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Question of the day

Friday, May 31, 2013

* The Chicago Tribune’s editorial board opines again today about pension reform, demanding that the Senate pass the House’s bill

Nearly seven years after the first warning that state pension funds are hurtling toward insolvency, the Illinois Senate took a few minutes Thursday to raise the likelihood of that doomsday. With their vote to kill this year’s best pension reform bill, the senators deserve to spend the summer trying to explain why they spiked a plan projected to save taxpayers $187 billion-with-a-b — and to eliminate unfunded pension obligations of nearly $100 billion.

Thursday night’s show of failure, orchestrated by Senate President John Cullerton, could be reversed Friday. That would require Cullerton and House Speaker Michael Madigan, his fellow Chicago Democrat, to end a nasty spitting match.

* The SJ-R’s editorial board wants Speaker Madigan to call the Senate’s union-backed bill for a vote and forget about those three separate pension bills, which could be used to test the issue’s constitutionality

The House has approved Madigan’s plan and sent it to the Senate, which has not voted on it. And the Senate has approved the Cullerton-backed plan and sent it to the House, which, you guessed it, has not voted on it. It’s gridlock, but there’s still time for lawmakers to find common ground.

Even after all the back and forth, Cullerton’s SB 2404 still appears to be the stronger legislation. The projected savings are significant. The plan has the backing of state workers and retirees who are being asked to share in the pain of pension reform. It is constitutionally sound, and it doesn’t potentially thrust added Social Security costs onto schools and other retirement systems already at a breaking point.

Forget about approving all or part of Madigan’s plan so it can be tested in a potentially lengthy court challenge. Pass the Cullerton plan now for the best, fairest and most logical shot at pension reform today.

* The Question: What should they do?…

1 - Should the Senate try again to pass the House pension reform bill?

2 - Should the Senate pass one or more of the three pension bills that the House passed earlier to test their constitutionality?

3 - Should the House call the Senate’s pension bill for a vote?

4 - Should both chambers find another way to reform pensions?

Take the poll and then explain your answer in comments, please.

survey service

- Posted by Rich Miller        

  1. - RNUG - Friday, May 31, 13 @ 12:31 pm:

    They need to address the fundamental revenue problem that created all he rets of the mess.

  2. - nieva - Friday, May 31, 13 @ 12:32 pm:

    They are spending 2 billion more this year than last and I am ask to take cuts in my pension. Get your spending under control and then I might be willing to take a cut.

  3. - Democracy - Friday, May 31, 13 @ 12:33 pm:

    I don’t know why the media has let the Speaker off the hook for bottling up Democracy and preventing the people’s elected representatives from voting on SB2404. Like it or not, let it be called for a vote!
    Senators have voted on BOTH bills. They are on the record. House members should demand the same opportunity.

  4. - Anonymiss - Friday, May 31, 13 @ 12:33 pm:

    Cullerton called Madigan’s bill and it failed. Madigan should be a leader and call Cullerton’s bill now. Enough with sour grapes and ego. Act like an adult, and stop choosing nothing over a minimum $50billion solution. Heck, take credit for it somehow if you want it. Just call the bill.

  5. - 47th Ward - Friday, May 31, 13 @ 12:34 pm:

    #3. It isn’t perfect but it might be legal and something is better than nothing.

  6. - FinalHour - Friday, May 31, 13 @ 12:35 pm:

    If the Speaker wants to talk about Leadership, he should practice what he preaches and call 2404 for a vote. At this point in time President Cullerton is the ONLY one demonstrating any leadership qualities. The Governor is the next thing to absent. The Speaker is only thinking of his own agenda at this point and he can’t stand that his bill went down in flames.

  7. - G'Kar - Friday, May 31, 13 @ 12:41 pm:

    I wavered between 3 and 4. I think there are better ways to reform pensions than 2404. But, personally I want a vote and some sort of finality to all of this so I can plan my future, so I voted for 3. (Of course I know 2404 will be taken to court if it becomes law and I know that if the legislature gets away with changing pensions now, there will be no stopping them in the future.)

  8. - Mason born - Friday, May 31, 13 @ 12:42 pm:

    I’m with 47th for the same reason.

  9. - Been There - Friday, May 31, 13 @ 12:42 pm:

    The House should pass the Senate pension bill now. Then the speaker can still keep hammering away with provisions from his bill in later sessions.

  10. - OldSmoky2 - Friday, May 31, 13 @ 12:43 pm:

    The speaker got his Senate vote and his bill failed. It’s time to let the House vote on the Senate bill.

  11. - Calhoun Native - Friday, May 31, 13 @ 12:43 pm:

    I voted for the House to pass the Senate’s bill (SB2404). I’m a State retiree and I don’t want any diminishment of my pension, but I get it. Something needs to be done. I’m willing to live with Cullerton’s bill.

    Madigan’s bill (SB1) is so severe I worry a lot about how I’d make it 10 years from now. I just bought two bags of groceries yesterday and forked over $100. Who knows what I could afford in 10 years in Madigan’s world.

  12. - Archiesmom - Friday, May 31, 13 @ 12:43 pm:

    I’m still reeling that someone in Springfield will take Madigan on and not back down. The Senate bill should pass Constitutional scrutiny. Why waste State time and resources on a bill that likely will not? The House should have to go on record and vote on the Senate bill.

  13. - Frank P - Friday, May 31, 13 @ 12:44 pm:

    #3. The Senate passed their bill and voted the House’s down. That’s called democracy, which the last I checked is what the public wants. The House passed their bill and refuses to have a democratic vote on the Senate bill. The same guy party to 30+ years of underfunding the pension to create an ‘emergency’ in the first place refuses to let the chamber vote on a plan to fix it. Vote SB2404.

  14. - Decaf Coffee Party - Friday, May 31, 13 @ 12:46 pm:

    I think $50 billion or $60 billion in the hand is worth more than gambling on the ILSC giving “police powers” to the state because of a fiscal crisis while the state is off building basketball arenas and spending $300,000 per person in the Grow Your Own Teacher program.

  15. - reformer - Friday, May 31, 13 @ 12:47 pm:

    There’s one reason Madigan won’t allow the Cullerton bill to be called for a vote — he knows it would pass.

    Politics used to be about reciprocation. Cullerton allowed the Madigan bill to be called, but Madigan won’t reciprocate. Instead, he and his new friends at the Trib prefer to bash JC.

  16. - Bill White - Friday, May 31, 13 @ 12:48 pm:

    #3 The House should call SB2404 for a vote


    If this were Hollywood, it would be fun to see AG Lisa Madigan issue a legal opinion that SB1 is unconstitutional, followed by a dramatic personal show down with her father, followed by Lisa being elected Governor via an enormous landslide, in part because she proved she could be her own woman.

    A supporting Oscar would go to the next AG of Illinois, Kwame Raoul, for standing tall and saying that Article XIII, Section 5 was included in the Constitution of 1970 for the precise purpose of preventing legislation such as SB1 from being enacted.

    And the IL GOP would spend another 4 years in dismal exile from the halls of real power.

  17. - Dirty Red - Friday, May 31, 13 @ 12:48 pm:

    = Nearly seven years after the first warning that state pension funds are hurtling toward insolvency =

    Only seven years? How much denial is this board in?

  18. - biased observer - Friday, May 31, 13 @ 12:49 pm:

    sb2404 wont significantly address the fiscal problem. it might be a diminishment in the pension benefits that some on this site can live with, but the problem is that it wont fundamentally change the financial predicament of the state of Illinois.

    so you can hope for its passage thinking all this pension pressure will go away forever, but it wont, because it isn’t nearly enough to solve the problem.

  19. - Small Town Taxpayer - Friday, May 31, 13 @ 12:53 pm:

    As I see it option #1 has no chance based on the wide margin that it was rejected yesterday. Option #2 will just put off the matter for a year or maybe 18 months while the courts review the matter. Option #3 fails to solve the problem as it will not generate $100B in savings. Option #4 also just puts off finding a solution to the pension issue but is worse than #2 because there is no end date in sight for arriving at a solution.

    Overall, for this session of the GA option #3 is the ‘least bad’ of the four options listed. This is said even as it is known in advance to be only a half way measure and not a true solution the pension issue. With option #3 selected taxes still need to be increase and/or spending also needs to be reduced to fund the pension plans.

  20. - Earnest - Friday, May 31, 13 @ 12:54 pm:

    I voted #4. I’d prefer the Senate pass the House bill, but that’s not going to happen. We don’t do proactive well in Illinois, so maybe things have to wait until the “temporary” tax increase is about to expire and we all feel like disaster is pending more closely than it appears to be given the budget that is going through for FY14.

  21. - biased observer - Friday, May 31, 13 @ 12:59 pm:

    although retirees, union folks, teachers etc exert a great deal of pressure politically and have been successful at attaining and maintaining very nice benefits for themselves, I don’t know if it will be politically possible for this GA to raise revenue enough and cut spending enough while completely sparing the public pension programs.

    this scenario might create enough political traction to overwhelm the vocal pension minority.

    its a tough conundrum for the GA which would take intelligent,thoughtful, selfless leadership to solve while putting one’s seat in peril and I have very little confidence this will occur.

    I agree with RNUG we will just keep going till this thing completely deteriorates and who knows how things will shake out then.

  22. - Bill White - Friday, May 31, 13 @ 12:59 pm:

    We don’t need $100B in savings just as I don’t need 30 years of mortgage payments in the bank to afford my house. I pay for my house with future earnings.

    Pass SB2404 now and track the numbers going forward.

    Also, step back and acknowledge that aggregate state/local taxation in Illinois is below average among urban states, even with the income tax rate at 5%

  23. - east central - Friday, May 31, 13 @ 1:01 pm:

    If SB2404 is not passed now, next year may be even tougher if there is substantial new revenue from economic recovery, fracking, and gambling expansion and if stock market returns boost the pension investments. Going into an election period without passing a pension bill is a gift to the other party.

  24. - Bobbysox - Friday, May 31, 13 @ 1:02 pm:

    3. It is a compromise that the majority of legislators support and that was negotiated with the Unions that represent the bulk of public employees. There should be no need to compromise on a compromise.

  25. - biased observer - Friday, May 31, 13 @ 1:03 pm:

    east central- not going to be substantial new revenue from fracking next year. it will take several years at the earliest, if at all.

  26. - east central - Friday, May 31, 13 @ 1:09 pm:

    biased observer,
    My assumption is the scramble to acquire sites and make initial capital expenditures for fracking would involve substantial spending, yielding revenue. But you may be correct that there will be a lag.

  27. - Joe M. - Friday, May 31, 13 @ 1:17 pm:

    A while back someone suggested the best strategy for the state employees and teachers would be to negotiate the best bill they can - and then watch it get defeated in the courts.

    Then the next step would have to be solutions of some combination(s) of increasing revenue, fixing the payment schedule, closing business loopholes, cutting spending, etc. Once those are done, then the state employees and teachers might be more enthusiastic about cuts in their pensions and/or increased payments.

  28. - Anon. - Friday, May 31, 13 @ 1:18 pm:

    I voted #4, but the first thing they must do is acknowledge that the State must pay its existing obligations. They can change pension benefits earned for future services and contribution rates to be made for future accruals all they want, and people can decide whether or not to (continue to) work for the State on that revised basis, but they have to pay what they owe.

    And “something is not better than nothing” if that something is unconstitutional, because passing an unconstitutional bill will just mean the problem will be bigger when it’s thrown out.

  29. - steve schnorf - Friday, May 31, 13 @ 1:23 pm:

    bo, you keep saying the same thing time and again. The Cullerton plan, so long as cost shift is adopted and payments to PoBs and notes directed to the pension systems as they are retired, works fine, as do many other proposals that have been offered, going back to Rep Fortner’s and including the Speaker’s. Unless you have some yet unrevealed definition of “works”, you are simply wrong.

  30. - Nickypiii - Friday, May 31, 13 @ 1:25 pm:

    TIT FOR TAT! C’mom Mike….call the bill for a vote. It’s only fair that Cullerton’s bill gets a chance now too!

  31. - Mouthy - Friday, May 31, 13 @ 1:25 pm:

    Voted for number 4. Speaker ain’t gonna call SB2404 despite all the whining on this board. The other 3 lone wolfs are goners too. It’s time to go back to the drawing board and “Pay the Pensioner”.

  32. - Mouthy - Friday, May 31, 13 @ 1:33 pm:

    Quinn, the leader, wants to the Senate to reconsider SB1 but doesn’t say he’ll veto SB2404 if it passes the House. His leadership is to sign anything, please, anything, the real leaders of the state might send him.

  33. - Wensicia - Friday, May 31, 13 @ 1:33 pm:

    #3. It’s a step forward and may hold up under the constitution.

  34. - Rudy - Friday, May 31, 13 @ 1:34 pm:

    The Speaker is on the verge of owning this entire underfunding issue. By allowing his colleagues to pass the Senate’s compromise bill today, he can be part of the solution.

    I know the Speaker is not prepared to write daily checks to the State of Illinois for the interest that the present underfunding will continue to accrue in the weeks and months to come, until some form of remedial legislation is passed.

    But the Speaker is a lawyer and understands causation: if he fails to call the Senate bill today, that omission will be the proximate cause of much of that additional debt, assuming the House would pass the Senate bill–an assumption that can be tested by polling. As others have repeatedly noted, the Speaker has already contributed significantly, through his decades of leadership in the House, to the current level of underfunding. Although he tried to take a giant step in the opposite direction, it didn’t pass the Senate. So today, Illinois needs more than yesterday’s good intentions. The Speaker is in the position to aggravate or mitigate Illinois’ plight. He should call the Senate bill today.

  35. - Former Merit Comp Slave - Friday, May 31, 13 @ 1:39 pm:

    In the words of Rep Norrine Hammond, the higher ed budget bill was full of pork. As long as this continues and no effort is being made to reign in spending (note Speaker Madigan, no apparent fiscal emergency), then I vote for #4 and the whole bunch of them should listen to Ralph and start again.

  36. - dupage dan - Friday, May 31, 13 @ 1:42 pm:

    Hard to see MJM kowtowing to Cullerton here but that is what should happen. Cullerton called the house bill, MJM should call the senate bill.

  37. - Sir Reel - Friday, May 31, 13 @ 1:46 pm:

    #3. Time’s awasting.

  38. - titan - Friday, May 31, 13 @ 1:47 pm:

    = Nearly seven years after the first warning that state pension funds are hurtling toward insolvency =

    Um…that probably ought to read “70 years”

    === … Cullerton’s SB 2404 still appears to be the stronger legislation. … It is constitutionally sound ===

    Well, not really all that sound (it only looks that way in comparison).

    I vote for passing SB2404 (and we’ll see if even it survives challenge).

  39. - Formerly Known As... - Friday, May 31, 13 @ 2:14 pm:

    Option #3 pulling in 68% of the vote in a 4-question survey?

    Seems pretty clear.

    Call the bill, Mr. Speaker.

  40. - Grandson of Man - Friday, May 31, 13 @ 2:25 pm:

    I voted for #3 because the unions contributed to it and because it might withstand a constitutional challenge. Two tough looking guys came to my house, and one by the name of “Vito” said the union bosses wouldn’t like it if I filed a legal challenge to SB 2404.

  41. - archimedes - Friday, May 31, 13 @ 2:44 pm:

    Sb2404 probably cuts the penion cost as deep as you can go, flirting (if not crossing) the line on legal. From here on, it’s a matter of how you come up with the rest of the $$. Cut other expenses, new revenues, or preserve some of the temporary income tax increase.

    SB1, if passed, would not have cut enough expense from the budget to negate any further cuts or needing more revenue, or keeping the income tax increase in place.

    The Trib and everyone throwing around the huge $150 to $187 billion “savings” seem to forget that is spread out over 30 years and is largest at the end of the 30 years.

    SB1 would not have solved the State’s financial problem. SB2404 does not, either. Both need additional revenue or additional cuts for the State to make ends meet.

    Pass SB2404, so you can get started on the rest of the work you have to do.

  42. - Mouthy - Friday, May 31, 13 @ 2:51 pm:

    Call the bill, pass the bill, it’s only fair, etc. I’m a retiree and I’m loving the fact that nothings passed both houses. Pay me what you owe me and I really don’t care how you do it.

  43. - Rod - Friday, May 31, 13 @ 3:00 pm:

    Option 3 is the only way to go at this point if something is to pass at all. As titan pointed out even the Senate bill may not survive legal challenges from the retired teachers and others.

  44. - Cook County Commoner - Friday, May 31, 13 @ 3:05 pm:

    Saw the post from Rich Miller on the live blog that Moody’s has weighed in and warned of a bond down-grade if pension reform is not passed.
    Should be no surprise, but I wonder if this will galvanize some meaningful reform shortly before midnight. Any real pension reform will offend the state constitution. Hopefully, something will come out of the GA and start the ball rolling towards a IL Supreme’s opinion that hopefully will provide some guideposts for future changes. Pension reform looks like it will be a long term process, nudged along as the state fiscal situation deteriorates.

  45. - davidh - Friday, May 31, 13 @ 3:14 pm:

    #3 — procedurally because it would reciprocate the Senate’s consideration of the House bill; substantively because this the clearest (and fairest IMHO)path to doing something about the problem. Let’s get this done.

  46. - Jake - Friday, May 31, 13 @ 3:18 pm:

    #1 The senate bill doesn’t go nearly far enough. Everybody will probably have to return and pass another round of painful pension reform legislation in a few years time unless something that has the long-term savings of the house bill gets through…

  47. - mid-level - Friday, May 31, 13 @ 3:33 pm:

    I believe the situation has been predetermined. The two big tops are just picking off the options one by one so that everyone, including the general public and AFSCME, feel like they have played a role in the end result.

  48. - Angry Chicagoan - Friday, May 31, 13 @ 3:39 pm:

    Call the bill. Period. The House this term is really showing up its defiiciencies. You can’t run a democracy if the only way a bill can pass is if BOTH the Speaker likes it AND it is known in advance that a majority will vote for it. Let’s at least get people on record.

  49. - Pacman - Friday, May 31, 13 @ 3:43 pm:

    Both bills are unconstitutional. I voted for #4. Time to bring in legal and actuarial scholars to craft a bill thats legal and will work. There is no quick fix! Accepting 2404 is a slippery slope. Once you accept any diminishment you open a can of constitutional worms. I believe it’s called legal precedent.

  50. - Pacman - Friday, May 31, 13 @ 3:45 pm:

    Should have added that I believe 2404 is backdoor way to skirt the constitution. Makes believe the good cop, bad cop scenario.

  51. - SO IL M - Friday, May 31, 13 @ 3:56 pm:

    #4. Ammend the Senates Bill to leave current Retirees intact, all changes affect those retiring 06/01/2013 and after. This would have the best chance of standing up in Court. Passing anything that will get struck down later is wasting more time and money.

  52. - anon - Friday, May 31, 13 @ 4:06 pm:

    #4 but only because there is no just give it up option. Stop “reform” which is nothing but theft. Start funding the pensions and make the necessary cuts/tax increases to do so. Why should the employees be robbed so the bond ratings can enable pork to build new stadiums for private schools and taking even more pension holidays with CPS?

  53. - Norseman - Friday, May 31, 13 @ 5:01 pm:

    The one problem with passing SB 2404 is that it’s impossible to do it today. It hasn’t even been read a second time. They’ll have to attach it to something else if it’s to get done today. I haven’t seen any rumors to that effect in the live session. The Senate could add 2404 to one of the piecemeal bills and send it over for a House accept or reject action, but I suspect the environment has become so toxic this will be addressed in a special session after a week or two to cool off.

  54. - Mama - Friday, May 31, 13 @ 5:31 pm:

    Does everyone here believe Madigan cares about doing the right thing by calling 2404? Does MJM even care about our pension funds going belly-up?

  55. - RNUG - Saturday, Jun 1, 13 @ 12:45 am:

    SO IL M @ 3:56 pm:

    If they amend any bill to leave already retired alone, then a large part of the savings goes away … and the GA will have to finally admit they have a basic revenue problem.

  56. - JustMe_JMO - Saturday, Jun 1, 13 @ 10:09 am:

    They need to find a solution without having to test the constitutionality of a bill.

    Plan “A” reduce benefits for retirees / current employees — did NOT work.. on the Plan “B”

Sorry, comments for this post are now closed.

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