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Problems emerge with Preckwinkle’s pension bill

Thursday, May 29, 2014

* I told subscribers this morning that no House Republicans were willing as of last night to put votes on Cook County President Toni Preckwinkle’s pension reform bill. No pension reforms have ever passed the House without at least a couple dozen GOP votes. So, big trouble.

Greg Hinz reached out to Leader Jim Durkin today

“A number of our members continue to express concerns because this bill does not go far enough to achieve meaningful benefit reform — and worse, seemingly relies heavily upon increases in residential and commercial property taxes,” Mr. Durkin said in a statement.

In particular, he added, Ms. Preckwinkle’s bill provides more generous annual cost-of-living adjustments in pension payments than does the city bill, guaranteeing at least 2 percent a year, compounded, and potentially as much as 4 percent, as opposed to half of inflation, simple, with a 3 percent cap. “This bill does not match the structural changes previously enacted by the General Assembly. Furthermore, the business community has not weighed in on this bill as they previously have with the other state pension reform and Chicago pension reform bills,” he said. […]

And, for the record, both Mr. Durkin and other Republicans are denying that GOP gubernatorial nominee Bruce Rauner is behind the opposition. Mr. Rauner wants to completely abolish defined-benefit government pensions, moving to a 401(k)-style system

I talked with a labor lobbyist not long ago who said the union is holding their “No” votes so far, but that the situation remains “fluid.” If the GOPs stay off, President Preckwinkle has real problems with this legislation.

- Posted by Rich Miller        

19 Comments
  1. - Frank B. - Thursday, May 29, 14 @ 3:00 pm:

    It would interesting if Preckwinkle toughened the bill up to get a few Republican votes and it passes. Then AFSCME will have helped kill the most employee-friendly pension bill yet in exchange for something more punitive for their members.


  2. - Almost the Weekend - Thursday, May 29, 14 @ 3:07 pm:

    Totally agree Frank. I would love to see the look on rank and file AFSCME members’ faces if this pension bill becomes tougher to garner more Republican votes.

    In the long-run it could be addition by subtraction. AFSMCE’s leadership has been swimming against the current for the past four years and going nowhere fast.


  3. - Barney - Thursday, May 29, 14 @ 3:12 pm:

    something is a bit fishy. the chicago bill called for anywhere between $250-$750 million in property tax hikes that durkin supported. Cook Cty only has a deficit of $140 million that they could try to fill through streamlining and such, but prob need to hike some taxes. What’s the real story here?


  4. - Chi - Thursday, May 29, 14 @ 3:16 pm:

    =the most employee-friendly pension bill=

    current-retiree-friendly is different than employee-friendly


  5. - low level - Thursday, May 29, 14 @ 3:18 pm:

    “Rauner is not behind the opposition … He favors a switch to 401(k) style plans” - Durkin and other Republicans.

    This sort of makes sense, I suppose (Republicon artist style.) He doesn’t favor any reforms - rather, he is opposed to the whole system and won’t be satisfied until every last pension - averaging $30k, is put at risk.

    Rauner is a clown. He expects everyone to become a stock market expert. Now, part of my retirement is in a 401(k) style system. However, I know a thing or two about investing. Suddenly, though, the 60 year old teacher who has spent her entire career education our children is supposed to have the financial instincts of a MBA.

    Give me a break, Bruce.
    Republi-con artists.


  6. - titan - Thursday, May 29, 14 @ 4:56 pm:

    Aren’t there signigicant cash flow problems for the state if such a 401(k) type system were put into place?
    How would the state pay the pensions of the current retirees without being able to use the money being paid in by the current employees?


  7. - Property taxpayer - Thursday, May 29, 14 @ 5:00 pm:

    Durkin has it nailed. The mayor’s pension Reform Bill has received extraordinary scrutiny, both by the media and by civic and fiscal organizations. Preckwinkle’s has gotten little attention. The attention it has received indicates it is woefully inadequate in reducing future pension costs. Her unwillingness to identify the source of the $140 million before her election is further evidence of the political nature of this so-called “reform”.


  8. - NoBody's Perfect - Thursday, May 29, 14 @ 5:25 pm:

    Here at ShakeyMitt HQ we are disappointed Durkie is not confirming powerful bid to kill the County pension bill…how can we show our cool, cash driven “power” if we don’t get credit?
    Come on Durkie sing our little song.


  9. - low level - Thursday, May 29, 14 @ 5:58 pm:

    Last time I checked, Property Taxpayer, Cook County Government workers pay property taxes as well if they own a home.

    News flash - they pay the same taxes everyone else does, so I’m really not sure where you are coming from.


  10. - NoBody's Perfect - Thursday, May 29, 14 @ 7:04 pm:

    Up here at ShakeyMitt HQ we are deeply saddened that our bid/threat to oppose the PQ road program failed. Perhap Durkie has found a new barrel of campaign cash to replace lost due to our boycott.


  11. - DuPage - Thursday, May 29, 14 @ 7:53 pm:

    Preckwinkle might have a problem with the Illinois constitution. She could cut for future employees, but existing employees would be covered by the pension protection clause, same as the state pensions.


  12. - Andrew Szakmary - Thursday, May 29, 14 @ 9:03 pm:

    I agree with DuPage. This rush to enact pension diminishment legislation that is patently unconstitutional, before the courts even rule on similar existing legislation, is the height of absurdity and an unconscionable waste of time and resources.


  13. - Anonymous - Thursday, May 29, 14 @ 9:55 pm:

    Didn’t have time to weigh in until now. Everyone, city, county, etc. should put their desire for pension changes on hold until the current law suit is resolved; otherwise it is highly likely they will be back having to re-do it after forking out payment for losing a law suit.

    Plus Quinn should be against any changes at the local property tax level right now. He’s most likely going to have to shove a portion of the TRS and SURS pension payments onto the local taxing districts and he doesn’t want them to have already tapped out the property taxpayer.


  14. - Mr.Big Trouble - Thursday, May 29, 14 @ 10:07 pm:

    You don’t need the financial instincts of an MBA in order to create a reasonable portfolio for retirement. That’s a lie promulgated by the financial services industry– trust us because we know so much more than you do. There is plenty of good material available for someone to educate himself on the basics of investing and to do well. Keep it simple and take charge of your own education and destiny and you will do fine.


  15. - anon - Thursday, May 29, 14 @ 10:14 pm:

    This bill is far worse for current employees than SB1 or the City bill. As pointed out above, the retirees are barely touched. But the unions don’t represent the retirees.

    Also, I have not had time to read the final bill but her initial proposal to the unions had a clause that the County would pay NO cost of living whatsoever if the funding remained below a certain level. Would anyone trust the County not to deliberately underfund for the sole purpose of eliminating COLA entirely?


  16. - RNUG - Thursday, May 29, 14 @ 10:23 pm:

    Oops … don’t know exactly what happened but - Anonymous - Thursday, May 29, 14 @ 9:55 pm was I …


  17. - Federalist - Thursday, May 29, 14 @ 10:23 pm:

    Are these employees on SS also?


  18. - Cold - Friday, May 30, 14 @ 7:22 am:

    Cook County employees do not have Social Security.


  19. - Sean Tankarian - Friday, May 30, 14 @ 11:28 am:

    The pension egg started to crack for the private sector in the 80s as declining asset prices put too much pressure on corporations to pay future debt obligations. The public sector depends on the private sector for funding of salaries, benefits, etc. so the stress in the public sector is understandable given the economic climate over the past 10+ years. Public sector pensions will be around for some time, but adjustments are obviously needed. At its core the pension issue is a debt issue and dealing with debt is very painful. publicretirementplanners.blogspot.com


Sorry, comments for this post are now closed.


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