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* House Speaker Michael Madigan appeared on the Illinois Lawmakers program yesterday after the budget address. He was asked about his pension reform plan.
“I’m not saying that we’re going to go back to a public employee and say ‘OK, there was a promise and now we’re going to take it away from you,’” Madigan said. He continued…
“What we’re saying is that there’s a benefit plan up in place up until today, but starting tomorrow, there’s going to be a new benefit plan that’s not going to be as rich as the old,” said Madigan, speaking on public television’s “Illinois Lawmakers” program. “Whether the Illinois Supreme Court approves this idea, that’s a matter for the court.” […]
“The conditions are such, given the overall condition of the state budget and state finances, that we should move forward with a well-thought out, constructive plan that would simply say, relative to everything that you’ve done up until today, promises made, promises kept,” Madigan said. “Starting tomorrow, there’s going to be a different program.”
* The Question: Do you support or oppose the concept of reducing future pension benefits for current state employees? Explain.
posted by Rich Miller
Thursday, Feb 17, 11 @ 11:50 am
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I have to support some type of reduction. It’s better for the employees to negotiate now than find themselves in a WI-type situation.
It is not their fault that the money was not being put into the fund. On the other hand, they knew of the issue and were afraid or too lazy to put pressure on the Unions, the State or City to contribute.
Comment by Aire Thursday, Feb 17, 11 @ 11:59 am
Support, but only if the current employee is not yet vested. It could be argued that the State does not owe a duty to pay employee pension benefits until an employee is vested in the System. Vested employees’ future benefits should remain protected from being diminished or impaired.
Comment by Feech Thursday, Feb 17, 11 @ 12:01 pm
Yes.
Times are tough and people have to make sacrifices. Frankly, they’re way ahead of the game just by still HAVING a defined benefit pension.
Comment by so... Thursday, Feb 17, 11 @ 12:01 pm
Madigan’s plan is needed and reasonable. Boy, I don’t say that every day!
Comment by parlimentary boy Thursday, Feb 17, 11 @ 12:04 pm
It is just plain reality that we cannot afford the generous pensions that were promised in the past.
Never was government employment supposed to be the golden ticket to a worry-free life after age 52.
Sure, many gov’t workers forgo richer compensation in the private sector to serve the public, but in the private sector they also work without a net. There are layoffs, salary cuts, 401k investments, mergers, and many other things that entail risk in exchange for that greater reward.
But the reality is also that many government employees are not brain surgeons or investment bankers who are toiling for the state our of a sense of service. (And I have worked for three state agencies) Most are working stiffs just like everyone else, except that their nearly worry-free careers and retirements are paid for by taxing the rest of the population.
No one will go hungry because they have to put up 30% of their health care premiums or contribute to their pension. They have to economize like everyone else.
All you lovely folks at DCEO, DNR, ICC, etc., etc., aren’t curing cancer. Get over yourselves and join the real world.
But the Republicans should be careful. If they make AFSCME and SEIU angry they could work to elect more Democrats.
Comment by Adam Smith Thursday, Feb 17, 11 @ 12:05 pm
The practice of freezing a pension plan and replacing it with another program has been common practice in the private sector for decades. Many companies eliminated their defined benefit plans and replaced them with defined contribution/401(k) plans.Employees at the time of the switch received benefits from both plans upon retirement. This is a long overdue change.
Comment by WRMNpolitics Thursday, Feb 17, 11 @ 12:07 pm
what Feech said.
Comment by amalia Thursday, Feb 17, 11 @ 12:08 pm
Benefits shall not be impaired or diminished,what part
Of that you dont understand race to the bottom
,i dont have one so you cant either
Fans?
Comment by foster brooks Thursday, Feb 17, 11 @ 12:08 pm
I oppose it.
As a state employee who has worked many years at pay scales that sometimes were just above the state poverty level and no where near the private sector the pension was one of the reasons I stayed. Now I am nearing the time when I can get what I have worked for it is to be reduced.
It is to be reduced by a individual who has a multimillion dollar side job that where he enjoys a ethically questionable position where his GA job could draw customers to his private enterprise. This individual exacerbated the present fiscal problem by postponing acting on it to preserve his own power base and to protect the jobs of his cronies. To me his actions are despicable and for him to dump on state workers to cover his own malfeasance is unforgivable.
Comment by Irish Thursday, Feb 17, 11 @ 12:08 pm
The system needs to be changed in order to make it more financially solvent for current and future retirees. I think that it should be scaled so that someone who is currently in their mid-fifties doesn’t suddenly have to work an extra 7 years to retire. The retirement age should be gradually raised.
The amount an employee contributes needs to be raised and I think this is the one thing that current employees would be the most supportive of doing.
Comment by Realist Thursday, Feb 17, 11 @ 12:09 pm
Oppose: it’s their fault the pension system is the way it is. They blew the money instead of putting in the pension system. You don’t hear them talk about their pension system where they only have to work 4 years and get a pension and 8 to get full health coverage!! I am a life long Dem and will vote them out!!!
Comment by furious Thursday, Feb 17, 11 @ 12:09 pm
If the employee receives the benefit negotiated for him in the current plan, then has a second pension beginning today, it would be fair. But to ignore the pension plan in effect now would not be what was guaranteed in the constitution. Otherwise a pension could be reduced to $100 a month and claim that met consitutional requirements.
Comment by Elliott Ness Thursday, Feb 17, 11 @ 12:09 pm
I support reductions in future benefits and making some retirees pay for health benefits. I also support increasing each state employee’s share of pre-tax earnings that is paid into SRS as well as increase to what each employee must pay for health insurance premiums. Continuing to allow a fiscally insolvent system to fester is a real concern. I know Judy & Dan may be against state’s bankruptcy rights, but what REAL options do we have if all players essentially refuse to sit down and talk like adults? The feds often pressure states into doing things they don’t want. If the state looks like a real risk to dump pension obligtations onto the PBGC, Congress won’t hesitate to take actions.
Comment by Team Sleep Thursday, Feb 17, 11 @ 12:11 pm
The argument that state pension needs to be the same as private sector ignores the fact that the private sector has been screwing the workers for years w/ fake and/or underfunded pensions ever since the phony/false idea was sold that a 401k is “just as good as” the defined benefit plan. The only beneficiary of the defined contribution plan was the business owner/stockholder. Fraud by any other name is still a fraud.
Having said that, there certainly does need to be some reconstruction of state pensions. But let us not pretend that it is on any basis other than that the state has committee malfeasance and misfeasance with the present system.
Comment by D.P. Gumby Thursday, Feb 17, 11 @ 12:16 pm
Oppose.
Pension reform is desperately needed and I do believe future benefits should be reduced. However, pulling the bait and switch on an existing employee, especially one who is vested, ain’t right.
Comment by Obamarama Thursday, Feb 17, 11 @ 12:18 pm
Absolutley support.
Public employees generally enjoy better pay and benefits and retirement than private sector employees doing similar work.
Comment by Downstater Thursday, Feb 17, 11 @ 12:19 pm
Yes. Support. Putting out a plan which clearly outlines changes/reductions to their future benefits and pensions will make it possible for current state employees to consider, and make informed decisions on whether they wish to continue working for the state. This is not punishment or a reflection of their worth. This is exactly the sort of analysis that employees in many other businesses and industries have been having to make for more than a decade as our savings plans, pensions and benefits are altered to reflect the economy and the realities of the business environment.
Comment by Responsa Thursday, Feb 17, 11 @ 12:20 pm
Speaker Madigan’s proposal is showing true leadership. What has been earned and promised will be honored. What will be earned in the future is up for debate.
Comment by The Truth Thursday, Feb 17, 11 @ 12:20 pm
Support it. I hope it will go beyond taking a look at employee contributions to health insurance. We need reform that prevents people from getting short term promotions at the end of their careers so that they can sweeten their pension. We need reform that prevents people from retiring, collecting their pension, and being hired on as a contractor to do the same job.
Comment by Aldyth Thursday, Feb 17, 11 @ 12:20 pm
The irony of this situation is that the same leaders who have underfunded the pension fund for many years are not the ones calling for reform. If you or I decided to take a holiday from our bills we would have big times problems. We couldn’t trust them to honor committments that they have made in the past. They have misled the taxpayers and the state employees. They haven’t talked about reform of their own pension system. What’s good for the employees should be good for the politicians.
Comment by Johnnie C Thursday, Feb 17, 11 @ 12:21 pm
Note to Irish,
If you are going to make an impassioned defense of the plight of the state worker, at least try to write it in English so as not to disprove your own point.
When my company got slammed by the recession almost everyone was given a pay cut, with higher cuts for top earners so as to maximize the savings. No one liked it, but it was what we had to do.
The lame protestations of state workers that they are so civic-minded fall flat when it comes to making sacrifice. It doesn’t matter who is to blame for this mess (legislators/unions/governors), the fact is that the solution demands sacrifice by workers. Period.
Comment by Adam Smith Thursday, Feb 17, 11 @ 12:22 pm
Yes. It does not take away any pension benefit earned in their current state service. It changes benefits prospectively. Employees can make the choice to stay in their jobs or seek new employment if they are not happy.
Comment by 4 percent Thursday, Feb 17, 11 @ 12:28 pm
Sounds to me that Madigan has got it right. Pinch me I must be dreaming.
Comment by mokenavince Thursday, Feb 17, 11 @ 12:29 pm
Adam Smith - Are you a brain surgeon? - I would assume so given your disdain for the working stiff. I work for one of the agencies you listed. I have to have a CDL, a waste water treatment license equal to those held by operators in middle size cities, (where they get paid more than I do,). I also am responsible for the safety of over 500,000 people per year, Licenses I have held for my job are, ambulance EMT, Prescribed Burn Manager, and Certified Pesticide Applicator/Operator, Water Supply Operator, Dosimetry Control Operator. I have taken college electrician classes, welding classes, computer repair, and computer software, have been trained in water rescue and cold water survival, have done numerous rescues of boaters in rivers and lakes. I have had training in dealing with drugs and drug users, and gang training, and that training has been utilized one more than one occasion. As an administrator I am also responsible for the training of my staff in rudimentary trade’s skills, the accounting of my budget, and over $80,000.00 in revenues generated from my area. To name just a few of my duties.
So before you go off on all you know about state employees you might want to learn a little bit more.
Comment by Irish Thursday, Feb 17, 11 @ 12:30 pm
I have taught at the University of Illinois for 31 1/2 years. For each of these years, the University gave me a take-it-or-leave-it package of compensation, some of which was in salary and some of which was in specific future retirement benefits. I realize that the benefits I can earn for future work may be changed. But if you don’t give me what you said you would, for work that I’ve already done, it’s theft, plain and simple. I recognize that many people in private industry have been already been victimized in this way. That doesn’t make it right. My calling it “theft” can’t stop the state from doing it, but theft is what it would be.
Comment by The old professor Thursday, Feb 17, 11 @ 12:30 pm
promises made, promises kept,” Madigan said. “
I guess not funding your portion of the pension counts as promises kept?
Comment by Leave a light on George Thursday, Feb 17, 11 @ 12:34 pm
I say do away with the legislative pensions. They are a PART TIME job and if there is ANY private sector job that allows me to get a pension after 4 years of part time work sign me up.
Comment by He Makes Ryan Look Like a Saint Thursday, Feb 17, 11 @ 12:39 pm
For current employees, besides some sort of cap tied to the CPI I would say no.
Comment by OneMan Thursday, Feb 17, 11 @ 12:43 pm
Support, yes. Find one person in the private sector today — one! — with an active, ongoing employer-still-contributing pension plan. Such a person is as extinct as the dodo, Mr. Irish. No one is saying take away what you’ve earned; rather, the idea is that the State can no longer afford to contribute further (which of course assumes it has in fact contributed what it’s supposed to have contributed in the past… but that’s another problem).
If the State can afford a defined contribution plan, great. If not, too bad.
I would make ONE exception, and that for State Police. Locally, I would except police and fire. These should continue to have guaranteed pensions if it can possibly be done.
No one else.
Comment by Anon. E. Moose Thursday, Feb 17, 11 @ 12:45 pm
It is like the legislation that created caps for malpractice verdicts. The concept had been found unconstitutional on 2 prior occasions. If they knows it will be found unconstitutional by the court, then it is just a game for Madigan. What is probably needed is a constitutional amendment.
Comment by blogman Thursday, Feb 17, 11 @ 12:46 pm
Here’s the problem with the Speaker’s proposal. Let’s say the General Assembly comes up with a plan to reduce future benefits - they do what the Speaker proposes and pass legislation that provides that you are entitled to what you have earned to this point, but the time you put in from this date forward will earn less towards your pension. I suspect that the first thing the General Assembly will do is reduce contributions to the pension funds, based upon the anticipated reduction in the future pension payments that the systems will be required to make in light of the reduction of benefits. Now someone will certainly sue and contend that under the constitution the reduction is impermissible. What happens if ultimately the Supreme Court decides a few years down the road that the reduction was impermissible? In the interim, the pension systems have been underfunded. There would be a fiscal mess that would have to be cleaned up because of that underfunding.
If what the Speaker is suggesting is that the General Assembly makes the change, but continues to fund the pension funds based upon actuarial projects based upon the current pre-change system then that’s fine. At that point, if the Supreme Court upholds the change then pension funds will be nicely funded. If the Supreme Court rejects the change, the pension funds will have been adequately funded in the interim. Being a cynic about the General Assembly, I suspect that the General Assembly won’t wait for the court to rule and will immediately take advantage of the “savings.”
Comment by Just the Facts Thursday, Feb 17, 11 @ 12:47 pm
Support. Neither the federal nor state constitution, nor contract law, entitles employees to continue to accrue benefits in the future in the same manner as in the past. For at-will employees, the law entitles them to what they have already earned to date, but not to continue earning any new benefits tomorrow. Unionized employees may continue earning benefits under their current agreements, but nothing entitles them to continue earning benefits after their agreement expires. I think most people agree that there are provisions of the pension code that should be cut back (early retirement and general assembly pensions, anyone?), the real issue is which ones and how much, and the whole thing should be re-examined going forward.
Comment by Pat Robertson Thursday, Feb 17, 11 @ 12:52 pm
Absolutely. Give them the value of what they have accrued so far, but don’t accrue any more at the same rate. And except for the most hazardous of jobs, don’t pay people to retire at an early age. People are living longer and longer, and as a society, we can’t have people quitting work at 55 and living another 40 years off of the efforts of others.
Comment by ChicagoR Thursday, Feb 17, 11 @ 12:56 pm
Anon.E.Moose - Shell oil, the auto manufacturers, the large pharmecuetical companies to name just a couple still offer pension plans.
Comment by Irish Thursday, Feb 17, 11 @ 12:59 pm
As I mentioned in the comments to yesterday’s State budget coverage roundup post, I support a reduction of pension benefits even as a state university worker that stands to benefit the most from it (retire with a pension at 80% of pre-retirement income when I’m 50).
Comment by thechampaignlife Thursday, Feb 17, 11 @ 1:02 pm
Anyone born after 1955 should have learned by now that they will get screwed. The Baby Boomers repeatedly consume everything in its path, leaving nothing behind. We have repeatedly seen over a lifetime following this group that they are the “last” generation to get the benefits from the selfless generations before. The ME generation.
We have always been on our own. If Rich Miller was a generation older, he would have been a newspaper god. Had he not recognized that he was on his own he might now be out of print and out of luck. Its always been that way.
Unsurprisingly, we will be screwed again by on this too.
We have no real choice. Just stop wondering why my generation is so skeptical about the status quo.
Comment by VanillaMan Thursday, Feb 17, 11 @ 1:02 pm
Support. It’s necessary. But include the legislature and the judges. And everybody else in the public sector. It can’t just be SERS.
Comment by Excessively Rabid Thursday, Feb 17, 11 @ 1:07 pm
@ Just the Facts
=== If what the Speaker is suggesting is that the General Assembly makes the change, but continues to fund the pension funds based upon actuarial projects based upon the current pre-change system then that’s fine. ===
One way to accomplish this might be to close out participation in current funds effective upon expiration of a current collective bargaining agreement, or at the end of current calendar / fiscal year for employees not covered by collective bargaining.
All benefits accrued under old system would be fully guaranteed by State of Illinois and perhaps vesting rules might need to be liberalized on a one time basis to fully vest accrued benefits under old system to smooth transition to new system.
Then, upon commencement of the new collective bargaining agreement, employees are enrolled in a newly created pension fund with new rules.
Comment by Bill White Thursday, Feb 17, 11 @ 1:07 pm
Rich not an answer to your question but an update on Wisconsin. The Senate Democrats have walked out of the Capitol and are rumored to have left the state to prevent the necessary quorum need to vote on Walker’s bill.
It seems while Walker was down here dissing Illinois the workers in his state were revolting.
And to the QOTD my answer is no to reducing benefits for current employees.
Comment by wndycty Thursday, Feb 17, 11 @ 1:09 pm
If the State had paid into the system like the Illinois Supreme Court ordered them to do, we probably wouldn’t be having this conversation. And yes, this is not a Democrat only problem - it started with Jim Edgar and Jim Thompson.
One problem that I see that no one has mentioned is this. There are thousands upon thousands of current State employees who are eligible to retire, but stay working because their retirement increases each additional year they work. Take away the ability for their retirement to increase and I predict a HUGE number of current employees will retire before a new pension plan kicks in.
Now, this will help the State in one area because these employees can be replaced with less expensive new-hires with a less lucrative pension plan.
But, the catalyst that started this whole fiasco is an improperly funded pension system because the State won’t (and now can’t) pay its share.
And, if a large number of current employees retire, the stress on the pension fund will cause a whole new raft of problems.
Properly funding the pension plans for all State employees and teachers MUST be a part of any new pension system proposal.
Comment by Jechislo Thursday, Feb 17, 11 @ 1:11 pm
Irish - And if those companies or pension fail, guess who picks up the bill. Taxpayers.
System needs reformed. Long overdue. How about a tiered implementation? Example, employees:
0-5 years = X
5-15 = X
etc. Those already vested or to be vested by June 2012 don’t get touched.
Comment by Anonymous Thursday, Feb 17, 11 @ 1:17 pm
Normally I am a big fan of cutting costs but I am concerned that we are turning this country into a big walmart. Do anything to cut costs without regards to who it hurts just to save a buck. I am no big fan of unions but what is happening in Wisconsin is just wrong, where does it stop. Maybe the City of Chicago could get illegals to pick up the trash for minimum wage and no benefits, I bet we could get some prison labor to fill potholes. All while giving millions in tax breaks to corporations
Comment by fed up Thursday, Feb 17, 11 @ 1:17 pm
I believe that in order to get the budget under control we need to look at serious pension cuts (like these) and look into our states medicaid problems
Comment by we are out of money Thursday, Feb 17, 11 @ 1:23 pm
@ Jechislo
=== I predict a HUGE number of current employees will retire before a new pension plan kicks in. ===
Agreed and the actuaries will be busy.
=== Now, this will help the State in one area because these employees can be replaced with less expensive new-hires with a less lucrative pension plan. ===
Wouldn’t that lower unemployment and help out the younger generation? Meaning its a feature on multiple levels rather than a bug.
=== Properly funding the pension plans for all State employees and teachers MUST be a part of any new pension system proposal. ===
Absolutely agree, 100%
Comment by Bill White Thursday, Feb 17, 11 @ 1:27 pm
Yes but only for those more than 15 years away from retirement. Anyone closer has already prepared their lives on the basis of the promise they were given.
Because private enterprise does it is not a good recommendation in my eyes. The wonderful private sector has resulted in flat lined wages and thread bare benefits. If the private sector has to compete with a public sector that offers fair benefits, then that strikes me as a good thing. If nothing else, it should result in the state getting the best and brightest of the available employee pool.
Comment by cermak_rd Thursday, Feb 17, 11 @ 1:28 pm
No. It would be impairment and diminishment of the pension benefit package offered upon beginning employment and therefore unconstitutional.
Comment by Bill Thursday, Feb 17, 11 @ 1:32 pm
windycty– since you went somewhat OT– I will, too. See how proud you feel about some of these protest posters from WI yesterday:
http://hotair.com/archives/2011/02/17/the-historical-illiteracy-of-wisconsin-teachers/
Also, there is apparently a door to door search being conducted to locate the “missing” legislators. How mature! Rich, I will understand if you delete, but WI and Walker and Hitler have been frequent topics on this blog!
Comment by Responsa Thursday, Feb 17, 11 @ 1:34 pm
I see you just opened a new thread on this, so I guess it is not off-topic.
Comment by Responsa Thursday, Feb 17, 11 @ 1:37 pm
Irish,
I worked for three state agencies in Springfield and Chicago and have worked closely with several others. I would hazard I know a fair amount about state government.
The only disdain I have is for those who think they are entitled to gold-plated benefits that everyone else has to pay for and that are not economically sustainable.
Thanks for keeping an eye on state parks for us, but don’t kid yourself that you are somehow saving the world.
Comment by Adam Smith Thursday, Feb 17, 11 @ 1:39 pm
I support it. It’s fair and necessessary to help the state reduce year over year spending. As long as benifits earned todate are kept, it’s very fair.
Comment by Ahoy Thursday, Feb 17, 11 @ 1:39 pm
I agree with the approach, that is, getting the answer from the Supremes (probably the federales bench, too) as soon as possible.
All the wiseguys at the Trib say it can be done. Let’s find out.
Beats calling up the National Guard and conducting house-to-house searches.
Comment by wordslinger Thursday, Feb 17, 11 @ 1:39 pm
It’s important to note for those who have said that rank and file state employees get a rich pension, they should look at the numbers more closely. Please don’t lump us in with the judges and legislators. Their pensions are much more lucrative that most. They also constitute a minority of recipients. However, their pension plans do receive far more press coverage due to the higher payout they receive. Especially those who are able to sweeten their deals with special, past minute, bumps. Since state employees pensions are seperate from teachers pensions it can also be noted that their pensions are higher. If I am correct, tho, they don’t receive SSA as we do. Perhaps it’s a wash - I don’t know. The point remains, state employees pensions, in general, are not as lucrative as other retirement plans
Having said that, it seems pretty clear that since MJM is talking about it the changes will likely come. It also seems that MJM is planning on holding PQ to the spending limits put in place with the recent tax increase. We can only stand by and watch as this unfolds - like it or not. From many previous blog entries here is seems clear that future benefits are fair game. I know Rich as commented on that many times - a point I remember well.
State employees, such as myself, should come to the realization that cuts are gonna happen. I think we should take step up and accept them with grace. Let’s face it, state employees receive a defined benefit pension - different from the 401Ks that many folk have - more susceptible to market fluctuations. That alone must factor into our stance as state employees. It will only make us look better and take the bullseye off our backs.
Comment by dupage dan Thursday, Feb 17, 11 @ 1:41 pm
You could not have said it better. This is awful. Government at its worst.
Comment by Irish - I agree Thursday, Feb 17, 11 @ 1:48 pm
It’s ironic that Madigan is leading the charge here. More than any other state leader over the past 20 years, he is responsible for the multiple pension sweeteners, special interest deals, and underfunding that’s led us into the current mess.
Comment by Chicago Dem Thursday, Feb 17, 11 @ 1:48 pm
I challenge anyone to name a single person NOT riding the state gravy train at our expense who is against reducing future benefits.
Oh, and better include persons with a state worker spouse in that too.
Comment by just sayin' Thursday, Feb 17, 11 @ 1:49 pm
I support the Speaker’s viewpoint. Better to lose a little now than a lot later. If reducing future benefits keeps the system solvent, as another Speaker said recently, so be it. Keep what we’ve earned so far — this has to be ironclad — but reduce benefits going forward. I think this would pass legal mustard and I could live with it if that’s what has to be. However, I think we as a society are engaged in a race to the bottom when it comes to jobs and pay and social benefits.
Comment by My2cents Thursday, Feb 17, 11 @ 1:51 pm
Absolutely Oppose reducing future benefits for current employees. Here are some things to consider:
The “crisis” is of the legislature’s making – not public employees.
The existing public employees entered, (and stayed in), state service based on the rules of the game as they were….they are now committed to the game…can’t change the rules in the middle of it.
Public service professions are essentially in “monopolies”, so they are essentially “captive” (teachers, police, fire fighters, prosecutors, etc.)
With many older pension plans, there is NO social security.
Need to consider the phone state worker “headcount” reductions that replace public workers with more costly private-sector ones along with the effect of the reduced state-worker contributions to the pension funds that accompany this scam.
Comment by JustaJoe Thursday, Feb 17, 11 @ 1:56 pm
fully support it. 100%. Further, even as a democrat, I generally support Scott Walkers plan up in WI
Comment by matty Thursday, Feb 17, 11 @ 1:57 pm
In my comment above “phone” = “phony”. Sorry.
Comment by JustaJoe Thursday, Feb 17, 11 @ 1:59 pm
@JustaJoe,
Joe, it doesn’t matter that the GA is to blame for the underfunding of the pension. We all know that to be true. We can also blame the voters for continuously re-electing those who shortchanged the pension in favor of voting for more of the programs and entitlements that are costing this state so much. It’s all true and it doesn’t matter. What does matter is perception. And the perception of state employees right now is that they have to step up and do their part to help reduce costs. With MJM taking the lead it will be impossible to change the perception. It will only make us state employees look like whiners and crybabies. Better to take our lumps now (within reason - I ain’t no pushover) and accept our loss with grace. The focus will hopefully move elsewhere and we can lick our wounds and be thankful we still have our jobs.
Comment by dupage dan Thursday, Feb 17, 11 @ 2:05 pm
As I said before (and to the dismay of others who thought I was incorrect), many pensioners (teachers, judges, and others) do not contribute to social security; their pension is set up in such a way that the pension is their only safety net, outside of a private 401k. If you take away the pensions they have been relying on, there is no social security payment to help them make ends meet.
Comment by the Dark Horse Thursday, Feb 17, 11 @ 2:16 pm
I worked for the state for 20 years and for a good amount of those years, probably 15 of them, I FUNDED MY PENSION. I must be missing something very big here when I see people complaining about about State funded pensions. The state worker funds their own darn pension. .
Comment by Former State Employee 2 Thursday, Feb 17, 11 @ 2:17 pm
Oppose. Full disclosure: I’m vested in SERS. If the GA does this, and if the courts rule they can, they will reduce benefits every time money is short or they want some fancy new program - this will not be a one-time thing. I’ll have no ability to plan for my retirement, because I’ll have no way of knowing how my pension will be hit from year-to-year. I’ve given up on expecting Social Security, the Boomers will kill that. This is what I’m counting on and am planning my retirement savings around. It’s also the chief reason I chose, and continue to, work in the public sector instead of the private.
Comment by TwoFeetThick Thursday, Feb 17, 11 @ 2:20 pm
For all those state employees who complain that they won’t be able to plan their retirement as well since they won’t know what their income will be from year to year. Welcome to the real world. I have several family members who are self-employed and, due to the economy, they have had to sacrifice their savings to keep their businesses afloat. They have had to mortgage their homes to keep their businesses afloat. They do know one thing, tho. They do have certaintly about when they will be able to retire. They know for certain they will NEVER be able to retire. They will have to work until they drop. How’s that for retirement security.
From one state employee to another - there are plenty of these stories out there. These are the people who vote. From talking to them I know how they perceive state employees. Please stop whining and accept the reality. You are making us look like a bunch of whiners. And let me tell you, We. Are. Being. Watched.
Comment by dupage dan Thursday, Feb 17, 11 @ 2:33 pm
Oppose. I have paid my share over the past 30 years; no social security benefits accrued; started in the public sector knowing the “rules of the game”, and have taken less pay over the past 30 years than my private sector friends. Rome is burning and who is playing the lyre?
Comment by Nero Thursday, Feb 17, 11 @ 2:45 pm
Is Madigan signally his own retirement? I’m sure he will want to retire before the new law takes effect? Fine for state employees. What about systems which are not coordinated with Social Security like TRS and SURS, who contribute 8% or more into these systems?
Comment by SURS Member Thursday, Feb 17, 11 @ 2:52 pm
for those aising the point about private sector pay keep this in mind; in the private sector employees in management get bonuses,frequently worth millions of dollars. So if we want private secotr type compensation for benefits like 401(k) plans, then lets do private secotor compensation. Bonuses for high level managers (even when the business is in bankruptcy, to keep the talent).
its settled then, we reduce pensions and implement bonuses.
Interestingly enough Madigan does not discuss how the ggeneral assmebly works less then part time compared to most workers, recieves full pay (even if they do not come to work); and how thye most generous pension system of any, there payout is based on last day pay, not conributions or an average of earnings. Oddly madigans caps secure for the general assembly full pension benefits at less then part time work as the caps he is proposing are high enough not to impact is people.
How about this, the generl assembly is paid for the hours they work with their annual salary amount being a cap on the amount they can earn. And their retirmenet formula requires 2000 hrs work to get 1 year of service, the pay out is based on an average of the highest 4 years of the last 10, and they have to meet the rule of 85 based on hours worked.
Comment by Ghost Thursday, Feb 17, 11 @ 2:55 pm
Yes, dd, I’m just a whiner. I haven’t made any life choices based on what I thought I could count on. It’s all my fault, I should’ve known better than to expect promises made to me would be kept. I should just suck it up and head to the bread line like everyone else. Resistance is futile. Bite me.
Comment by TwoFeetThick Thursday, Feb 17, 11 @ 2:57 pm
i am a recently retired state employee (35 yrs, 58%). i oppose madigans proposal, but i understand it.
strategically, he is the first to go full bore at the biggest issue the business groups are harping on-reining in state employee pensions. that should help him and his members with those folks, outflank the republicans flailing around about cuts, and offset some of the sting of the income tax increase. the business guys have already provided the sidley and austin opinion. cross’ proposal tries to be all things to everyone.
constitutionally, the GA can increase health care costs for current retirees–the courts have already said they can.
cutting pension benefits for current retirees is directly contrary to the constitutional protection. setting up a new benefit structure for current employees is iffy, but has some support in con con debates and early pension laws commission reports. drafting it can be tricky. but madigan wins in any case — for trying if the bill fails; for getting it passed and enacted if he can pull that off; and even if it is overturned. and it is a slap at the unions for crossing him. it softens things up for going after health care costs.
the general population is starting to pay attention to this stuff, which previously was inside baseball.
madigan wins even if nothing makes it all the way. so what else is new.
Comment by Langhorne Thursday, Feb 17, 11 @ 2:59 pm
TwoFeetThick,
You apparently didn’t read anything more than my whiner comment. You are entirely right in your stance. I agree with your stance. It is the perception of state employees on the part of the voting public that is the issue here. Not your righteous indignation.
Comment by dupage dan Thursday, Feb 17, 11 @ 3:01 pm
Support! And add taking a look at reducing personal days or sick days. Make employees take the sick days and vacation days or loose them at the end of the year.
Comment by waitress practicing politics. . Thursday, Feb 17, 11 @ 3:07 pm
I’m sympathetic to state employees, I really am. The Gov and GA have shorted the pension funds for a generation, and now the bill is due. What Madigan is proposing is the least worst choice available.
I think a lot of this is the result of macroeconomic issues beyond our control. The world changed. Wages have been stagnant for decades. The private sector has been cutting back on pensions and health benefits for 30 years. Even the federal government figured out its pension funds were unsustainable in the 1980s and got out of them.
Because everyone else has seen less retirement security, public employees are now standing out and getting noticed. You’ve become the new welfare queens, even though you’ve done nothing to deserve it. Everyone else has seen their incomes and retirement packages slashed, and now we’re jealous of your deal.
We can’t recover what we lost, so we’ve decided to take away yours too, to bring you down to our level. It was never a gravy train, but it’s over now. Madigan’s plan, if the courts go along with the idea, needs to be implemented as fairly as possible, but the whole stinking macroeconomic problem is unfair. This is the least bad option in my opinion.
Things are tough all over.
Comment by 47th Ward Thursday, Feb 17, 11 @ 3:08 pm
Oppose.
However, since it seems that many consider individuals who choose to serve the public interests by employment with a state, municipal and even federal agencies, why stop with just state employees?
Why not extend it to those that chose the National guard, military, or organizations like AmeriCorps? Poor example some say, well I would have included firemen and police but someone here already granted them clemency.
And you can be sure they will never change the legislators parachute, I mean retirement package for it’s “bleepin” golden…
Comment by LINK Thursday, Feb 17, 11 @ 3:09 pm
I am a former state employee who is working in the private sector and drawing both a pension check and a paycheck. I would love to see the SC rule on the constitutionality of the “diminishment” issue for current employees; I expect the pension is probably as safe as can be expected for retirees, but I would also like the SC to rule on whether cutting the 3% annual COLA is “impairment” also. There is precedent with a well-known lawsuit by the state judges where they won the right to get a pay raise based on another “impairment” clause in the state constitution.
And I would not be opposed to paying more for my health insurance, which I opted to keep with the state.
For those who claim the public sector is better compensated, in my case, it ain’t even close - private sector pay is better. But, as always, it depends on what field you are in and your degree of expertise and your value in the marketplace.
Comment by Six Degrees of Separation Thursday, Feb 17, 11 @ 3:15 pm
Absolutely oppose. I am a CPA with a graduate edge in accounting and a lawyer who has accepted a much lower salary to teach in a graduate tax program. One of the reasons I took the job as a professor was the pension program. I have performed my part of the bargain for 29 years. For the state to change the rules going forward is a breech of contract.
Great damage will be done to higher education in the state. Professors compete in a national market. Our pension benefits have always been just average compared to other states. We are having trouble receiving new people into Illinois as a result of the two tier system. If we end up with a revised system for current employees, bright mobile people will leave the state for greener pastures.
Remember we are in this bind because the state did not do their share. It is not logical to now somehow blame state employees who put in their contribution each and every month.
Comment by Siuprof Thursday, Feb 17, 11 @ 3:17 pm
Ok, dd, how’s this: “Thank you, sir, may I have another?”
I don’t care much what misinformed people choose to believe about me as a state employee. I do care when their misperceptions threaten my livelihood. I do not agree with the feds that have allowed private employers to walk away from their pension obligations. I do not want that to happen to me. I am tired of hearing how rich I am, and lazy, and how I should just shut up and be happy I have a job. That’s all, I’m done.
Comment by TwoFeetThick Thursday, Feb 17, 11 @ 3:19 pm
The problem with the arguement that it’s not the employees fault the state screwed up the pension system is that it’s really pointless to lay blame. No matter what happened-it happened. All you can do is fix it.
Comment by Phineas J. Whoopee Thursday, Feb 17, 11 @ 3:28 pm
Adam Smith@1:39 - first of all I am not “keeping an eye on State Parks for YOU.” and I have no illusions that I am saving the world. ( your words not mine)
What I am doing is my job and living up to my side of an agreement where I make contributions to my pension and my employer is supposed to do the same. I have lived on pay that was lower than workers in the private sector and accepted it because of the promise of a livable pension. I have forgone pay raises in an effort to help balance the budget. I am giving up furlough days to help with the fiscal deficit.
My employer has, taken money from my pension part of which I contributed and spent it on other things.( No one from the public cried out against this because my money was being used not theirs.) My employer has, not paid their share into the pension fund because they wanted to use it for other things. ( No one from the public cried out against this because my money was being used not theirs.)
When I was not getting raises for the good of the State. The GA was bumping their salary beyond the COLA.
When I am giving up pieces of my earned pay for the good of the state the GA is making every move to ensure they give the very least.
And now the leader of the GA who has done absolutely nothing to solve this fiscal mess and everything to perpetuate it wants to break the promise made to me and many other state employees.
And he unabashedly spins it so that if the employees come out against it they look greedy and he never mentions his duplicity in creating the mess nor does he apologize for it. When he is willing to make sacrifices equal to those the serfs have made I might be more inclined to listen to him.
BTW - your writing indicates that you carry some hard feelings against state employees, especially those in the tourism facet of State government. Bad experience in Springpatch of Chicago?
Comment by Irish Thursday, Feb 17, 11 @ 3:33 pm
I absolutely OPPOSE changing future benefits for current state employees. First, I believe it to be clearly unconstitutional. Second, I was promised certain benefits when I began work and have planned accordingly. To change the rules mid-game is immoral, unfair, and again, I believe, highly illegal.
Comment by Demoralized Thursday, Feb 17, 11 @ 3:38 pm
Oppose given the current discussion. There are a lot of different public pension systems. They have different benefits. Any discussion need be system by system. The discussion need recognize that at least some of the savings from any change in pension systems would be offset by increases in base pay. A lot of government jobs are very technical and have to be compete in market. Changes in the Teacher’s Retirement system might require the state to contribute to social security. There are a lot of factors at play here and are not being considered. In any event Defined Benefit Plans are not dead.
“According to the Pension Benefit Guaranty Corporation, there are about 38,000 insured defined benefit plans today compared to a high of about 114,000 in 1985. They go on to state that this decline was due primarily to plans with 100 or fewer participants. One possible reason for this decline is the complexity and cost required by many of these plans.”
http://www.irs.gov/retirement/article/0,,id=108950,00.html
Comment by Bigtwich Thursday, Feb 17, 11 @ 3:46 pm
I oppose changes to the pension for existing state employees. I believe that individual lawsuits are necessary because AFSCME cannot be trusted.
Comment by Ready to sue Thursday, Feb 17, 11 @ 4:05 pm
Funded or not, I think the issue is more about the total compensation and benefits package being viewed as too generous by the public at large. It would be really nice to see a comparison of lifetime earnings including benefits and taxes between some typical state employees and their private counterparts. That would involve some assumptions but reasonable estimates can be made from actuarial tables and the like. It’d be nice to see an apples-to-apples comparison before any course of action is chosen since everything seems so anecdotal so far. My own experience is that my benefits and compensation package is overly generous but I’d understand others that may be in a different situation. Sure would be nice if we could have a uniform benefits package across all employee groups!
Comment by thechampaignlife Thursday, Feb 17, 11 @ 4:06 pm
average SURS annuitant is making 27k on their pension–with no social security. I wouldn’t call that a “rich” deal
Comment by surs Thursday, Feb 17, 11 @ 4:11 pm
Demoralized,
I suggest you read 47th Ward’s post on the matter. Your dismay at being shortchanged, while understandable, does not go well with the electorate. I, as a state employee agree with you that it ain’t fair. The pension shortfall is not our fault. However, the perception on the part of the public is not favorable to our position. MJM is on our tail. It’s a done deal, folks (pending a final state supreme court decision, of course).
Comment by dupage dan Thursday, Feb 17, 11 @ 4:11 pm
=AFSCME cannot be trusted=
Here come the koolaid drinkers.
Comment by dupage dan Thursday, Feb 17, 11 @ 4:13 pm
Why is Madigan getting the credit for reforming pensions? It is Cross’s legislation.
Comment by Gopper Thursday, Feb 17, 11 @ 4:28 pm
I think we waste our time arguing about constitutionality. If changes are made, we will find out.
And that’s what concerns me most about making changes. I’m afraid the finding out will take a long, long time. Grievances, then state and then federal Labor Relations Boards complaints, then state courts, then federal courts,ad infinitum. And waiting to see what the courts say will become the excuse for doing nothing else in the meantime.
BTW, I have long supported retirees paying some income-based premium for health insurance. I don’t believe many should get their insurance for free.
Comment by steve schnorf Thursday, Feb 17, 11 @ 4:29 pm
Oppose. As a number of people noted, the State employees (SERS) did nothing wrong and do not get the big benefits.
If the problem is public perception, then it is time to go on the offensive with advertising. The facts are on the side of the State employee. We paid; the taxpayer (via their legislative representatives) didn’t. Tar and feather the legislature in print for not making the contributions that should have been made. Drag out the charts and graphs showing where things would stand if the contributions had been made (not perfect but much better than today’s situation). Will the State employee win this fight? … probably not, but until you start to fight the disinformation campaign going on today, you’re guaranteed to lose.
If push does come to shove and the State employee is forced to take a haircut, then follow Federal pension vesting rules … 8 years and you are entitled to the pension … and under those conditions there won’t very much savings. And the State should be forced to immediately contribute the entire backlog of funds owed (estimates range from $70-130B) to the pension systems (OK, that is obviously unachievable and snark but so are a lot of the comments aimed at State employees).
Comment by Retired Non-Union Guy Thursday, Feb 17, 11 @ 4:39 pm
So if the state can just change the rules of the game, what about other state-backed obligations such as College Illinois. If the money isn’t there at some point as promised, can the state just say too bad you’re screwed?
Comment by Anonymous Thursday, Feb 17, 11 @ 4:44 pm
===what about other state-backed obligations such as College Illinois.===
In theory, yes. The state could say, OK, you’ve paid 50 percent of the total tuition cost as set way back when. From now on, however, your payment rate will increase for the next 50 percent.
Comment by Rich Miller Thursday, Feb 17, 11 @ 4:48 pm
Oppose. Depending on the final retirement formula, there may well be a mass exodus by many long term state employees that are already eligible to retire, resulting in a further brain drain at many state agencies. There are already rumblings about this at a couple of agencies. With already low staffing levels there are some important programs and services that will suffer even more.
Comment by 13 Thursday, Feb 17, 11 @ 5:08 pm
Support.
I used to work for a Dow Industrial that did the same thing. Changing the rules in the middle of the game hurts, but if the company had gone under, everyone would have lost everything. Then what?
However, the State of Illinois, like many companies, was foolish to make pension promises that couldn’t be kept. The iceberg was clearly in view years ago, and we did nothing.
Comment by Regular Reader Thursday, Feb 17, 11 @ 5:17 pm
–We have no real choice. Just stop wondering why my generation is so skeptical about the status quo.–
Poor guy. Life in the salt mines is harsh.
What generation is that, anyway? Generation X or Generation YYYYYYYYYYYine?
Comment by wordslinger Thursday, Feb 17, 11 @ 5:17 pm
One additional thought. The last time the State made a change in existing pensions going forward was 1972 or 1973. At that time, still employed SERS participants were offered a voluntary choice: remain on the more generous “original” State pension system with no Social Security or convert to the “new” State pension system that was less generous but included Social Security. All new hires were automatically included in the split system. People who chose to remain on the old system kept that system until they retired.
It’s about 40 years old but it is the only precedent we have exactly on target, i.e., Illinois State employees and future pension benefits. Using the above change as precedent, you can change pension benefits going forward on a voluntary basis … but you can’t change them on an involuntary basis. It cuts both ways, but it favors the existing employee’s right to continue to accrue pension benefits using the rules they were hired.
Comment by Retired Non-Union Guy Thursday, Feb 17, 11 @ 5:37 pm
I agree something must be done, but putting it in the hands of the very people who okayed the current system, didn’t pay the bills for the current system seems to be a recipe for disaster yet again. I would be even more supportive if the GA put themselves at the forefront, reducing their own benefits and pensions.. Anyone want to bet on that??
Comment by Steamer Thursday, Feb 17, 11 @ 6:09 pm
@dupage dan:
I frankly don’t care what the public thinks because on this issue they are all idiots. I don’t receive a lavish salary, have to take furlough days, and my pension is not going to be “gold plated.” I have paid into the system. I am entitled to what I paid for. The public can go to heck as far as I’m concerned.
Comment by Demoralized Thursday, Feb 17, 11 @ 6:18 pm
@ steve schnorf:
Since when is it a waste of time to argue about the constitution? Only those who have no respect for it would say such a thing. Perhaps people should try and abide by the constitution and the laws of the land once in a while in this state. Your old boss is in jail b/c he couldn’t seem to grasp that concept. So is our last Governor. Seems like we could all benefit from some law abiding politicians.
Comment by Demoralized Thursday, Feb 17, 11 @ 6:20 pm
Demoralized, are you wacko? I said there wasn’t much need for us non-lawyers to argue about whether this was constitutional or not because the courts would tell us.
Comment by steve schnorf Thursday, Feb 17, 11 @ 6:37 pm
– Your old boss is in jail b/c he couldn’t seem to grasp that concept. So is our last Governor–
And your mother wears Army boots. That’s reasonable, right?
In all fairness, I believe there’s only one former governor in prison (not jail).
b/c? Is that another text abbreviation I don’t understand? I hate new media.
Comment by wordslinger Thursday, Feb 17, 11 @ 6:42 pm
To Whom It May Concern
April 13, 2010
The March 10, 2010 Tribune Op-Ed Don’t Call this Pension Reform by R. Eden Martin of the Civic Committee of the Commercial Club of Chicago and the March 27, 2010 Tribune Editorial, Yes You Can claim that Governor Quinn and the General Assembly should have gone further in bringing pension reform to Illinois by reducing the pensions not only of new employees, but of existing employees as well. My colleague, John Fitzgerald, and I have looked closely at this important State issue, and our conclusion is inescapable – as a matter of law, the pension rights of current employees simply cannot be diminished as Mr. Martin and the Tribune contend. (Our legal analysis is below)
The plain language of the Illinois Constitution’s Pension Protection Clause (Article XIII, Section 5) states that, “Membership in any pension or retirement system of the State . . shall be an enforceable contractual relationship, the benefits of which shall not be diminished or impaired.”
As courts in this State have confirmed, this language is crystal clear. Public employees become members of a pension system at the time of hire or shortly thereafter and once they become members, their pension rights are set and cannot be “diminished or impaired.”
This is exactly what the framers of the State’s 1970 Constitution intended. At the Constitutional Convention, one of the co-sponsors of the Pension Protection Clause succinctly illustrated the point: “Benefits not being diminished really refers to this situation: If a police officer accepted employment under a provision where he was entitled to retire at two-thirds of his salary after twenty years of service, that could not subsequently be changed to say he was entitled to only one-third of his salary after thirty years of service, or perhaps entitled to nothing.” Not surprisingly, as it noted in a 1996 decision McNamee v. State of Illinois , the Illinois Supreme Court has “consistently invalidated amendments to the Pension Code where the result is to diminish benefits” to which State employees acquired a vested right when they entered the pension system. Legal analysis that Sidley Austin LLP performed for the Civic Committee glosses over this controlling authority, misconstrues a comment that the Illinois Supreme Court made in a 1974 decision (which has been distinguished in subsequent cases), and incorrectly relies on a 1979 Illinois Attorney General opinion that has been trumped by subsequent Illinois Supreme Court decisions.
Any pension reform effort will depend on the strength of its legal foundation. The Governor and the General Assembly have been careful to comply with the Illinois Constitution’s Pension Protection Clause, as well they should. The alternative would be a short-lived pension reform that is invalidated by court order after protracted litigation, which would be a disservice to the taxpayers.
Comment by foster brooks Thursday, Feb 17, 11 @ 6:55 pm
In concept, I’m opposed to reducing future pension benefits for current state employees.
But there’s a problem in doing that, and it does not appear to be solvable. We just don’t have any way to fully fund the future obligations.
We’re still using unrealistic numbers on our investment returns, and to make it all happen, we’ve got to catch so many breaks along the way that it’s just unlikely to occur.
Comment by Judgment Day Thursday, Feb 17, 11 @ 7:09 pm
I sure hope Eden Martin’s old firm will handle the case pro-bono if it gets to that point.
Comment by Michelle Flaherty Thursday, Feb 17, 11 @ 7:26 pm
Many State employees comitted to a career in public service with the understanding that the pension benefits would help to offset often mediocre salaries when compared to the private sector. I, for one, turned down private sector jobs paying more, solely for the pension benefit. At this point in my life I no longer have the luxury of making a different career choice. It seems rather dishonest for an employer to change these terms on employees when have been robbed of the practical oportunity to do somthing about it. The situation is especially dishonest when you consider that the pension system is burden not because it is lucrative (many States offer better terms), but because out law makers have repeatedly refused to contribute their portion of it. Instead using retirement funds as a no interest loan to themselves. Couple this with the irresponsible practice of “early retirement incentives” offered in the past and you have a recipe for disaster.
Comment by Einstein Thursday, Feb 17, 11 @ 7:36 pm
Rich, Schnorf, Wordslinger - ie., someone in the know -
Question - If this law was passed and immediately challenged in court, isnt it LISA MADIGAN and the AG’s office who would have to argue the state’s position that the law was legal under the constitution?
I mean, it wouldnt be the Civic Federation in court (sure, they would file an amicus… but) it would be Lisa Madigan arguing, in the run up to 2014 no doubt, that current employees pensions should be reduced.
Or am I missing something?
Would the AG really have their heart in making the argument that their very own benefits should be reduced? Ha!
I dont see how this “clears issues and cleans up issues” for a Lisa Madigan run - it brings her smack dab into the middle of it…
…. but asking those on this board who know better… is that scenario incorrect?!
Comment by Peter Snarker Thursday, Feb 17, 11 @ 7:36 pm
To everyone who says there isn’t a way to fund the pensions, there is …it is called taxes and it is within the power of the State of Illinois (or any sovereign entity) to raise / impose any tax in any amount, even at confiscatory levels. Now if you want to talk about what is politically achievable or fiscally sound, that is a different discussion.
And for those people talking about converting defined benefit systems completely to a 401K type, if memory serves me, when corporations do that outside of bankruptcy, they usually have to FULLY FUND existing mutually agreed upon liabilities in the same fiscal year the conversion takes place with real, cold hard cash. Even in a lot of structured bankruptcies, liabilities of 50% or greater have to be funded, either immediately or within just a few years, typically 5 or less … the Feds insist on that so they don’t get stuck with the pension bill. Today the State can’t make a structured repayment of something like 1/40 or 1/45th plus current year, so how is the State going to pay the whole thing all at once, even if they were to agree to something less than the estimated liability? Again, not politically or even fiscally feasible to make such a payment and not going to happen.
The pension funding problem won’t ever get solved until the discussion changes from “we can’t / won’t do it” to “we’re stuck with it as a matter of law so how can we do it in x number of years” …
Comment by Retired Non-Union Guy Thursday, Feb 17, 11 @ 8:23 pm
Oppose. I’m about as conservative as they get, but this issue only exists due to the total bipartisan neglect of the legislature’s responsibilities over the past twenty five years. If they would have done their part, like state workers have that are mandated, then this would be a non-issue period. We might be talking about deficits, but we wouldn’t be talking about the critical disparity in pensions as part of the problem. Secondly, I believe Abner Mitkva even agrees that constitutionally this is a non-starter.
Comment by Captain Illini Thursday, Feb 17, 11 @ 8:34 pm
Three choices 1) 2) and 3)
1) Employee keeps current benefit but pay 250% of current pension contribution. If you contribute 4% now, it becomes a 10% contribution.
If you contribute 10% now, it becomes a 25% contribution.
2) Join the new plan (tier II) and pay your current contribution.
3) Opt out and join 401K with a match up to
$ 4,000 a year with a COLA.
A) Politicians and Judges must make same choices.
B) Cap salary allowed to base pension at $100,000.
The advantages to this is that the $$$ benefits to the pension system would accrue within 5 years(speed of light for pensions). People would retire quicker but not a mad dash for the door(employee turn over). Each employee could pick his own poison. All employees would be equally unhappy.
gg
“Pay me now or pay me later.”
The devil is always in the details.
Comment by gg Thursday, Feb 17, 11 @ 8:49 pm
Peter Snarker,
I hadn’t considered the AG’s role in any legal challenge or appeal. But you’re right, that’s a very interesting angle going forward.
Comment by 47th Ward Thursday, Feb 17, 11 @ 8:50 pm
Before making changes in the magnitude of the pension, I would make all pensions taxable income, and would require pensioners to pay a portion of health care premiums. I would make the rate of health care contribution progressive; i.e., more for people with bigger pensions.
Comment by jake Thursday, Feb 17, 11 @ 10:17 pm
The state needs to stop spending on pork and pay the pension debt.
Comment by Mike Thursday, Feb 17, 11 @ 11:04 pm
support — I had to scroll all the way down before finding one poster who speaks of taxing pensions. I agree, tax all defined benefit pensions in the state over, say, 50,000. That leaves out the average state worker (22,000) and the average teacher (43,000); tax it at the source. Put every dime of this new tax into the pension system because changing things going forward, even for current employees, won’t be enough. Stop all early outs (rule of 85). Increase current early retirees health care contributions.
Comment by justsickofit Friday, Feb 18, 11 @ 1:27 am
Oppose. I’ve been a public employee for 30 years. While I didn’t expect taxpayers to worship a my feet due to my selfless public service, I didn’t expect them to cut me off at the knees either.
I think my position is quite pro-business actually. Each year I was given a contract that provided a current salary and benefits, and accrued benefits to be paid in the future upon retirement. I have never been in a union, and have gone through several years of either no raise, or a mediocre raise far below the rate of inflation. Each year I accepted that contract, and I endured the years of no raises, furloughs, and meager raises, because of the benefits I was annually accruing for the pension. During those 30 years of government employment, I relied on the promises contractually made to me, and made financial decisions for my family (a wife and three children). My thought all along was not to be a burden on them as I got older. The pension would allow me to do that. That was my goal. Now I’m nearing the finish line, and I see Madigan and R. Eden Martin feverishly digging up the finish line, and moving it further away. That is just injust, and, I believe, will be found unconstitutional.
When people out there tell me, well they screwed me at my business and took away my pension just like that, so why not you? I ask, “Is that really where you wan’t to hang your hat?” Misery loves company, I guess. My decision to work for the state, in large part, had to do with the longevity of the state as compared to that of private employer. Lifetime guarentees mean for the life of the company, not your life. I saw what happened in the auto industry, and I thought that the promises made through our elected representatives, especially those written into the constitution, could be relied upon. Looks like we’ll have to determine that legally now.
When you hire a contractor to remodel your kitchen, the usual arrangement is a certain amount upfront, and the rest upon completion of the job. If I subsequently told the contractor that I thought his completion payment was bloated, and I had been using the cash I had initially been saving for other home improvements, so I didn’t have the money that we had agreed upon, he’d haul my @zz into court so quick my head would spin. He’d win too. I’d have to pay him. I, of course, would never do that. I pay my bills as I’m sure you do, or am I mistaken about that?
Comment by PublicServant Friday, Feb 18, 11 @ 8:03 am
One other perspective: IMRF is another public pension system, mainly for county, township, village and other local government workers not covered by other systems. However, this system is funded by the employee and the local government employer, not the state. As a result, this pension plan is well funded and has been identified as a top-rate pension plan in the industry. (see imrf.org) Even though this system is not broken, it was still lumped in with the state (un)funded plans and moved to a 2-tier system with reduced benefits for new hires. I’d bet that if they make changes to the state (un)funded plans, they’ll include this one in the mix also. How many “wrongs” will the GA do to ALL public employees to correct their own “wrong” of not making their required annual pension payments?
Comment by Hmm... Friday, Feb 18, 11 @ 8:32 am
=I frankly don’t care what the public thinks because on this issue they are all idiots. The public can go to heck as far as I’m concerned=
Demoralized, your contempt for the people who pay your salary is noted. Since this current effort is being led by the democrats you should consider supporting the other side because they are against……oh, wait a minute. That’s the GOP. They would probably be even more draconian in their cuts. Oh, well, maybe you could join the Green party. They have a great chance in the next election. Bwaaaahahahahahahahahaha!
Comment by dupage dan Friday, Feb 18, 11 @ 9:31 am
While there is some merit to the discussion, this reminds me of Wag the Dog.
In this instance many focus on this issue - where the public focuses on state employees as the villain - so they ignore what’s behind the curtain…
Comment by LINK Friday, Feb 18, 11 @ 9:39 am
LINK,
You are absolutely correct. Perception is the key. Folk are so focused on state employees as the bogeyman they can’t see anything else. However, the proposed changes are mild compared to what could happen. Remember, as a state employee myself I will be affected by these changes. I am also aware that it could be much worse. Better to swallow a small, bitter, pill and get the microscope off the state employees so the bashers can switch their focus to something else - behind the curtain…
Comment by dupage dan Friday, Feb 18, 11 @ 9:46 am