44 Comments - Fair Share - Wednesday, Jan 11, 12 @ 12:45 pm: They should pass many reforms and include standard “savings clause” to preserve all sections not found to be unconstitutional. E.g. cut current pensions; cut colas; cut pensions of those not vested; cut future pensions; increase contribution requirements for each group above. - 47th Ward - Wednesday, Jan 11, 12 @ 12:47 pm: This was suggested here and maybe elsewhere previously, but the General Assembly should pass a reform plan that only applies to the General Assembly plan. Then we can get a former member who is a plan beneficiary to sue and the courts will have the chance to weigh-in and rule. That ruling should provide the necessary guidance to craft wider reforms to other plans, or it may tell us that changing the constitution is a prerequisite. Either way, it will force the issue and let the General Assembly do something more than debate this to death. Either it’s constitutional or it’s not, and the quicker we resolve the question the better. - Old Guy - Wednesday, Jan 11, 12 @ 12:54 pm: I voted to pass something else. Unfortunately, I am afraid that an unconstitutional reform will pass, the Governor and legislature will immediately spend the “savings” and then the courts will throw it out – pushing Illinois even deeper into debt. - Oswego Willy - Wednesday, Jan 11, 12 @ 12:55 pm: Any time you pass a law you know IS or MAY be unconstiutional, you risk the possibly of judges legislating from the bench and taking the legislative aspect of the branches of government out of where it should be and giving the third branch ultimate say in what should be a legislative answer. I am afraid if the Illinois courts become the “General Assembly” because the GA just wants to pass “stuff and see if it flies”, Illinois will be far worse off than if the GA actually does the work the people of Illinois voted for them to do … be a General Assembly! Find another legislative way. - Cincinnatus - Wednesday, Jan 11, 12 @ 12:56 pm: The GA is one Constitutional branch of government, and supposedly the preeminent one in the triumvirate. They should pass the law, and let the Court resolve the issue, if for no other reason other than to put the debate to rest once and for all. After the case, and if the GA were to lose, we would then have two clear paths to follow, either work within the ruling, or pass a Constitutional amendment. Any way it plays, we would then have some certainty where now we have none. - anonymice - Wednesday, Jan 11, 12 @ 1:00 pm: Pass something else. Brinkmanship with the constitution and taking it to the courts is a losing game. If they can do it to anyone in a state retirement plan, they can do it to the judges, too. (The special prohibition against reducing judges’ salaries only says they can’t be reduced during the judge’s term of office, and so doesn’t apply to reductions in retirement, which is not salary and which isn’t received until after the end of your term.) The courts that held onto their COLAs will also hold onto their pensions, and by then the state will be further in the hole. - Retired Non-Union Guy - Wednesday, Jan 11, 12 @ 1:03 pm: The legislature has already changed the benefits in terms of what it takes to earn them, to collect them, and the COLA calculation. As several commentators have previously pointed out, the rating services want a plan to *fund* the pensions, not reduce or eliminate the pensions. The legislature needs to come up with a funding plan. Possibilities include expanded or new taxes dedicated to just pensions, the elimination of loopholes (deductions), the elimination of some State agencies, or dumping what can be dumped on local taxing bodies … all hard choices. The funding plan may include dumping TRS funding back on the individual school districts and SURS to being funded by university tuition in order to make the various boards realize the cost of their salary decisions (which is probably a good idea). However, as I see it, both those actions are somewhat self defeating in the long run because, if the schools can’t raise taxes and fees high enough to cover the pension costs, the schools will either cut programs or come looking to the state for money to maintain the programs that would be cut. In the short run, by dumping those two programs back to the ‘local’ level, the State should have enough to fund the actual ‘State employee’ pensions: SERS, JRS and GARS pensions. And the combination of the two actions ought to satisfy the bond rating agencies. There’s nothing, short of total pension elimination, that will satisfy the Civic Committee … because there real agenda is to avoid being taxed to fund these costs. Rich has made the best proposal I’ve seen on the table; to lower the 90% target to 80% which would help smooth out the 1995 reform ‘ramp-up’ curve. If the date to meet that funding level (2045 I think) was moved out to 2060, that would further smooth the curve. After all, it took about 50 to 70 years to get here, it doesn’t have to be ‘fully funded’ overnight. - Anon - Wednesday, Jan 11, 12 @ 1:03 pm: I voted for another way…such as perhaps changing the payment ramp, perhaps changing the system for future members, etc. In addition to the constitutionality issue, the State is morally responsible for fully funding the pension obligations it has agreed to, but has not paid. If a private company had raided the pension fund of its employees this way, the moral outrage would be more obvious, whether the actions were legal or not. Just because we’re broke doesn’t make every possible solution right. - Foxfire - Wednesday, Jan 11, 12 @ 1:07 pm: The GA and Governor must do something that complies with the IL Constitution. To do otherwise, would be foolish. They have the ability to get a deal done, if they truly wanted to. They also have the ability to expand the conversation beyond the 4 corners of the pension system. Employee compensation and benefits is a very broad area and changes could be made in many of them to achieve the required “reform.” To this point, labor’s mantra has been, “we’ve paid our share, so we shouldn’t be required to make any changes.” That seems very childish to me. It also seems like the GA is acting like the parent of a spoiled child by refusing to take action for fear of the resulting temper tantrum. If they can’t get something done, there’s always the possibility of a constitutional amendment to allow the voters to make the decision for them. Well, maybe not. - Ahoy - Wednesday, Jan 11, 12 @ 1:10 pm: I voted to let the courts decide, but only because what is and is not constitutional is up to interpretation. I believe they should pass something they believe can pass a court challenge, but there is no way to pass any kind of reform measure that everyone is going to agree is constitutional. I also highly discourage leaving the judges retirement system out as a bribe. - For the Record - Wednesday, Jan 11, 12 @ 1:13 pm: This is probably the best question you’ve asked in a while. - Cassiopeia - Wednesday, Jan 11, 12 @ 1:14 pm: The only fair thing to do is to make every effected entity from local school districts to all current, retired and future employees to sacrifice something to a solution. This should include a real plan for future funding. Everybody needs to lose a little. - soupperk - Wednesday, Jan 11, 12 @ 1:23 pm: Pass something else — which would address the under-funding yet be constitutional. Perhaps working with the constituencies, rather than against them, might be a good start. Solvent, sustainable public pensions are good public policy and good for effective government. - reformer - Wednesday, Jan 11, 12 @ 1:24 pm: I’m afraid the legislature has ample precedents of voting for bills of dubious constitutionality, even when they knew the bill might well be struck down. I recall Rep. Lang once predicting a bill would be unconstitutional, but voting for it anyway. One such bill was Blago’s restriction on the sale of mature-rated video games. It passed easily and was knocked down promptly. Another example is the Drew Peterson law, which allows hearsay evidence in a criminal trial. So far, the circuit and appellate courts have ruled against the law. - Rich Miller - Wednesday, Jan 11, 12 @ 1:27 pm: reformer, neither of those bills would’ve impacted the incomes of thousands of people and impacted the budget by billions of dollars. This is not some gimme bill. It will make a huge difference either way. - CircularFiringSquad - Wednesday, Jan 11, 12 @ 1:35 pm: We voted something else although we wanted to vote let the courts decide, but then concluded after the courts adhered to teh Constitution then the Bankrupt Tribbies and other whiners would only whine more Saves us some time How about an option that says union follow lead of Rhode Island? - wordslinger - Wednesday, Jan 11, 12 @ 1:40 pm: I said pass something else. I’m not in favor of throwing spaghetti against the wall to see if it sticks. Not all pensions are created equal, and I don’t think the benefit structure is terribly out of whack for most state employees. Reducing the ramp and dedicating a portion of existing revenues would be a start. That would necessitate cuts elsewhere, but that’s life in the big leagues. - Reality Check - Wednesday, Jan 11, 12 @ 1:52 pm: I voted “pass something else”. The problem with the pension systems is the failure of politicians to pay an adequate share. Illinois must pass a law that (1) requires annual employer contributions to be based on actuarial principles, not whatever is politically convenient, and (2) teeth in the law to ensure that such contributions cannot be skipped. Fortunately, there is a model for this. Statue has long required both provisions of employers that participate in the municipal retirement fund (IMRF), and that system is at a healthy funding level today. - Alexander Cut The Knot - Wednesday, Jan 11, 12 @ 1:56 pm: Pass something that lets the people vote to amend that portion of the Constitution. - Stones - Wednesday, Jan 11, 12 @ 1:57 pm: Legislators are elected (in theory) to represent their constituents. Sometimes that involves very tough choices. The GA and the Governor need to “man up” and pass something that amounts to not kicking the can down the road. Passing something that is simply going to be overturned by the Courts is just not going to cut it. - The Elderly Man You Used to Love - Wednesday, Jan 11, 12 @ 2:01 pm: My ’something else’ is a constitutional amendment. If you want to reduce benefits for current workers, put the question squarely before the voters and let them decide. It really baffles me why this option isn’t getting any traction. The standard refrain is that a constituitonal amendment is “too controversial,” but SB 512 has already put the unions and the Civic Commitee on defcon 4. Plus, it’s an opportunity to give legislators an opportunity to do what they love most - kick the can down the road. They can simply tell their constituents “this is far too important an issue to proceed on without a mandate from the people.” And then if that mandate is granted, the handcuffs are off and the Legislature can pass 512 or whatever other reform measure it deems appropriate without worrying about violating the constitution. - Colossus - Wednesday, Jan 11, 12 @ 2:14 pm: I voted no change, and I’m not seeing much chatter here from this side of it. As far as I’m concerned, anyone who is vested (active or retired) is a done deal - ain’t no going down or cutting back on those. A deal’s a deal. While I’m open to some tweaking for unvested and newhires, I’d rather avoid it if at all possible. This has been argued ad naseum here, and there is simply no justification for Illinois to break its deals with employees because elected officials didn’t put the money where it should go. The people being asked to take the hit (and blamed for it by the likes of the Civic Committee) are the responsible actors in this drama - they made their payments. There shouldn’t be a decrease in what is paid out just because the funds were mismanaged by elected officials - that’s like your bank spontaneously (and retroactively) changing the interest rate on your bank account because they’re short on cash. It’s just not the way finances work. And given that the state is the largest employer here, the ramifications of breaking these deals is enormous, not to mention the geographic distribution of state employees and the multiple reps and senators they end up with. So if you can’t reduce the outflow, more money has to go in to the system to keep it afloat. Maybe stop shovelling money out the door to profitable businesses, that would be a good start. I guess I’m agreeing with Wordsmith here (surprise, surprise), though we voted in different categories. - Grandson of Man - Wednesday, Jan 11, 12 @ 2:32 pm: This is a very difficult problem. I voted for something else. The pension ramp could be adjusted, but I remember a conversation here late last year that may not have been concluded, between Mr. Schnorf and Mr. Miller. I think Mr. Schnorf wrote that even with the ramp adjustment, the debt would escalate. This is a defining moment for Quinn, who made bold statements about getting reform done this spring. I hope that the solution does not require ad campaigns like we saw last fall. - GA Watcher - Wednesday, Jan 11, 12 @ 2:35 pm: I voted pass something else, if anything to add reforms to all pension systems to the mix, not just those included in SB 512. In addition, let’s not forget that some labor organizations have indicated they plan a court challenge to the reforms the Governor signed into law last week. That will likely settle the constitutionality question re prospective benefits. - ChiefM - Wednesday, Jan 11, 12 @ 2:38 pm: Can they tax pensions over a certain level with that revenue going directly back into the pension system? - The Elderly Man You Used to Love - Wednesday, Jan 11, 12 @ 2:41 pm: I wouldn’t look to a court ruling on HB 3813 as a harbinger of how the courts might rule on the broader question of cutting future benefits for current workers. Any ruling on HB 3813 is likely to be very narrowly-tailored to the situation involving the two union lobbyists. - Yellow Dog Democrat - Wednesday, Jan 11, 12 @ 2:44 pm: Attach everything the Republicans hate to a pension bill you know will be overturned, but include a severability clause. Top of the list: sunsetting all corporate tax breaks, starting with the newspaper subsidy. - Rich Miller - Wednesday, Jan 11, 12 @ 2:44 pm: ===Can they tax pensions over a certain level=== Doubtful. Courts have limited significant income exemptions as violative of the flat tax rule. - Anonymous - Wednesday, Jan 11, 12 @ 2:52 pm: Back in the 80s, Senator Leroy Lemke regularly used to say, with respect to anti-abortion bills, that the Senate shouldn’t refuse to pass a “good bill” just because some idiot judge someplace was going to declare it unconstitutional. Senator Dawn Netsch always took him to task for that. It was wrong then; it’s wrong now. - Capital View - Wednesday, Jan 11, 12 @ 3:22 pm: time to grow up, folks. Wee need to address modernizing our state revenue system, for the sake of pensions and operations generally. More sales taxes on services, and amending our state constitution to make state income taxes graduated. All the “99%” rhetoric should make passing that state constitutional amendment easier. On pension reform itself, no more early retirements. Eight years of state service for all pensions to kick in, even judges / legislators / state officers appointed or elected. Let military service and trade-ins from other governmental bodies add to years and pension amount after 8 years, but not towards it. - He Makes Ryan Look Like a Saint - Wednesday, Jan 11, 12 @ 3:40 pm: I say change the law that says it has to be funded at 95% by (whatever the year was). That would reduce the amount that is necessary to pay in and should keep the system solvent. They seem to find no problem passing bills that keep them from funding the pensions when they want to, what is it that they are afraid to change the 95%? - Bill - Wednesday, Jan 11, 12 @ 3:51 pm: Choices two and three sgould both be accomplished. It is not an either-or. Besides cutting benefits SB 512 style, even if it were constitutional, does NOTHING to reduce the 85 billion in debt. Benefits are average at best and cutting them will not solve the problem. The state has to pay up. Extend the sales tax, close corporate loopholes, earmark all new gambling revenue to the debt, etc..Oh and, by the way, look at the rates on those capitol bonds. Sell some POBs and put all the money in this time. - Tommydanger - Wednesday, Jan 11, 12 @ 4:01 pm: Article I, Section 10 of the US Const: No State shall enter into any Treaty, Alliance, or Confederation; grant Letters of Marque and Reprisal; coin Money; emit Bills of Credit; make any Thing but gold and silver Coin a Tender in Payment of Debts; pass any Bill of Attainder, ex post facto Law, or Law impairing the Obligation of Contracts, or grant any Title of Nobility. Don’t know if there are any constitutional scholars out there, but even if the Ill. Const. was somehow amended, how do you get past the US Constitution? - Bill - Wednesday, Jan 11, 12 @ 4:33 pm: ==how do you get past the US Constitution?== You don’t and there are seven precedent setting federal court decisions affirming that. - dupage dan - Wednesday, Jan 11, 12 @ 5:12 pm: The passing of the law and waiting for the courts to decide is the wimpy way of doing it. Since there is evidence that the law will be struck down as unconstitutional, it is a waste of time and, IMO, is basically a ploy for the reps to be able to say to their consituents, “well, we tried”. Do the hard work and come up with something that will pass muster. Make us believe you are something OTHER than the cowards we believe many of you are. DO your JOBS! - JJS - Wednesday, Jan 11, 12 @ 5:12 pm: Leave it alone!! I have been working for my modest pension for almost 25 yrs. - steve schnorf - Wednesday, Jan 11, 12 @ 5:38 pm: They do take an oath, remember - Yellow Dog Democrat - Wednesday, Jan 11, 12 @ 7:54 pm: Passing an Unconstitutional measure is the BEST thing that could possibly happen to the unions. Remember what happened when we passed unconstitutional legislation capping medical malpractice restitution? The voters lost interest, the political heat went away, and when the dust cleared and the courts issued their inevitable opinion…”reformers” gained absolutely nothing. In this case, things end even worse for the Tribunites. In this case, unconstitutional pension reforms will allow lawmakers to spend “savings” that we will never actually realize, and it allows the unions to escape pending layoffs this summer that would otherwise be unavoidable. Every dollar the GA claims we’ll save through illegal pension cuts will just be another dollar deeper in the hole. - Liberty First - Wednesday, Jan 11, 12 @ 9:08 pm: They are looking at options because TRS’s independent study showed forcing higher contributions only results in earlier retirement…. A lot of money has been put into K-12 education over the last 15 years, it is time to pull back. - Yellow Dog Democrat - Wednesday, Jan 11, 12 @ 9:45 pm: Two other points: For those who complain about state government now…I can’t wait to hear your feedback on customer service in the years between pension repeal being introduced and it being repudiated by the courts. Secondly, don’t for one moment delude yourself into believing this debate is about fiscal responsibility. Its not. When AFSCME was endorsing and electing Republican after Republican, The Tribune was silent about pension debt. Their primary goal is to sever the historic alliance between organized labor and the Democratic Party. That’s why they don’t care that retroactive pension cuts are illegal…these guys sign contracts every day, they understand the Contracts Clause. They just want to force Democrats to vote on it. - dr. reason a. goodwin - Wednesday, Jan 11, 12 @ 11:30 pm: As a state university employee, it’s hard for me to see why my pension should be cut because the GA “borrowed” the pension contributions they were supposed to make. If a private employer skips a social security contribution, Uncle Sam threatens to send them to jail. But Madigan et al can skip and skip and skip. The state’s share of the SURS plan is either 7.6% or 9.2% of salary, depending on the retirement options. If the state was paying SS instead, it would be 6.2%. I wonder if we could settle for the back payments at a 6.2% rate. It would be better than nothing. - Sick of It All - Thursday, Jan 12, 12 @ 12:20 am: Hands off the state pensions! Fund them and don’t raid them. We wouldn’t be in this pathetic mess on so many levels if we had legislators that that did the right thing instead of pander to special and their own interests. Let Lawrence Msall, the mouthpiece of the Civic Federation give up his State pension first! Do any of you remember that he was Deputy or Assistant Director of DCCA in the 1980’s? Now he’s attacking State employees. I called him on it several times. Easy prey we are - IL has the smallest percentage of public employees among the states! - ANAL - Thursday, Jan 12, 12 @ 7:58 am: Unless the G.A. puts everything on the table, then there should be no change. Giving tax breaks to corporations and calling for a rollback of the latest income tax increase demonstrates the fiscal irresponsibility that generated the current fiscal crisus. - KurtInSpringfield - Thursday, Jan 12, 12 @ 8:21 am: I voted for no (legislative) change in benefit structure. If the State wants to change benefits, it should follow contract law and negotiate, offer a new consideration in exchange for reduced pension benefits. Besides a constitutional amendment, that is the only other constitutional way to change benefits for current employees. In Kraus v Board of Trustees of the Police Pension Fund of the Village of Niles, the Illinois Supreme Court concluded the Constitutional Clause “prohibits legislative action which directly diminishes the benefits to be received by those who became members of the pension system prior to the enactment of the legislation, though they are not yet eligible to retire.” Kraus, 72 Ill. App. 3d at 849, 390 N.E.2d at 1292-93. So really the constitutional issue has already been settled. There are three or four other cases, but Kraus is directly on point here. Another issue is any changes in benefits still does not resolve the real problem - funding! Even Cross admitted last year that SB512 does not solve the problem of underfunding the pensions. So, if SB512 passes, not only does it not reduce the debt owed, but if the practice of underfunding the pensions continues, sooner or later (probably sooner), we will be in the same situation we are now. One last point, the Pension “crisis” I believe is a manufactured crisis. In 1970 the Pension funds had an aggregate funding ratio of 41.8%. That was over 40 years ago and the funds have not gone bankrupt. As a matter of fact, they have remained relatively stable for the last 40 years. How is it that now all of a sudden the funds are on the verge of bankruptcy and in crisis? The funding ratio is still about the same. Sorry, comments for this post are now closed.