51 Comments - Under Influenced - Thursday, May 1, 14 @ 2:36 pm: @TheRealJimArids: It takes a lot of resources to monitor, “the twitter”. - Anonymous - Thursday, May 1, 14 @ 2:38 pm: Obviously, there was method to the madness of leaving judges out of pension legislation that anyone with their thinking cap on could have foreseen. So, if an all expenses paid brainwashing session by big business can arm twist the judges to their way of thinking (or a little under the table to top it off?) is there any hope in this state for regular people? America the Plutocracy. - Chicago Cynic - Thursday, May 1, 14 @ 2:39 pm: Oh cmon! The Koch Brothers and their corporate supporters are just trying to ensure the equal application of the law. I can’t believe some lefty types have a problem with their blatant lobbying of judges. - Formerly Known As... - Thursday, May 1, 14 @ 2:39 pm: Perhaps a sign the justices are leaning against the Koch brothers / State of Illinois position on this one? Could be a good sign for supporters of honoring our pension obligations. Why bother attending if all you expect to hear is a recycling of information you have already considered and found lacking? - Arthur Andersen - Thursday, May 1, 14 @ 2:39 pm: Go Tweet yourself, Mayor Ardis. Let’s make those Downstate cities attractive to employers by lobbying for what…municipal bankruptcy? Excuse me while I fire up a parody account. - Rebuttal - Thursday, May 1, 14 @ 2:39 pm: Maybe Mayor Ardis would have more money if he wasn’t using the swat team to go after parody twitter accounts. - Archiesmom - Thursday, May 1, 14 @ 2:40 pm: I completely agree with Sirota. The mere fact that this is an expenses-paid conference tells me it’s a lobbying effort. (And that Koch name.). I certainly hope none of our judges or justices will be fooled into thinking this is an objective overview of a very complex problem. - Formerly Known As... - Thursday, May 1, 14 @ 2:42 pm: Incredible. Jim Ardis discovering Peoria has more pressing problems than a twitter account? I don’t believe it. Now, how long until he discovers the First Amendment? - Rich Miller - Thursday, May 1, 14 @ 2:42 pm: Let’s stick to the topic at hand, please. - Paid - Thursday, May 1, 14 @ 2:47 pm: That is a story from Illinois News Network. Posted by IR? - NewWestSuburbanGOP'er - Thursday, May 1, 14 @ 2:49 pm: If the cities were paying the correct amounts into the pension funds,(like firefighters do every paycheck 9.455%)and not shorted them over the last 40+ years, the pension systems would not have the problems they are facing today. The driving factor for the pension shortfalls are not the benefits, it is the underfunding and the financial collapse of our economy in 2008. The suburban mayors love their IMRF and make sure that it is funded by state statute, yet when it comes to firefighters and police, it’s a different story. Filing bankruptcy? What type of example are you setting when you decide, you don’t want to pay for something and just declare bankruptcy? Shame on you Rockford Mayor Morrissey and every other elected official who is even considering that option. - Tsavo - Thursday, May 1, 14 @ 2:49 pm: The Mayors might want to look at what the retirees in Detroit received during bankruptcy negotiations. I would be better off with Detroit’s deal than I am with SB1. The Retired Detroit Police and Fire Fighters Association agreed to support a deal that would involve not cutting monthly pension checks and keeping almost half of annual cost-of-living increases, Rosen said in a statement. The current cost-of-living adjustment is 2.25%. - boat captain - Thursday, May 1, 14 @ 2:52 pm: When people lose faith in their government and leaders it sets a bad feeling in their minds about the future of their country. As many have lost belief in it already. But when the perception of the loss of the fairness of the judicial system becomes real the country is in trouble. This is a blatant way of trying to influence the people that are supposed to make the law fair for all. And judge the law as law, and not influence it from politicians or wealthy corporations. - DuPage - Thursday, May 1, 14 @ 2:54 pm: Illinois judges are NOT going to attend. That is a good decision. I think they can read the Illinois constitution without any lobbying. - Judgment Day - Thursday, May 1, 14 @ 2:56 pm: First off, local governments can only file for bankruptcy IF the legislature passes enabling legislation. This is known from the case of Washington Park, IL. Here’s the Wikipedia reference: “Washington Park filed for Chapter 9 bankruptcy protection in July 2009, citing assets of less than $50,000 and debt of more than $1 million. U.S. Bankruptcy Judge Pamela Peppers threw out the filing in December 2010 after finding there was no state law enabling a municipality to declare bankruptcy.[2] Washington Park filed for bankruptcy in 2004 as well, claiming a $1.6 million debt, but that filing was dismissed when the village briefly emerged from insolvency.[3]” Link is: http://en.wikipedia.org /wiki/Washington_Park,_Illinois So, enabling legislation would have to be written and passed into law. IMO, that’s an immediate war between the public sector unions and the units of local government. That’s going to be a brutal fight. The more interesting question to me is what version of the enabling legislation would the State of Illinois use? Michigan? California? There’s others. If it’s based on the California version, Rahm’s probably going to be spitting bullets (Hint: Requires a lot of certifications of things that Rahm really, really won’t like). It’s interesting to me that this entire issue is even coming up at this time. This is an issue that could put a whole bunch of people running for office on the spot - big time. Fun times ahead. - Precinct Captain - Thursday, May 1, 14 @ 2:57 pm: Do any of our Illinois judges have financial interests in any of these corporate backers of the “Kochtopia” judicial conference? Huffington Post had a very disturbing report recently in regards to such issues at the federal level. http://www.huffingtonpost.com/2014/04/28/judges-conflicts-of-interest_n_5227031.html - Judgment Day - Thursday, May 1, 14 @ 2:59 pm: Btw, hat tip to our gracious host for pointing the Washington Park, IL out to me some time ago. - Langhorne - Thursday, May 1, 14 @ 3:00 pm: In their presser, one of the mayors referred to “champagne and caviar pensions”. Real nice tone for fostering a mutual solution. - VanillaMan - Thursday, May 1, 14 @ 3:01 pm: We all know that judges cannot be bought. - 5-ohhhhhh - Thursday, May 1, 14 @ 3:06 pm: They already reformed Article 3 and 4 pensions (downstate police and Fire) in 2009 and all hired after Jan. 1 2010 must work until 55 YO with lower COLAs and still no social security. The Division of Insurance keeps changing the way the unfunded liability is calculated to make the funds appear worse off then they are in reality. They changed it two years ago and it did not make that big of a difference so they are changing it again this year. - anon - Thursday, May 1, 14 @ 3:07 pm: Thanks for asking about the Illinois Supreme Court justices. Relieved to hear the news. As for declaring bankruptcy, I am sure none of these municipalities has any real intention of turning over all of their assets to the supervision of a bankruptcy court. But “BANKRUPTCY!”is the boogeyman used to scare unions and public employees into relinquishing their hard-earned benefits. - lake county democrat - Thursday, May 1, 14 @ 3:07 pm: Anyone ever see the social psychology studies on how much we’re influenced at the grocery store when they give you free moresels of food? Just think what an expenses-paid vaca will do. - Rudy - Thursday, May 1, 14 @ 3:09 pm: Assume IL judges will receive summaries of the conference. Wonder if any are sending interns? - Judgment Day - Thursday, May 1, 14 @ 3:09 pm: “In their presser, one of the mayors referred to “champagne and caviar pensions”. Real nice tone for fostering a mutual solution.” You might want to sit on a Police and Fire Commission board for a while. It’s educational as far as retirement bennies. So far, the only “mutual solution” being offered seems to be is “you need to find a way to fully fund the retirement obligations. Period.” But if the numbers don’t work, then they just don’t work. Just a thought - When you put people in a corner (like is happening to units of local government), the options tend to be kind of limited: (a) move the walls, or (b) come straight out. Sounds to me like this was the first step in option (b). Fun times ahead? - Formerly Known As... - Thursday, May 1, 14 @ 3:15 pm: == one of the mayors referred to “champagne and caviar pensions” == Wonder what that Mayor’s pension look like? Or a few of the others calling for bankruptcy? - Judgment Day - Thursday, May 1, 14 @ 3:26 pm: “Wonder what that Mayor’s pension look like? Or a few of the others calling for bankruptcy?” Well, IF the mayor/village manager is even eligible for retirement benefits (outside of Chicago), it’s most likely IMRF. IMRF is right around 80%+ funded, so they’re not the problem. Now, if there are other retirement ’sweetners’, those should have been fully disclosed by the unit of local government. - midwaygardens - Thursday, May 1, 14 @ 3:32 pm: Can a municipal or state pension fund declare bankruptcy? What happens if there just isn’t enough money to pay benefits? Do the courts step in and require that the contributions be made? And on Detroit they changed the expected investment returns based on last year’s stock market. What happens if the funds don’t actually meet those higher rates of return? - Sunshine - Thursday, May 1, 14 @ 3:46 pm: Perhaps they could offer the judges jobs at IDOT….on an ‘attendance not required’ basis. Not sure how attending the conference will help them interpret the law and judge accordingly. Maybe great food and beverages (free) would help them to see more clearly? - A guy... - Thursday, May 1, 14 @ 3:57 pm: Unfortunate that Ardis did any talking at all. This is a very serious problem, especially for non-home rule communities. Home Rules could become non-home rule if taxes were raised too abruptly with a citizen’s movement. There are always a number of these efforts going on to either: prevent home rule, or reverse it. Once tax caps are in place, you can cut, but eventually the cuts hit police and fire too. This would actually be an excellent time for some of those unions to offer a pre-emptive agreement that heads this off. There is a give up involved, but it doesn’t have to be the greater sacrifice it could become. Heading it off with an agreement could even possess some municipalities to actually go to referendum for this in good faith. I fear there’s not much interest in doing this, but from a business standpoint it could be a decent strategy. The munis that have kept up with the payments and are still losing ground in fund maturity have a case to make. There are some new realities to consider. I’d learn from the anguish that’s out there from the Pension bill at the ISC now. I honestly believe there’s a deal to be made in a lot of places. I don’t see any downside to exploratory discussions among some rational folks. - D.P.Gumby - Thursday, May 1, 14 @ 4:08 pm: Attendance by judges at “educational programs” sponsored by entities w/ special interests in the topics is a very divisive issue in the world of judicial ethics. There has been a general consensus against those directly sponsored by corporations, etc. Now, the mechanism is to use a particular “independent” entity, like a university or law school to cloak the funding. But it doesn’t cloak the potential for an “appearance of impropriety”. - RNUG - Thursday, May 1, 14 @ 4:09 pm: Right now, unless they specifically receive permission from the General Assembly, government entities in Illinois can not declare bankruptcy. If we assume for argument’s sake that a pension fund created for government employees is a government “entity”, then no, they can not declare bankruptcy under IL law. Going a bit further (and paraphrasing some), to date, IL courts including the ISC have said the (government) pensions have to paid when due. Period. End of discussion. What the courts have refused to do so far is specify a specific way of pre-funding or otherwise financing the future pension payments. Not the court’s problem how the government entity comes up with the money to actually pay each month’s pension checks. No one really disputes that the government entities owe the pensions. Where the fight is occurring is on the fringes, trying to modify the requirements for earning a pension, modifying the amount of the future automatic annual increases, and over other benefits, such as subsidized health insurance. Hopefully the justices on the ISC will agree that the language in the Constitution is clear and unambiguous and decide in favor of the employees / retirees who have relied on the full faith and credibility of the State. It does appear the ISC justices are going to avoid any appearance of inappropriate influence or behavior. (Thanks, Rich, for asking about their attendance.) As pointed out in the Huffington Post article Rich linked to, Illinois is one of the main battlefields in this fight. If they can break IL’s Pension Protection Clause, no government pension in the nation will be safe. If the government pension haters lose here, they can continue to fight a state by state rearguard action where they could likely win some battles in states with weaker protections than IL (and similar states like NY & AZ). - Judgment Day - Thursday, May 1, 14 @ 4:09 pm: “The munis that have kept up with the payments and are still losing ground in fund maturity have a case to make.” Work with municipalities that are literally ‘hollowing out’ their staff infrastructure to fund police and fire pensions. It’s not extremely critical yet, but it’s on the path to get there. And sooner than most think. Go out on many municipality websites and pull up their annual reports and audit reports. Makes for interesting reading, if you are into numbers. Many municipalities are deep in budgeting right now, and the cuts are a coming…. Lots of outsourcing and contract work in the future. - Steve - Thursday, May 1, 14 @ 4:13 pm: The pension issue must be a problem created by the Koch brothers. Harry Reid says they are bad people. Harry Reid wouldn’t lie. All the major problems in Chicago are due to the Koch brothers ideology which is firmly in control of Chicago’s City Council. Look at all those Republicans on Chicago’s City Council , they are controlled by the Koch brothers. - Anonymous - Thursday, May 1, 14 @ 4:16 pm: The people who are screaming about champagne pensions are almost always those making multiple times as much. It’s entertaining to see corporate executives get their panties in a snitch over 40K/year pensions when that’s their monthly income. If there are, in fact, public pensioners collecting hundreds of thousands of dollars/year, then those might be looked at. I’d love to see a list of pensioners earning those kinds of pensions. I doubt you’ll see the average teacher, office worker, firefighter, police officer doing so, however. Rich people who like to stomp on middle class workers/retirees are nothing more than snot nosed brats. So much for the class and generosity that wealth brings. But that aside, the problem with pensions has nothing whatsoever to do with workers/retirees or their benefits. This is a mantra designed to deflect the blame. As noted above, and God only knows how many more thousands of time it needs to be stated as FACT, the pension fund problem has resulted from diversion of payments over multiple decades (screwing the employees and dooming their retirement) AND, of course, the market conditions. As seen in IMRF, however, there is no problem, even with market conditions because payments were never skipped. Enough of the ridiculousness of bloated benefits. If there are such things, then fix THOSE. - Judgment Day - Thursday, May 1, 14 @ 4:24 pm: “Going a bit further (and paraphrasing some), to date, IL courts including the ISC have said the (government) pensions have to paid when due. Period. End of discussion.” Except that’s subject to change IF enabling legislation is enacted by the State of Illinois, allowing units of local government to file for bankruptcy. Then we have a ‘game changer’, because federal bankruptcy judges can virtually order anything. It’s the Federal Supremacy Clause (See http://en.wikipedia.org/wiki/Supremacy_Clause). Short version: “The Supremacy Clause is the provision in Article Six, Clause 2 of the U.S. Constitution that establishes the U.S. Constitution, federal statutes, and U.S. treaties as “the supreme law of the land”. It provides that these are the highest form of law in the U.S. legal system, and mandates that all state judges must follow federal law when a conflict arises between federal law and either the state constitution or state law of any state.” Question is: Will the situation ever get there? - NewWestSuburbanGOP'er - Thursday, May 1, 14 @ 4:29 pm: @-A Guy… Once tax caps are in place, you can cut, but eventually the cuts hit police and fire too. This would actually be an excellent time for some of those unions to offer a pre-emptive agreement that heads this off. There is a give up involved, but it doesn’t have to be the greater sacrifice it could become. Heading it off with an agreement could even possess some municipalities to actually go to referendum for this in good faith. I fear there’s not much interest in doing this, but from a business standpoint it could be a decent strategy. The munis that have kept up with the payments and are still losing ground in fund maturity have a case to make. Just so you know, here is what the firefighters have been doing with regards to pension reform. The AFFI has been at the forefront of pension reform legislation in Springfield. The AFFI participated fully in legislative negotiations as Senator Terry Link unsuccessfully tried to hammer out a meaningful compromise among all parties involved. Unfortunately,led by their lobbyists at the Illinois Municipal League, the cities and municipalities walked away from negotiations. Senator Link’s package would have offered up short-term tax relief for homeowners. However, the IML walked out because the package included language that requires local governments to fund the required contribution mandated by State statute. To quote Senator Link-”The negotiations,however, have reached an impasse. Why? The municipalites oppose provisions that require them to make fair and just employer contributions, just as police and firefighters are required to do. The proposal does not require municipalities to make their required contributions until the year 2015, thus giving financially troubled local governments time to bring their fiscal houses in order. Everyone agrees that the pension system need stabilization. All parties have negotiated in good faith. However, we will remain at this impasse until the municipalities agree to pay their fair share into the pension plan, just as firefighters and police officers are required to do.” In essence,Senator Link offered a five year amnesty period during which local governments could get their financial house in order. Then beginning in 2015, they would required to begin to meet the pension funding obligations they have failed to fund for several decades. Firefighters contribute 9.455% of their salary to their pension. This contribution is astatutory requirement and never wavers. Firefighters DO NOT qualify for social security benefits from local government employers. Their pension is designed to provide financial security in their retirement years. Firefighters first and foremost commitment is to the people they serve. Firefighters are different than other public service employees. They risk their life and safety serving the public. The dangers and physical strains demanded from their jobs and the window of job performance is shorter than most public employees. - Federalist - Thursday, May 1, 14 @ 4:32 pm: Part of an on-going effort to attack ALL public employees (with perhaps the exception of judges, police and firemen) After all, the tremendous increase in the state budget over the past 45 years (since the 1970 income tax) was quite small until the recent pension costs. And if you believe that you have been living in an alternative universe for those decades. And it is all PC. The most liberal of media outlets are quite willing to join this bandwagon. And that should tell us something very, very important. This issue will be regurgitated over and over again. Perhaps the ISC will settle this and the uproar will die. But I am not counting on even that. As noted, some mayors would love to be able to declare bankruptcy so as to primarily stiff the pensions so they can soon thereafter proceed with their usual spending patters. Anonymous- very insightful comments. - NewWestSuburbanGOP'er - Thursday, May 1, 14 @ 4:32 pm: @Judgement Day The munis HAVE NOT kept up with their payments. - NewWestSuburbanGOP'er - Thursday, May 1, 14 @ 4:36 pm: Anonymous @4:16 pm Right on! - RNUG - Thursday, May 1, 14 @ 4:39 pm: - Judgment Day - Thursday, May 1, 14 @ 4:24 pm: I don’t think it will get there, especially at the State level, for multiple reasons, including the facts that current state level pension funding payments are being made and that the Feds generally tend to keep hands off on actual State employment issues (State dealing with it’s own employees). I will admit some of the cities are in a lot more trouble than the State is. The more relevant question, I believe, is will the State (as proposed by Quinn) actually pony up some money to bail out various cities? - PolPal56 - Thursday, May 1, 14 @ 4:58 pm: Okay, so these municipalities would rather tarnish themselves with their BUSINESS creditors than figure out how to pay their obligations. The bankruptcy knife cuts all ways, as pensioners in Detriot found out. Do Morrissey and Ardis forget about business creditors? Maybe for mega-corporations it would be worth the ongoing attack toward public employees and retirees, but city bankruptcies will damage, perhaps destroy, many a small business. Especially if they start sprouting like mushrooms. How many small businesses work with multiple municipalities? - Judgment Day - Thursday, May 1, 14 @ 5:11 pm: “Maybe for mega-corporations it would be worth the ongoing attack toward public employees and retirees, but city bankruptcies will damage, perhaps destroy, many a small business. Especially if they start sprouting like mushrooms. How many small businesses work with multiple municipalities?” Actually, in some way, when a municipality goes into bankruptcy, the bankruptcy court tends to make accommodations for the little guys, because they are mostly all working in the ‘operations’ area. The municipality managers/appointed Bankruptcy Receiver just has to get the paperwork cut and submitted. It’s likely better than how a lot of vendors to the State of Illinois get paid. But it really depends upon how good your ‘team’ is. - 5-ohhhhhh - Thursday, May 1, 14 @ 6:52 pm: The average monthly Police Pension check in my jurisdiction is $2184. With no Social Security that’s not much to live off of monthly. - PublicServant - Thursday, May 1, 14 @ 6:58 pm: What all public employees need to do is stick together. That goes for police and firefighters. If the powers that be are allowed to divide the opposition, then they win. And, remember this, if they win this time, what makes you think because you sold out and cut yourself a slightly better deal this time, that they won’t be back again soon to deal with you in the near future? - PublicServant - Thursday, May 1, 14 @ 7:05 pm: The conference isn’t just a lobbying effort. It is an attempt to provide pre written opinions that judges could use to justify their ruling now that would stand in clear opposition to their previous rulings. This is an extension of the same tactics employed by ALEC in providing bought legislators with pre-written bills to introduce. - unionthuggramma (@unionthuggramma) - Thursday, May 1, 14 @ 7:21 pm: Hmm…seems like our judiciary is at least trying to look as they actually care more for justice than junkets. Time will tell. - Anon. - Thursday, May 1, 14 @ 9:29 pm: ==Then we have a ‘game changer’, because federal bankruptcy judges can virtually order anything.== True, but they won’t straighten out a government’s finances by cutting ONLY pension rights that are already earned. Those are debts on the same level with obligations owed to bondholders and vendors, who will also have to take a cut. That’s how bankruptcy works. That’s also why the “police powers” argument doesn’t work for the state’s pension reform — it only picks on one group of creditors. - Pacman - Friday, May 2, 14 @ 5:53 am: Lots of talk about bankruptcies. Other than Chicago what cities in Illinois are close to defaulting on their obligations? Or is this just fear mongering by politicians? I see no reason to rush through legislation for the cities until the ISC rules on whats already on the books. - RNUG - Friday, May 2, 14 @ 8:03 am: - Pacman - Friday, May 2, 14 @ 5:53 am: Everyone jumps on bankruptcy because that is the “accepted” solution in private industry. There the game plan usually looks like this: (1) sell / spin off / otherwise drain the company of as much cash and other assets as possible, (2) declare bankruptcy, (3) settle for pennies on the dollar while trying to dump pension obligations on the taxpayers (PBGC). Does that picture remind you of anyone currently running for office? - Joe McCoy - Friday, May 2, 14 @ 8:59 am: “The AFFI participated fully in legislative negotiations as Senator Terry Link unsuccessfully tried to hammer out a meaningful compromise among all parties involved. Unfortunately, led by their lobbyists at the Illinois Municipal League, the cities and municipalities walked away from negotiations.Senator Link’s package would have offered up short-term tax relief for homeowners. However, the IML walked out because the package included language that requires local governments to fund the required contribution mandated by State statute.” As the Legislative Director for the IML, the above contention comes as news to me. There have been several pension reform meetings to date since early April and neither the IML nor any other participants representing municipalities “walked out” of any of these discussions. If the above reference is about the 2010 negotiations that created a “Tier 2″ benefit structure for police officers and firefighter new hires, I can assure everyone that the IML and our partners fully participated in those negotiations through completion. Those negotiations culminated in the passage and enactment of SB 3538. - anon - Friday, May 2, 14 @ 11:56 am: It’s not just the politicians who are using bankruptcy for fear mongering. The unions in the We Are One Illinois coalition also employ the bankruptcy fear mongering by telling the members that they had better accept less than they are owed because they will have nothing if the fund goes insolvent. A blatant misstatement of all of the law regarding pension funds. Here’s from last week’s Henry Bayer email: “The Preckwinkle administration had been meeting with unions representing county employees for more than a year in an attempt to develop a shared solution to the underfunding problem that threatens the stability of the county pension fund.” Why am I supposed to “share in the solution” when the courts keep saying that I am entitled to get paid even if there is no money in the pension fund? Sorry, comments for this post are now closed.