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Question of the day

Friday, Nov 22, 2013

* Subscribers know more, but the four legislative leaders said there was progress on pension reform during a teleconference meeting yesterday. Sun-Times

[Rikeesha Phelon, spokeswoman for Senate President John Cullerton] declined to outline any specifics of the plan being discussed, but said talks on the cost-of-living issue have used a plan proposed last spring by Senate Minority Leader Christine Radogno, R-Lemont, as a general template.

Earlier this year, she proposed giving a retiree annual increases of 3 percent of an amount equal to the number of years they worked for state government, a university or Downstate and suburban school district, multiplied by $1,000.

An aide to House Minority Leader Jim Durkin, R-Western Springs, characterized the talks as productive but stressed a final deal isn’t in place to deliver to rank-and-file members.

“We’re optimistic there will be something done before the end of December. We’ve said that all along. But there’s no plan. There’s nothing solid yet to present to the members or anything at this point,” Durkin spokeswoman Vicki Crawford said. “But the talks have been very productive and are ongoing, and that’s a good thing.”

The legislative leaders are expected to resume talks again next week prior to the Thanksgiving holiday.

* The Question: Have you changed your mind about whether a pension reform bill will be passed in the early December session? Take the poll and then explain your answer in comments, please.


survey software

Also, notice that I did not ask you about whether you wanted it to pass or not. It’s about your thoughts on whether it will or won’t pass.

- Posted by Rich Miller        

43 Comments
  1. - MrJM - Friday, Nov 22, 13 @ 12:03 pm:

    “Unlikely but more likely” because I’m a cynical optimist.

    – MrJM


  2. - 47th Ward - Friday, Nov 22, 13 @ 12:09 pm:

    I think it’s more likely now.

    It sure feels like there is a growing feeling of inevitability that a significant pension reform bill will pass. I didn’t get that same sense a month or two ago.


  3. - Joe - Friday, Nov 22, 13 @ 12:10 pm:

    I voted “no, I;ve previously believed it was likely.”

    Seems like Ragdono’s more restrictive COLA is turning this proposal into SB1 by a different name. Don’t know why Cullerton in his caucus (and the downstate GOP senate members,) would get behind a bill like that after shooting it down spectacularly the first time.

    Of course, the Republicans who don’t want to hand Quinn a victory are well aware that Radogno’s proposal is a poison pill that will kill the Conference Committee’s tentative agreement — which is why they’re pushing it,


  4. - Precinct Captain - Friday, Nov 22, 13 @ 12:11 pm:

    Yes, more likely. If it happens, the roll call(s) will be interesting.


  5. - walkinfool - Friday, Nov 22, 13 @ 12:12 pm:

    A bit like marriage equality: I was certain they’d do it before year end, but that doesn’t mean I’m not fretting about it up to the final day.


  6. - mythoughtis - Friday, Nov 22, 13 @ 12:16 pm:

    The fact that Madigan has more or less scheduled (without actually doing so) a session in December tells me it WILL pass.


  7. - PolPal56 - Friday, Nov 22, 13 @ 12:32 pm:

    Yes, I now think it’s more likely, because they want to have it go to the courts, have it knocked down, and be “forced by ISC” to move on to revenue. The timing is perfect for this - they can crow about how they really stuck it to the State workers all through the primaries while the case is dealt with in court. By the time it’s been ruled egregiously unconstitutional, elections will be over, and they can move on to revenue issues.


  8. - PolPal56 - Friday, Nov 22, 13 @ 12:32 pm:

    State retirees and workers


  9. - Anonymous - Friday, Nov 22, 13 @ 12:34 pm:

    USA Today had article ranking Illinois in top 3 worst run states, citing pension crisis among major problems leading to the ranking. I think it will happen


  10. - just asking - Friday, Nov 22, 13 @ 12:45 pm:

    i am poor at math-is Christine saying COLA of a little under $1,000 per year not compounding for a 30 year employee? If that is correct, how about getting at the Senate Dem constitutional concept through a choice of $5,000 up front with no COLA’s. In this hypothetical the 5,000 could be more or less to the extent the retiree had more or less than 30 years.


  11. - Roadiepig - Friday, Nov 22, 13 @ 12:54 pm:

    Voted more likely than before. I am also leaning towards the idea that the GA knows it is almost sure to be overturned by the supremes but will get them through the next election cycle looking like they really stuck it to those “greedy union slugs”. RNUG has been summing this up for a little while, and (knowing what cowards these politicians are) they are hoping they can blame us retirees and workers for having to raise everyone’s taxes once their house of cards falls down.


  12. - Bill - Friday, Nov 22, 13 @ 12:55 pm:

    Giving a “choice” about how to diminish a benefit doesn’t make this mess constitutional.


  13. - Union Man - Friday, Nov 22, 13 @ 12:55 pm:

    Let’s get something passed and then have courts slam it down.


  14. - DuPage - Friday, Nov 22, 13 @ 1:05 pm:

    Coin flip, it could go either way. Unsure before, still unsure now. If it is passed I think the court will throw it out, but in Illinois politics and courts anything might happen.


  15. - Wensicia - Friday, Nov 22, 13 @ 1:08 pm:

    No, not likely. “But there’s no plan.” doesn’t sound very optimistic to me.


  16. - Tsavo - Friday, Nov 22, 13 @ 1:15 pm:

    just asking,

    I believe the formula was 3% of $1,000 for a maximum of 30 years. So a 25 year employee is $750 and a 30 year employee is $900.

    Of course with the pensions being in such a catastrophic condition, will the four Legislative Leaders include Judges? I didn’t think so.


  17. - DuPage - Friday, Nov 22, 13 @ 1:20 pm:

    They could adjust “the ramp”, and retire high interest pension obligations with lower interest bonds. That would lower the long term payments without touching the benefits. I think that is probably what they will do if the court throws out pension cuts. I wonder why that was not done years ago.


  18. - Union Man - Friday, Nov 22, 13 @ 1:21 pm:

    ==will the four Legislative Leaders include Judges? I didn’t think so.==

    Could there be a discrimination lawsuit on this issue alone?? Just asking.


  19. - PublicServant - Friday, Nov 22, 13 @ 1:29 pm:

    It really doesn’t matter what the plan is. If they’re allowed to diminish benefits for current employees and retirees, this will only be their first bite at the apple regardless of how big a bite that might be this time.


  20. - Capitol View - Friday, Nov 22, 13 @ 1:32 pm:

    I have been saying for a while that a pension fix was likely this fall, a year before the next electioins and this being the last chance to avoid anoither full 3% COLA as of January 1st.

    But I thought the Illinois Supremes would rule on a proposal before there was any broadening of the Cook County test vote case. My understanding is that our Governor has not even signed that bill yet! Mind boggling — unless he and Da Speaker have a grand strategy in place, and the Supremes have already given informal word of their acceptance.


  21. - Norseman - Friday, Nov 22, 13 @ 1:34 pm:

    Shouldn’t happen, but more likely. Agree with those pointing out that Madigan wouldn’t call them back if the odds weren’t good (bad).

    If it’s like what has been put out before, Radogno’s idea of giving “a retiree annual increases of 3 percent of an amount equal to the number of years they worked for state government, a university or Downstate and suburban school district, multiplied by $1,000″ is a Joke. It was a cap. If your annuity is over that cap, you will not receive any COLAs - ever.


  22. - Tsavo - Friday, Nov 22, 13 @ 1:41 pm:

    Union Man,

    We need RNUG’s opinion on this topic.

    DEFINITION FROM NOLO’S PLAIN-ENGLISH LAW DICTIONARY

    The right, guaranteed by the Fourteenth Amendment to the U.S. Constitution, to be treated the same, legally, as others in the same situation. If a law discriminates between one group of people and another, the government must have a rational basis for doing so.


  23. - RNUG - Friday, Nov 22, 13 @ 1:41 pm:

    Haven’t changed my mind. Something will pass but without enough votes to be effective immediately.


  24. - Anon. - Friday, Nov 22, 13 @ 1:43 pm:

    ** ==will the four Legislative Leaders include Judges? I didn’t think so.==

    Could there be a discrimination lawsuit on this issue alone?? Just asking.**

    I would say, “Not a successful one,” because it should be easy to argue that judges are different from other state employees. However, if they can screw the other employees, they can screw the judges, too, so merely leaving the judges out this time won’t cause any judge smart enough to button his own robe to uphold the law. As public servant says, if they can do it this time, the will do it again.


  25. - A guy... - Friday, Nov 22, 13 @ 1:46 pm:

    Voted more likely, but not too likely.


  26. - east central - Friday, Nov 22, 13 @ 1:53 pm:

    No change, somewhat likely to pass. Could still fall apart. Passing something moderate helps the D’s stay in power, which is why it is likely to pass. But this will make it tough to get R votes.

    If the D’s go heavy on the cuts to attract R votes, then there will be scars that will never heal with pension system members and related unions. Getting primaried in the future is one consequence. And with term limits possible, does the D Party want to alienate a large chunk of its base if teacher union members, etc., are angry about deep cuts in pensions for the rest of their lives?

    But they do need to pass something to survive this election cycle.

    By this logic, moderate cuts and few R votes seems most likely. And if there are few R votes, the D’s will campaign on the R’s not supporting pension reform.


  27. - RNUG - Friday, Nov 22, 13 @ 2:07 pm:

    Union Man @ 1:21 pm:

    Purely a guess, but I think the GA might be playing with fire by leaving the judges out. It could be the crack that lets a lawsuit move from state court to federal court under equal rights claims.

    I’m just not sure about that because the feds may say to pursue it under the various State equal rights laws (or at least do that first). Here’s some from the Illinois Constitution that might be applicable (emphasis added):

    ARTICLE 1, SECTION 2. DUE PROCESS AND EQUAL PROTECTION
    No person shall be deprived of life, liberty or property without due process of law nor be denied the *EQUAL* protection of the laws.

    ARTICLE 1, SECTION 16. EX POST FACTO LAWS AND IMPAIRING CONTRACTS
    No ex post facto law, or law impairing the obligation of contracts or making an irrevocable grant of *SPECIAL PRIVILEGES* or immunities, shall be passed. (Note: the word irrevocable limits special privileges but, in some instances, federal tax codes may result in pension changes being effectively irrevocable).

    ARTICLE 4, SECTION 13. SPECIAL LEGISLATION
    The General Assembly shall pass no *SPECIAL* or local law when a general law is or can be made applicable. Whether a general law is or can be made applicable shall be a matter for judicial determination.

    Anyway, the federal 14th amendment cited by Tsavo is probably clearer and more on point in terms of discrimination. Illinois only explicitly bans all discrimination in the areas of employment & real estate (17), and only prohibits general discrimination on the basis of sex (18) and handicap (19).

    The above is layman’s guess. Maybe Old and In The Way will drop by and give his opinion.


  28. - DuPage - Friday, Nov 22, 13 @ 2:10 pm:

    Norseman, I may be mistaken, but I thought it was 3% non-compounding on $1000 per number of years up to 30 years, total possible $900. You would still that increase if your annuity is more then 30000, but only on the first 30000. Still a big joke. Someone with a 60000 for example would still get $900 (1 1/2%). Please double check, if it means 0% over 30000 that is WORSE then SB1.


  29. - Cassandra - Friday, Nov 22, 13 @ 2:14 pm:

    I said yes, more likely (said no before). The union is doing those emergency lobby days, and they can read the tea leaves better than I can. They must think something is up for December.


  30. - DuPage - Friday, Nov 22, 13 @ 2:14 pm:

    Typo, Last sentence, I meant 0% on the entire amount if you were over 30000.


  31. - dupage dan - Friday, Nov 22, 13 @ 2:16 pm:

    Hard to imagine MJM calling for folks to be available in 12/13 if he didn’t have confidence something will come to a vote, and that the vote will likely be for a plan he supports. RNUG is right that it will be a simple majority - the best outcome that can be expected. Gets ‘em past the next election with folks attention diverted and then we await the court outcome.


  32. - RNUG - Friday, Nov 22, 13 @ 2:18 pm:

    I have an interesting question about how they will calculate the years worked. Several groups, and specifically the SERS 2002 ERI group, worked one amoutn of years but were able to buy up to 5 additional years. They actully paid cold, hard cash (4% of current salary * up to 5 years, max of 20% of salary) into the pension fund just as if they had worked those years.

    Since the ERI people paid for those “extra” service years, will they be used in Radogno’s COLA formula?


  33. - DuPage - Friday, Nov 22, 13 @ 2:22 pm:

    RNUG, can they just buy time or does it have to be for time in the military or some other qualifying reason?


  34. - mythoughtis - Friday, Nov 22, 13 @ 2:33 pm:

    Dupage-

    Normally you can buy your first six months, any qualifing military time, time you gave up if your previously employed by the state. However, RNUG is referring to a specific offer during one of the early retirement incentives that allowed those retiring to buy 5 years of service. That allowed those within 5 years of normal retirement go get the amount of time they needed to feel ok about retiring sooner than expected.


  35. - mythoughtis - Friday, Nov 22, 13 @ 2:34 pm:

    sorry, qualifying, not qualifing

    you were previously employed, not your previously employed.
    to get, not go get.

    Fingers quicker than the brain.


  36. - RNUG - Friday, Nov 22, 13 @ 2:43 pm:

    DuPage,

    In general, it has to be for a clearly defined reason like military service or re-purchase of previously cashed out service credit. There used to be a program under TRS for buying a few years, but I don’t know those details.

    There was one special program: the 2002 Ear;ly Retirement Incentive aka ERI. When the State wanted to get rid of some of us, they offered a one-time deal in 2002 to SERS (and other groups) employees 50+ that, if we agreed to retire “early”, they would “give” us 5 years of age on the Rule of 85 calcualtion and, if the employee wanted to, they could buy up to 5 years additional service time. Some employees needed to buy the 5 years in order to make “85″, most of us took one look at the deal and the math said buy the 5 years whether you needed it or not. I didn’t need it but I bought it because the up front cost was quickly offset by the higher pension payments. You can argue the State offered too good of a deal, but that was their choice … the employees had no input into it.

    As a bit of background, originaly the 2002 ERI was intended to reward a limited number of higher up appointees so they could retire before Blago took office and fired them. The State found out one of those nasty equal treatment clauses required the State to offer the deal to ALL employees … and 11,000 of us said THANKS & BYE!

    The State did benefit from it because the next few year’s GRF personel costs were much lower since a lot of peopel did not get replaced and those that were hired received lower salaries. Plus, from a policital standpoint, those open job slots could be filled with people that supported Blago. Short-term, the pension funds benefited from an influx of cash but they also had to start pay-offs about 5 years earlier than previously projected.

    It would probably be a fair summary to say the 2002 ERI generated some short terms savings at the expense of additional long term liabilities. It also contributed to a massive loss of institutional knowledge since it was all the long term / senior people who left … and I’m not sure the State has yet recovered from that loss.


  37. - RNUG - Friday, Nov 22, 13 @ 2:53 pm:

    BTW - I don’t know Radagno’s thinking, which is why I posed the question.

    I do know CMS was going to include the purchased years when they planned to use years as part of the health insurance cost calculation.


  38. - Illinoyed - Friday, Nov 22, 13 @ 3:09 pm:

    Good point about buying years of service, RNUG. Teachers moving in from out-of-state often transfer their pension credits by buying service years from TRS (thereby closing out credits from their previous pension plans). Denying them fully credited COLA’s for those years would invite a nasty lawsuit just of its own.


  39. - Diogenes in DuPage - Friday, Nov 22, 13 @ 3:11 pm:

    Given the parks pension bill and a possible suit IF it is signed, and given the primary season and the 2014 election year, I STILL don’t see action occurring before January 2015.


  40. - RNUG - Friday, Nov 22, 13 @ 3:37 pm:

    Illinoyed @ 3:09 pm:

    Thanks for clarifying TRS.

    IF the GA is going forward with something like that, then they will need language clarifying that the 3% * $1000 * years COLA calculation is based on the same number of service years the actual pension is being paid on.


  41. - RNUG - Friday, Nov 22, 13 @ 3:51 pm:

    Interesting. Right now the poll is split exactly 50/50 when you split it between the people who think it was/is likely and isn’t likely/less likely.


  42. - Ruby - Friday, Nov 22, 13 @ 4:12 pm:

    Please explain to me again why the state legislators will vote to reduce their own pension benefits along with the state workers’ pension benefits, since most voters are focused on the holidays now, and not on state pensions.


  43. - Anon - Friday, Nov 22, 13 @ 4:56 pm:

    Agree with PublicServant. Any reduction,no matter how small,for current workers or retirees will negate the constitutional protection clause. If the SC upholds it,there will be far greater reductions to follow.


Sorry, comments for this post are now closed.


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