* No revenue stream is reportedly in this plan, but the Sun–Times reports that a new pension reform proposal by Cook County Board President Toni Preckwinkle will “likely” pay for the $144 million in new state-mandated contribution costs with a property and/or sales tax increase…
(T)he bill would require all employees hired before 2010 to pay 10.5 percent of their salaries into their retirement, the source said.
That’s a 2-percent hike for most county employees, who currently pay 8.5 percent of their salary into the fund. The increase for sheriff’s office employees would be smaller because they already pay 9 percent.
Future retirees would have to wait two years after retirement to get a cost-of-living increase, the source said. And those cost-of-living increases — currently locked in at 3 percent — would fluctuate between 2 and 4 percent, depending on the rate of inflation
Additionally, all retirees would also have their cost-of-living increases frozen in 2016. And cost-of-living increases would be frozen in the future if the accounts dip below 59 percent funding, according to the source.
AFSCME is opposed, but SEIU Local 73 supports the bill’s “basic components,” the paper reports.
*** UPDATE *** From Crain’s…
“The funding of health insurance for retirees is a major gain, especially for those who are close to retirement and not eligible for Medicare yet,” according to a post this month on the website of Service Employees International Union Local 73, which represents Cook County workers and other government employees in the Chicago area.
According to another summary on a Teamster website, pension cost of living benefits would be suspended if the fund dips below 50 percent funding and would be increased if funding exceeds 100 percent.
But the cost of living adjustment for workers hired before Jan. 1, 2011, would remain generous by recent standards for pension deals, if the funding level remains between 50.01 percent and 99.9 percent.
According to the Teamsters website, the COLA would be at least 2 percent a year and up to 4 percent a year, depending on the consumer price index, and it would be compounded each year. If the funding ratio exceeds 100 percent, the COLA goes back to three percent, compounded annually.
“Just on the surface, it’s very generous,” said Laurence Msall, president of the Civic Federation, a Chicago fiscal watchdog group that advocates for pension changes. “It calls into question whether they get enough savings” from the proposed reforms.