anyway. It should be all or none.


  2. - Ret. Prof - Friday, Feb 1, 13 @ 10:17 am:

    Felt vs. Board of Trustees, 107 Ill.2d 158 (1985).
    Facts
    Felt vs. Board of Trustees was a consolidated appeal
    concerning the constitutionality of an amendment to the
    Judges’ Retirement article of the Pension Code which
    changed the salary base for calculating judicial pensions
    from the judge’s salary on his or her final day of service to
    the average salary in the judge’s final year of service for
    persons retiring on or after January 1, 1983. In enacting
    the amendment, the General Assembly sought to discourage
    judges from retiring upon obtaining a salary increase
    without contributing to the pension fund on the basis of the
    increased salary. The plaintiffs were former judges of the
    circuit court of Cook County, as well as the widow of a
    deceased judge. Each of the plaintiffs applied for a pension
    after the effective date of the act on the basis of the salary
    earned on the last day of service, however in each case the
    board of trustees of the Judges’ Retirement System granted
    an annuity based on the average salary in the final year of
    service.
    Ruling
    The circuit court set aside the board’s ruling, and the
    Supreme Court affirmed the circuit court’s ruling.
    Holding
    Relying on the plain language of article XIII, section 5 of
    the Illinois Constitution and the proceedings from the 1970
    constitutional convention, the court held that the legislative
    change in the basis of computing a retirement annuity
    constituted an impairment in the retirement benefits of the
    plaintiffs, and was therefore unconstitutional. The court
    -5- noted that even before the enactment of the 1970
    constitution, the Supreme Court held in the 1961 case
    Bardens vs. Board of Trustees, 22 Ill.2d 56, that a
    legislative enactment that changes the salary base for
    computing a retirement annuity constituted a contractual
    impairment for members already enrolled in the Judges’
    Retirement System (the facts in Bardens were essentially
    the same as Felt). Furthermore, the court found the
    financial impairment to the pensions of two of the plaintiffs
    to be substantial and an unreasonable exercise of the state’s
    police power.


  3. - Bigtwich - Friday, Feb 1, 13 @ 10:24 am:

    A provision might be crafted carefully. From the Illinois Constitutuion, SECTION 10. TERMS OF OFFICE,

    The terms of office of Supreme and Appellate Court Judges shall be ten years; of Circuit Judges, six years; and of Associate Judges, four years.


  4. - Sparky - Friday, Feb 1, 13 @ 10:37 am:

    Just a question, but is there anything floating out there on pension reform that will not be ruled unconstitutional?


  5. - Robert the Bruce - Friday, Feb 1, 13 @ 10:44 am:

    ==I have spoken to Judges that laugh at the fact they may exclude them from the Pension reform so they can rule on it. They know if they rule on it that the next year theirs will be included anyway.==
    Agree - it was pretty ridiculous to think that judges wouldn’t understand that any ruling they had on others’ pensions might establish legal precedence. They are judges after all, and are somewhat familiary with this concept.


  6. - Professor - Friday, Feb 1, 13 @ 10:45 am:

    Constitutions are ‘living documents’ and need to be interpreted with changing times and conditions - so let’s see what the courts say.


  7. - RNUG - Friday, Feb 1, 13 @ 10:48 am:

    Sparky,

    Yes, there is some stuff but they keep tieing it to protected stuff.

    Here’s some definitely legit proposals:

    1) shift normal pension costs for TRS from the state to local school disctricts

    2) reset the ramp, both in terms of the date and funding level goal … see Martire’s proposal as an example

    3) further modify terms for new hires

    4) expand the revenue base by taxing retirement income. This is probably a non-starter because it would be all retirement income including Social Security and private pensions.

    5) expand the revenue base by taxing services; this could be a large amount

    And here are some that fall in the “maybe” category:

    6) Change the terms going forward for current employees by offering them a legitimate choice between two roughly equal alternatives. The “cash balance” proposal for TRS and SURS is an example of this.

    7) Actually bargain with the union in good faith (OK, everybody quit laughing!) and strike a deal with the current workers.

    I’m sure I’ve left some other legit proposals out.

    What is most likely off the table is any retroactive changes on the already retired.


  8. - Pelon - Friday, Feb 1, 13 @ 10:51 am:

    I think one of the proposals which required employees to choose between the current pension system and retiree health care had a chance to be ruled constitutional, but since there are no choices built into the latest proposals, I have a hard time seeing how any of them are remotely constitutional given that they reduce benefits for people who are already retired.


  9. - RNUG - Friday, Feb 1, 13 @ 10:54 am:

    Not sure it would be completley severable since the salary and automatic annual increase (COLA) are part of the “inseverable” section:

    Section A-97. Severability and inseverability.

    The changes made by this Part A to Acts other than the Illinois Pension Code are severable from the other changes made by this Act. The changes made by this Part A to an Article of the Illinois Pension Code are severable from the changes made by this Part A to another Article of the Illinois Pension Code. However, the changes made by this Part A in an Article of the Illinois Pension Code that relate to (i) automatic annual increases, (ii) employee or member contributions, (iii) State or employer contributions, (iv) State funding guarantees, or (v) salary, earnings, or compensation are mutually dependent and inseverable.


  10. - RNUG - Friday, Feb 1, 13 @ 11:00 am:

    Pelon,

    That COLA / health insurance choice might have passed muster if the health insurance is ruled not protected AND if it gave something more than just the right to buy the insurance. Given that you can go buy health insuranc eon the open market, I don’t see any value in just the right to buy in to the state plan with no level of premium support.


  11. - Ret Prof - Friday, Feb 1, 13 @ 11:01 am:

    Sparky- this is why Cullerton wants the insurance swap. The question is would it be a real swap or a forced by the power of the state. If insurance makes it through as a protected benefit, Cullerton’s plan goes down in flames.

    Also changes for new hires are always legal but they already did that.


  12. - RNUG - Friday, Feb 1, 13 @ 11:02 am:

    Pelon,

    SB0001 does offer a “cash balance plan” in place of a defined benefit plan choice to TRS and SURS participants. I wouldn’t pick it, but it is there.


  13. - 47th Ward - Friday, Feb 1, 13 @ 11:03 am:

    It seems like the General Assembly could change the pension plans for new judges elected or appointed after a certain date, a la Tier Two employees. And I think judicial retiree COLAs and healthcare premiums could be diminished too, although I wouldn’t be surprised for a court to rule against that, given the likely plaintiffs in such a case.

    But it’s worth a try. No reason not to make some changes to judicial pensions if we’re going to try to change pensions for other public employees.


  14. - Confused - Friday, Feb 1, 13 @ 11:30 am:

    How many Republicans are left in the Senate and why do we care if they have a fig leaf?


  15. - RNUG - Friday, Feb 1, 13 @ 11:36 am:

    I know some of the proposed bills cap the pensionsable salary at the same level as SS. This may or may not be a good thing. If the feds ever take the cap off SS and make all salary SS taxable, which is a likely move to shore up SS, the the state would have no cap either.

    I think the cap is intended to address some of the pension abuses issues, like overtime. Maybe that should be addressed a different way, by removing overtime from the pensionable base. I know it is included today because of a court ruling based on the current wording of the law, but that could be changed.

    n deciding if such a change is needed, the real question is who makes out the best when overtime is included; does the state take in less or more in employee payments than they pay out in increased benefits?


  16. - Ruby - Friday, Feb 1, 13 @ 11:37 am:

    To solve Illinois’ financial crisis, the IL General Assembly needs to look at the many causes of Illinois’ financial problems. Putting all of the blame on state pensions ignores solutions to Illinois’ fiscal troubles that don’t require ignoring the Illinois constitution.

    Examples of problems that need to be solved:

    The cost of health care for public and private employees is crushing the economy

    Corporate welfare in the form of uncollected state income taxes and TIF districts

    State sales taxes that we pay but are kept by businesses

    Pay to play corruption that is estimated to cost an annual half billion dollars

    Better investment of pension funds in the recently improved stock market and reducing fees paid for the management of the investments


  17. - Puzzled - Friday, Feb 1, 13 @ 11:47 am:

    If JRS is included, how will the issue of conflict of interest be addressed when it goes to the courts? I don’t know if there is any definitive answer, if not does someone have an idea of how this might be handled?


  18. - Meaningless - Friday, Feb 1, 13 @ 11:48 am:

    To RNUG … My utmost compliments to your excellent posts today. Thank you.


  19. - Robert the Bruce - Friday, Feb 1, 13 @ 11:58 am:

    And RNUG takes the early lead in the much coveted Best Commenter 2013 prize.


  20. - RMD - Friday, Feb 1, 13 @ 12:10 pm:

    RUG good work, but may I add some.

    Transfer pension costs to school and have all school budgets and teacher contracts approved by a vote of eligible voters in the district.

    Term limits for legislators and judges.

    Conduct a study to determine of any contracting out options may be available to replace current public positions.


  21. - Anon. - Friday, Feb 1, 13 @ 12:18 pm:

    “to take effect during their terms of office.”

    The special provision for judges has no application to retired judges, so if the state can renege on its obligation to current retirees in the other systems, it can renege on its obligation to retired judges, too. As He Makes Ryan points out, any intelligent judge knows that.


  22. - Cook County Commoner - Friday, Feb 1, 13 @ 12:18 pm:

    How does an Illinois judge get around disqualifying herself from ruling on a pension issue involving the state judiciary? Does anyone know how an Illinois judge gets around the following:

    Illinois Code of Judicial Conduct
    C. Disqualification.
    (1) A judge shall disqualify himself or herself in a proceeding in which the judge’s
    impartiality might reasonably be questioned, including but not limited to instances where:
    (d) the judge knows that he or she … has an economic interest in the subject matter in controversy …

    I thought keeping the judicial pensions out of reform was to avoid a head-on clash with the foregoing. Of course, judges, knowing that any pension reform is coming their way, should precipitate disqualification in any case whose ruling could reach them. But then again, this is Illinois.


  23. - RNUG - Friday, Feb 1, 13 @ 12:18 pm:

    Robert the Bruse,

    Don’t worry. I’m sure I will also say some stupid stuff before the year is out …


  24. - Anonymous - Friday, Feb 1, 13 @ 12:19 pm:

    SECTION 5. PENSION AND RETIREMENT RIGHTS
    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.

    Guess what folks a member is a member, it doesnt distinguish between an active or retired member.
    just the facts..


  25. - steve schnorf - Friday, Feb 1, 13 @ 12:35 pm:

    Commoner, there is effectively a necessity exception that allows a judge to rule if there are no other judges who are not conflicted


  26. - Stu - Friday, Feb 1, 13 @ 1:01 pm:

    http://www.state.il.us/court/Opinions/SupremeCourt/2004/May/Opinions/Html/97624.htm

    “We begin by noting that none of the parties have questioned the propriety of our consideration of this case. All seven members of our court belong to both classes of judges defined by the circuit court and therefore have a pecuniary interest in the outcome of these proceedings. Such an interest would normally require us to disqualify ourselves. That option is not available to us here. Illinois law makes no provision for appointing temporary alternative jurists to sit in our place. Even if it did, there would be no one for us to choose who did not face the same conflict of interest. All sitting Illinois judges will be affected by the outcome of this appeal. Were we to recuse ourselves, the parties would therefore be left without a forum in which to review the circuit court’s judgment. Their right to appeal would be lost. Under these circumstances, the common law “rule of necessity” obligates us to proceed. See United States v. Will, 449 U.S. 200, 214-15, 66 L. Ed. 2d 392, 405-06, 101 S. Ct. 471, 480-81 (1980).”


  27. - Six Degrees of Separation - Friday, Feb 1, 13 @ 1:13 pm:

    there is effectively a necessity exception that allows a judge to rule if there are no other judges who are not conflicted

    This is the principle that allowed judges to rule on protecting their COLA’s during the Blago anministration. No other court had jurisdiction…wasn’t a federal issue or federal constitutional issue, so the federal courts and USSC couldn’t touch it.


  28. - fultonfarm - Friday, Feb 1, 13 @ 1:36 pm:

    I know that when I was hired in 1977 no premium health insurance for retirees was a written promise. When I retired in 1986, it still was in the SURS Benefit handbook.

    That about says it all unless one just ignores everything.

    And this was not contract by the Unions.

    What could be changed is to drop Dependents from employee health insurance or at least make them pay the entire cost. At present, and in the past, this has been negotiated by the Unions- thus a different issue.

    It was and is an esttablished benefit


  29. - capncrunch - Friday, Feb 1, 13 @ 1:39 pm:

    “Just a question, but is there anything floating out there on pension reform that will not be ruled unconstitutional?”

    The cost shift?


  30. - RNUG - Friday, Feb 1, 13 @ 1:39 pm:

    RMD,

    Good suggestions.

    As far as term limits go, we’ll never get them if it is up to the GA.

    But maybe now is the ideal opportunity.

    Start a petition drive for a term limit amendment to the state constitution; you should be able to get enough valid signatures to get it on the ballot from just the state employees, teachers and retirees. And maybe it would fly better with the public if it also stripped the politicans of their future retirement benefits.

    Then the unions should put all their political contributions and GOTV manpower into pushing that issue in front of the voters instead of aiding individual candidates.


  31. - Sgtstu - Friday, Feb 1, 13 @ 2:12 pm:

    RNUG Love that idea, if this is started I will help in my area of the State with required signatures. Time to put the boys and girls in Springfield in check !!

    P.S. send lots of forms because I will need them.


  32. - iThink - Friday, Feb 1, 13 @ 2:14 pm:

    –have all school budgets and teacher contracts approved by a vote of eligible voters in the district.–

    Lunacy. This is the reason we have representative government and elect school boards; I cannot even fathom how badly this would turn out.


  33. - Robert the Bruce - Friday, Feb 1, 13 @ 2:26 pm:

    ===Robert the Bruse,

    Don’t worry. I’m sure I will also say some stupid stuff before the year is out …===

    And you misspelled my handle/favorite beer - Robert the Bruce. You’ve already lost my vote.


  34. - Captain Illini - Friday, Feb 1, 13 @ 2:26 pm:

    I think the tables should be applied to the legislature regarding their required pension payments…something like a set percentage of annual budgets toward the payment, thus a predictable set aside factored in each year. It might not fix the immediate problem, but it would affect the rating agencies opinion that we’re not addressing the issues. Baby steps.


  35. - Captain Illini - Friday, Feb 1, 13 @ 2:27 pm:

    …in leiu of the current ramp law that is…


  36. - Juice - Friday, Feb 1, 13 @ 2:30 pm:

    RNUG, already been tried. The Supreme Court tossed it.


  37. - Arthur Andersen - Friday, Feb 1, 13 @ 2:35 pm:

    I Think iThink at 2:14 made this point better and more concisely than I could have. Well done.

    To the post, as you say, Rich, if this is what it takes, why not?


  38. - Just The Way It Is One - Friday, Feb 1, 13 @ 3:34 pm:

    ===…a member is a member…===

    And to follow up on Anonymous @12:19 pm’s Comment, that Constitutional Clause LIKEwise does NOT distinguish Judges as members in some special category which is untouchable somehow…so…they should be included, despite all the blather about their ultimate rulings.


  39. - RNUG - Friday, Feb 1, 13 @ 4:21 pm:

    Robert the Bruce,

    I already admitted the other day on Rich’s “Meet the Commentator” question that I couldn’t type !!! Do you think that “D” I got in the summer school typing class had something to do with one boy in a room with 17 teenage girls?


  40. - RNUG - Friday, Feb 1, 13 @ 4:33 pm:

    Juice,

    Don’t remember that. I’ll have to go see exactly why it was tossed.


Sorry, comments for this post are now closed.


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