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* Mark Brown…

The city of Chicago’s last chance for finding a semi-soft landing to its pension crisis appeared to fade away Tuesday as the Illinois Supreme Court looked askance at Mayor Rahm Emanuel’s plan to save two of its troubled pension funds.

Just as they were when state officials argued they had found the magic legislative end run to the Illinois Constitution’s strict pension protection clause for public employees, the justices were tough in their questioning of City Corporation Counsel Stephen Patton, signaling that they’re no more impressed by the city’s effort to thread the needle.

Tough questions aren’t always an indication of how a court will rule, but when coupled with the court’s earlier ruling overturning the state’s pension reform efforts, this would seem a good time for everyone to buckle up in anticipation of when they do.

Every other story is pretty much the same.

posted by Rich Miller
Wednesday, Nov 18, 15 @ 2:16 pm

Comments

Years have been wasted indulging Ty and the Tribbies silly pipe dreams.

Comment by wordslinger Wednesday, Nov 18, 15 @ 2:26 pm
Citizens have the right to work for their democratically elected governments. They have a right to the pensions they earned. Politicians cannot scapegoat former or current public servants just to serve their political interests. It is contractual law. It is constitutional law.

Politicians do not have the right to screw retirees out of their contracted pensions, regardless of their political arguments, or their popularity.

To allow these games means allowing all citizens to be misused and taken advantage of by our government.

You cannot do it. It is illegal.

There is nothing illegal with taxing retirement income of all citizens. There is nothing illegal about raising taxes. There is nothing illegal about putting BACK INTO PLACE a 5% income tax that did not negatively effect our economy.

How many times do these legislators and aldermen need to be publically spanked before they feel chastised enough to look elsewhere to balance our budgets?

Comment by VanillaMan Wednesday, Nov 18, 15 @ 2:31 pm
That clause in the constitution is very, very difficult to understand.

Comment by 360 Degree TurnAround Wednesday, Nov 18, 15 @ 2:31 pm
The City recently passed a budget that is obviously unbalanced, even after the tax increase and their extortion demands from Springfield.

No sympathy for Chicago. They shorted pensions for years. Now they are receiving a reality check.

Pay your pensions and balance your budget, Chicago. If that means using TIF $ or even higher city taxes, you can thank Daley and the City Council. The state has its own budget to fix and their own pensions to pay.

Comment by Formerly Known As... Wednesday, Nov 18, 15 @ 2:33 pm
Plain language trumps all. ‘Shall not be diminished or impaired’ means what it says.

Comment by Independent retiree/lawyer/journalist Wednesday, Nov 18, 15 @ 2:36 pm
==Years have been wasted indulging Ty and the Tribbies silly pipe dreams. ==

+ the years spent indulging Daley and Chicago Dems silly budget dreams. /s

Chicago Democrats refuse to live within their means, and Chicago Republicans want to dine and dash. No adults in the room.

Comment by Formerly Known As... Wednesday, Nov 18, 15 @ 2:39 pm
No sympathy for Chicago.

Anyone who could write that after understanding the City’s importance to Illinois in every way, ought to be banned for life. You cannot separate Chicago from Illinois without destroying Illinois and turning it into some kind of Yankee Arkansas.

Arkansas - home of Wal-Mart, your model for government, right?

Comment by VanillaMan Wednesday, Nov 18, 15 @ 2:40 pm
===You cannot separate Chicago from Illinois without destroying Illinois and turning it into some kind of Yankee Arkansas.===

+1

Comment by Rich Miller Wednesday, Nov 18, 15 @ 2:42 pm
I like Yankee of Arkansas - except it would be shortened to Yankansas. But we would pronounce the “s’s”

Comment by 360 Degree TurnAround Wednesday, Nov 18, 15 @ 2:42 pm
…refuse to live within their means…

Yup - your model for government is perfect for a backwater joke of a state, not Illinois.

Comment by VanillaMan Wednesday, Nov 18, 15 @ 2:43 pm
I will be surprised if the ruling is anything other than 7-0 on tossing out Chicago’s pension “reform” attempt.

Comment by RNUG Wednesday, Nov 18, 15 @ 2:43 pm
From Robert Feder ==Up to now, Mayor Rahm Emanuel’s administration seems unaware that the city could reap a windfall as high as $474,185,700 by relinquishing the license of WYCC-Channel 20, the little-watched noncommercial television station operated by City Colleges of Chicago.

That’s the official estimate of the Federal Communications Commission as the opening bid for the license in a government-sponsored auction of the broadcast television spectrum. The voluntary auction, to be held in early 2016, is intended to help meet the growing demand of mobile wireless providers for more spectrum space. Licensees have until December 18 to commit to the FCC auction process.==

But Chicago has to short pensioners?

Comment by Formerly Known As... Wednesday, Nov 18, 15 @ 2:46 pm
I still say Mayor Rahm had to do it. Otherwise, it would have been coulda woulda shoulda all day long during the upcoming budget hassles. And they will be hassles.

Comment by Cassandra Wednesday, Nov 18, 15 @ 2:46 pm
It can’t be 7-0, two recused.

Comment by Anonymous Wednesday, Nov 18, 15 @ 2:48 pm
==No sympathy for Chicago. They shorted pensions for years.==

GA (state law) determines how much money the City gives to the pension funds, so part of the blame is certainly on the GA. GA also increased benefits many times without increasing the funding.

Comment by Name/Nickname/Anon Wednesday, Nov 18, 15 @ 2:48 pm
Chicago pension debt = Daley Legacy

Comment by JS Mill Wednesday, Nov 18, 15 @ 2:50 pm
Instead of the police powers argument they have come up with a twist on that by saying that the fund alone is responsible for the pension payments - by statute - and all the pension protection clause does is protect benefits from being diminished until the fund runs out of money. Of course for this to be true the pension protection clause means nothing, because you only have to do what the city has done — starve the fund and then claim there is no way to make the payments when the fund goes broke. The idea that proper funding is consideration for reducing pension benefits is laughable, and don’t believe will set well with the justices. The city’s consideration argument goes like this….the fund will go broke so we are going to reduce your benefits and now we really promise to make the proper payments so you will get your now reduced benefits. I don’t thin the court is going to be amused by yet another attempt to trash the constitution. I am glad the state appealed so that we can have yet another (7-0) iron clad ruling by the ISC who now must make it even more super duper clean that what they said in every possible way is really really really what the constitution means. More nails in the pension theft coffin please!

Comment by Facts are Stubborn Things Wednesday, Nov 18, 15 @ 2:50 pm
Perhaps I should have said 5-0 decision.

Comment by Facts are Stubborn Things Wednesday, Nov 18, 15 @ 2:52 pm
FKA, I don’t really understand your snark.

My point was that years have been wasted getting down to business addressing the issue as politicians indulged the pipe dreams of Ty and the Tribbies of simply legislating away contracted obligations for services already rendered.

The Constitutional language and the motivation for it could not have been more clear. But the deep-thinkers thought they could weasel out of paying the freight. Why they thought that given the Constitutional language was written at a sixth-grade level is beyond me.

Comment by wordslinger Wednesday, Nov 18, 15 @ 2:53 pm
I thought it was a weak argument to begin with.

Comment by Stones Wednesday, Nov 18, 15 @ 2:53 pm
The court has made it clear that the funding is up to state/city but the benefits must be paid. That was an expressed purpose of the pension protection clause — to indirectly force proper funding because the entity knew the benefits would have to be paid. Now the city wants to offer proper funding after all these years as consideration for reducing benefits that the constitution prohibits…WOW there is no end to the clever minds that attempt to undermine our “rule of law”.

Comment by Facts are Stubborn Things Wednesday, Nov 18, 15 @ 2:58 pm
== GA (state law) determines how much money the City gives to the pension funds, so part of the blame is certainly on the GA. ==

Actually, that sets the minimum. Nothing stops the city from putting in more.

Comment by RNUG Wednesday, Nov 18, 15 @ 2:59 pm
==Pay your pensions and balance your budget, Chicago.==

==Arkansas - home of Wal-Mart, your model for government, right?==

Detroit - home of unbalanced budgets and shorted pensions, your model for government, right?

Comment by Formerly Known As... Wednesday, Nov 18, 15 @ 3:00 pm
FKA, for crying out loud, that’s a reverse auction opening price. Stations would be undercutting each other to sell, not bidders jacking up the price to buy.

Try the google. There are profitable stations with spectrum space for sale around the country right now. The most expensive is one in Houston listed for $2.9 million.

Comment by wordslinger Wednesday, Nov 18, 15 @ 3:09 pm
It is time for Rahm to accept the fact that it is time to pay more money into the city pension plans. As I see it, more major tax increases for Chicago are what are in store for the near future to balance the books.

Comment by Hit or Miss Wednesday, Nov 18, 15 @ 3:18 pm
@wordslinger - you said it well in your comment regarding the misguided attempts at ==fixing== the crisis.

It merely prompted a memory of the cause of this crisis.

The ==/s== was more irritation at the Democrats and Republicans digging this hole and now trying to abandon the public, plus a sign the comment was not criticizing your comment but the situation.

Comment by Formerly Known As... Wednesday, Nov 18, 15 @ 3:23 pm
== It can’t be 7-0, two recused. ==

Forgot about that. Of course, being recused is the same as voting “Present” in the GA.

Comment by RNUG Wednesday, Nov 18, 15 @ 3:27 pm
Word nails it. The amount of time and money taken by politicians - egged on by the big money boys - to skirt their responsibility is disgusting. It’s time to address the refinancing of the debt as opposed to trying to screw current employees and retirees.

Comment by Norseman Wednesday, Nov 18, 15 @ 3:27 pm
Wall Street bankers’ contracts were deemed so sacred that even after they crashed out Main Street in 2008 to the tune of trillions, they received their contractual bonuses.

Comment by Glenn Wednesday, Nov 18, 15 @ 3:27 pm
FKA “Detroit - home of unbalanced budgets and shorted pensions, your model for government, right?”

Detroit’s pensions were balanced and the pensions were funded better than in Chicago currently. The City’s real estate lost too much value and they couldn’t fund core services and make the retiree benefit payments at the same time.

Comment by Al Kaline Wednesday, Nov 18, 15 @ 3:33 pm
An interesting twist this time was the City arguing this was “Ok” because Rahmbo had coerced a batch of unions into signing on to the deal.
Justice Thomas was having none of that and told Rahm’s lawyer, “we are not debating a collective bargaining agreement.” Zing.

Comment by Arthur Andersen Wednesday, Nov 18, 15 @ 3:54 pm
Let’s not forget that it wasn’t until the pension reforms passed a few years ago establishing Tier 2 that Chicago was required to make annual required contributions.

Comment by GA Watcher Wednesday, Nov 18, 15 @ 4:07 pm
===the license of WYCC-Channel 20===

Which is owned not by the city itself, but by the City Colleges of Chicago. Not that an IG agreement couldn’t be reached, but let’s be clear who actually owns this asset (which is not worth even close to that staggering figure).

Comment by 47th Ward Wednesday, Nov 18, 15 @ 4:10 pm
===which is not worth even close to that staggering figure===

Correct.

Comment by Rich Miller Wednesday, Nov 18, 15 @ 4:14 pm
==Let’s not forget that it wasn’t until the pension reforms passed a few years ago establishing Tier 2 that Chicago was required to make annual required contributions. ==

This is not true, they always had to make annual contributions, those contributions are just not sufficient

Comment by Name/Nickname/Anon Wednesday, Nov 18, 15 @ 4:47 pm
@wordslinger - Feder covered the media for 30+ years. Why did he write this if it is useless?

The station has a 0.1 rating and 0.0 share, it could stay on air, some sale estimates are $100 Mill to $200 Mill, and WYCC can exit the auction process at any time if the price drops too low.

The Times reports ==A simpler auction last year, which sold airwaves widely seen as less desirable than those held by the TV stations, raised $41 billion.== The Tribune ==”Stations like WYCC, a noncommercial station, are in the position to reap an astonishing amount of money,” Robert Heymann Jr., head of the Chicago office of Media Services Group, told us.==

Why are experts Feder and Heymann wrong iyho?

Comment by Formerly Known As... Wednesday, Nov 18, 15 @ 4:49 pm
===Feder covered the media for 30+ years===

He’s not a business reporter. He misread it is all. No big deal, just not worth quoting.

Comment by Rich Miller Wednesday, Nov 18, 15 @ 4:51 pm
Name: Chicago was never required by state statute to make annual required contributions prior to the Tier 2 bill. Prior to that time, the Mayor and the City Council were free to determine - without any actuarial basis if they so chose - the amounts contributed.

Comment by GA Watcher Wednesday, Nov 18, 15 @ 4:52 pm
==He’s not a business reporter.==

We learn something daily. It did not seem he could be so wrong with such experience. Gracias for clearing things up.

Comment by Formerly Known As... Wednesday, Nov 18, 15 @ 5:11 pm
The state already dealt with this. Why is this different and the city was granted an appeal. I guess it was a courtesy? It would have been nice for them to make their judgement right then and there but I suppose they have to come up with something eloquent to say about repeating the answer….NO

Comment by Jack Retired Water Wednesday, Nov 18, 15 @ 5:21 pm
FKA, Tribune Media has 43 TV stations around the country, including WGN-9.

It has a market cap of $3.5 billion.

I don’t know what Feder is thinking, but the idea that you could peddle Channel 20 for half a billion is loopy.

I noticed though that alleged biz journalism guru Dan Miller thinks it’s a hot story, lol.

Comment by Wordslinger Wednesday, Nov 18, 15 @ 5:39 pm
== The state already dealt with this. Why is this different and the city was granted an appeal. I guess it was a courtesy? ==

Got a feeling the IL Supreme Court intends to hammer some points home with this ruling.

Comment by RNUG Wednesday, Nov 18, 15 @ 7:41 pm
=== The state already dealt with this. Why is this different and the city was granted an appeal. I guess it was a courtesy? ===

I believe Supreme Court review is always granted when the lower court tosses a law.

Comment by Norseman Wednesday, Nov 18, 15 @ 7:49 pm
I agree with most of what was said but the Labor entities have to take some responsibility as well. Every contract had more on the check than on pension. This was negotiated and agreed on by both parties. In today’s age it’s hard to get a raise and a bigger contribution to pension funding. Not every year was a holiday. Most years the city paid what was required under the law. Keep in mind the the requirement is far below the actuarial amount that was needed. Everyone saw this coming for years but all the contracts had money on the check.

Comment by Chicago(D) Wednesday, Nov 18, 15 @ 7:58 pm
And the definition of insanity is: Doing the same thing and expecting a different result.

Comment by justacitizen Wednesday, Nov 18, 15 @ 8:11 pm
@Jack Retired Water -
When a trial court declares a statute invalid for any reason, there is an automatic appeal directly to the Illinois Supreme Court under Court Rule 302(a). Since every trial court judgment carries an absolute right of one appeal, the Supreme Court in these cases must take the appeal (if one is filed) under Illinois law. It’s not a “courtesy”; it’s required by court rules. Of course, the Court could issue a summary opinion to deal with the case per Rule 302(c), but like RNUG, I have a feeling the Justices are going to issue a “because you obviously didn’t read our last opinion, let us say this again with appropriate emphasis” kind of decision.

Comment by jdcolombo Wednesday, Nov 18, 15 @ 8:37 pm
==Instead of the police powers argument they have come up with a twist on that by saying that the fund alone is responsible for the pension payments - by statute - and all the pension protection clause does is protect benefits from being diminished until the fund runs out of money.==

Sidley and Austin gave the governor’s office a legal memo based on this theory years ago. It’s so weak that even Quinn chose to go with Squeezy rather than try rely on it.

Comment by Anonymous Wednesday, Nov 18, 15 @ 9:28 pm
Thank you Professor Columbo.

Comment by Norseman Wednesday, Nov 18, 15 @ 9:40 pm
== Sidley and Austin gave the governor’s office a legal memo based on this theory years ago. ==

Yep. The Chicago “pension reform” was another run at using the Sidley & Austin unearned benefits / police powers theory and also the Madiar & Cullerton consideration theory of contract law.

Going to be interesting to see what the Justices actually write.

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