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If you’re looking for something good amid all the rotten news in Illinois, here’s a little something: Gov. Bruce Rauner says there’s some agreement on the fundamentals of a pension reform plan.

That’s not to say that a deal is imminent, he cautioned.

“The president of the Senate (John Cullerton) and I agree on what it’s going to take to have a constitutional pension reform, and the speaker’s staff is not disagreeing. I can’t say they’ll be out there proactively being positive, but they’re not really disagreeing. And that’s a big deal,” Rauner said.

It’s a big deal if it gets worked out, resulting in “billions of dollars in pension savings at the universities as well as school districts and state government,” the governor said.

But state employee unions already indicated opposition to Cullerton’s plan, which is said to include a provision that makes employees choose between retaining cost-of-living increases in retirement or taking pay raises now. That may not be the offer made to employees.

* So, I reached out to Cullerton’s press secretary John Patterson. His response…

“There are still major differences regarding the recognition of collective bargaining rights.”

* And here’s Speaker Madigan’s spokesman Steve Brown…

“I don’t think that, unfortunately, they’re anywhere close to a constitutional plan.”

posted by Rich Miller
Tuesday, Jan 19, 16 @ 2:01 pm

Comments

As Pee Wee Herman used to say when slamming he door shut: “Salesman!”

Comment by Keyrock Tuesday, Jan 19, 16 @ 2:04 pm
I continue to believe that any plan that saves “billions” of dollars will seriously ding the affected employees and therefore be unconstitutional.

But maybe Rauner can claim some savings when he does the upcoming fairyland budget(s). But didn’t he already do that?

Comment by Cassandra Tuesday, Jan 19, 16 @ 2:05 pm
“Billions, I tell you, Billions!”

Comment by Anonymous Tuesday, Jan 19, 16 @ 2:06 pm
Wishful thinking.

Comment by Liberty Tuesday, Jan 19, 16 @ 2:06 pm
That’s some hilariously bad journalism there from
Kacich.

“Naw, I’m not going to call Cullerton or Madigan, I’m sure Rauner can speak for them. Has he ever steered anyone wrong before?…”

Comment by wordslinger Tuesday, Jan 19, 16 @ 2:06 pm
“… speaker’s staff is not disagreeing. I can’t say they’ll be out there proactively being positive, but they’re not really disagreeing.”

Sounds like a contractor’s “O.K.” as in “I heard you”, not as in “I agree with you”.

Comment by Anonymous Tuesday, Jan 19, 16 @ 2:07 pm
We members of the Rauner Party of Illinois will be glad to fund higher ed with all the pension fund savings we fanaticize about. The members of the Republican Party of Illinois recommend parents of students with ACTs scores higher than 22 send their kids out of state- Boston is a good place according to GE.

Comment by Rauner Republican Tuesday, Jan 19, 16 @ 2:10 pm
RNUG Get the reading glasses out and your fingers warmed up!!! You are our local expert.

Comment by He Makes Ryan Look Like a Saint Tuesday, Jan 19, 16 @ 2:10 pm
Well, one thing is for certain, someone isn’t telling the truth.

Comment by No Longer A Lurker Tuesday, Jan 19, 16 @ 2:10 pm
Rauner Crew,

You may “win” the Press Pop of alleged “progress”…

Your “partners” in the other 1/3 of state government think the Governor is full of “Baloney”

Pretending is real, you guys “know” that… right?

Pretty pathetic way to message a non-starting idea.

It’s like you guys are tellin’ the boss “The Onion” headlines on what is really goin’ on… and he believes you?

Now, if the Governor is off the reservation, speakin’ from the hip, you guys need to help him, or stop him from speakin’ it’s worked in the past.

It’s a Crew failure that you either are not givin’ the Boss the right info, or you can’t control your Boss to understand that speakin’ in ways that will be refuted by the other actors makes him look…

“Disingenuous”

Please, do better.

OW

Comment by Oswego Willy Tuesday, Jan 19, 16 @ 2:10 pm
Tink….tink….tink,tink,tink….(what’s that noise?) It’s the Governor chipping away at that dam. Getting rid of pensions will help the free flow of capital. The turbines of state should run just as well with the river I’ll create. I just have to get rid of this dam.

Comment by Honeybear Tuesday, Jan 19, 16 @ 2:10 pm
Rauner is like the John who has bought so much female companionship, he thinks they love him and can’t wait to spend time with him.

Dude - your money cannot buy love and it can’t buy friendship either. Your election worked, but now that everyone knows what you are really like, you might not have enough loot to get another chance.

Bruce - it is 2016. It is perpetual rascal hunting season and your face is on the permits.

Comment by VanillaMan Tuesday, Jan 19, 16 @ 2:11 pm
Pensions are an individual benefit belonging to management, union and non-Union alike. What is any discussion of collective bargaining in the mix for? Turnaround Agenda 2?

Comment by Thoughts Matter Tuesday, Jan 19, 16 @ 2:12 pm
What is “pension reform” at this point?

You’re not getting out from under the unfunded liability with some retroactive legislative scheme. That’s been tried.

Comment by wordslinger Tuesday, Jan 19, 16 @ 2:13 pm
“A constitutional plan” and “billions in savings(per year)”

Two ideas that will never coexist in Illinois law.

Comment by Timmeh Tuesday, Jan 19, 16 @ 2:16 pm
I am torqued that they keep going back to schemes they refer to as “pension reforms” (conservative speak for taking away income from the middle class). I say ditch those schemes and come up with an equitable way to fix the budget, such as implementing a progressive income tax.

Comment by illinoised Tuesday, Jan 19, 16 @ 2:22 pm
The biggest hurdle is trying to convince the courts that “extortion” means “consideration.” Next, is trying to convince the extorted that the perpetrators will follow through with the promises.

Comment by Norseman Tuesday, Jan 19, 16 @ 2:31 pm
When Governor Rauner starts talking about shifting the pension payments to local school districts and the universities, then “constitutional pension reform” will be much closer to becoming reality.

Without the locals and the universities stepping up, it really isn’t reform anyway. And the only way it’ll be constitutional is if they pump more money in than the state has on hand.

But watch for it. Madigan has always pushed for the cost shift. If Rauner agrees, we’ll know we’re close to something big happening. If not, don’t hold your breath.

Comment by 47th Ward Tuesday, Jan 19, 16 @ 2:32 pm
fyi to the governor - just because someone isn’t actively disagreeing with you doesn’t mean that they are in agreement with you.

Comment by morgan Tuesday, Jan 19, 16 @ 2:39 pm
==I don’t think that, unfortunately, they’re anywhere close to a constitutional plan==

Didn’t stop you guys before /s

Unfortunately, with the way things are going in Illinois, some sort of pension ==reform== aka ==robbery== will probably be the first item Rauner, Madigan and Cullerton all agree on.

Comment by Formerly Known As... Tuesday, Jan 19, 16 @ 2:50 pm
Speaking of pensions, the state missed their monthly payment to the pensions a couple months back. Have they made the regular monthly payments since then?

Comment by DuPage Tuesday, Jan 19, 16 @ 2:52 pm
Cost shift is there best bet for immediate savings. Ultimately it pushes the cost to the local entity but they get an approximately $1.6 billion load off of the state. They still have $6 billion in debt (pension) payments to make though. Better get to growin’ the economy in a big way.

Comment by JS Mill Tuesday, Jan 19, 16 @ 2:53 pm
Peters v City of Springfield- Illinois Supreme Court. (COGFA) “The court did not explore the full meaning of the “enforceable contractual relationship” with respect to pension benefits as spelled out in section 5 of article XIII of the Illinois Constitution; however it did conclude that the purpose and intent of the provision was to ensure that pension benefits of public employees, once earned, should not be diminished.”

Felt v Board of Trustees: (COGFA)
Holding
Relying on the plain language of article XIII, section 5 of the Illinois Constitution and the proceedings from the 1970 constitutional convention, the court held that the legislative change in the basis of computing a retirement annuity constituted an impairment in the retirement benefits of the plaintiffs, and was therefore unconstitutional. The court
noted that even before the enactment of the 1970 constitution, the Supreme Court held in the 1961 case Bardens vs. Board of Trustees, 22 Ill.2d 56, that a legislative enactment that changes the salary base for computing a retirement annuity constituted a contractual impairment for members already enrolled in the Judges’ Retirement System (the facts in Bardens were essentially the same as Felt). Furthermore, the court found the financial impairment to the pensions of two of the plaintiffs to be substantial and an unreasonable exercise of the state’s police power.” http://cgfa.ilga.gov/upload/2008%20january%20handbook%20of%20illinois%20pension%20case%20law.pdf

Comment by Liberty Tuesday, Jan 19, 16 @ 2:54 pm
The pension issues will perfectly illustrate how much Rauner has poisoned the political well. Two years ago, Madigan and Cullerton were willing to cross labor on pension reform. Not anymore.

Comment by Pete Tuesday, Jan 19, 16 @ 2:54 pm
Kanerva v. Weems, 2014 IL 115811. We held in that case that the clause means precisely what it says: “if something qualifies as a benefit of the enforceable contractual relationship resulting from membership in one of the State’s pension or retirement systems, it cannot be diminished or impaired.”

Comment by Liberty Tuesday, Jan 19, 16 @ 2:57 pm
Amaya’s the Governor should focus on what he knows best- improve upon the investment returns of the state programs since the courts won’t let him touch the benefits

Comment by Sue Tuesday, Jan 19, 16 @ 3:25 pm
Maybe

Comment by Sue Tuesday, Jan 19, 16 @ 3:25 pm
As Rich kind of noted, we’ll know they are serious about LEGAL pension reform when they stop talking about negating the pension debt and start talking about how to properly fund it. Rich is dead on that one of those funding components is going to be a cost shift to the local school districts and colleges. Another part will be offering a voluntary buy-out for some retirees like was discussed here about a week so so ago. In fact, that will be a good idea so the Rauner “brain trust” can bail with their pension money in 3 years.

I had hoped we wouldn’t have to go this route again but it’s clear, despite the various IL SC rulings including the most recent, that Rauner still believes the Sidley Austin delusion that not yet earned benefits can be changed.

I sure hope he’s getting that advice for free … because that’s about what it is worth.

One other observation. By continuing this fantasy, Rauner can pretend the savings are there and kick the can down the road another fiscal year or so while the case goes through the courts. Best case scenario would be for a local judge to rule whatever gets passed unconstitutional and the IL SC just refuse to take the automatic appeal; then Rauner’s only bought a couple of months instead of a year.

Comment by RNUG Tuesday, Jan 19, 16 @ 3:34 pm
Rauner’s claim that you can have raises that are not pensionable seems clearly at odds with the pension code, and so unconstitutional, since the formula for computing final average salary is in the code. If you get a raise, it is pensionable.

So, workers would be left with a choice between (1) no raises but AAI, and (2) raises but no AAI. In this case it would seem clear that the raises are being withheld ONLY to force people to give up their contractual right to the AAI. That seems inconsistent with voluntary consideration.

This isn’t going to get through ILSC.

Comment by Mostly Harmless Tuesday, Jan 19, 16 @ 3:37 pm
I think I’ve figured out Rauner’s pension reform strategy….force AFSCME to strike and fire all employees who don’t cross the picket lines. *POOF* problem solved. In other news, look for the Governor’s upcoming tweet regarding diners for cash-strapped Illinoisans. They’ll offer BILLIONS in savings!

Comment by Cubs in '16 Tuesday, Jan 19, 16 @ 3:56 pm
There’s still that little matter of the shortage of assets in the actual pension funds … while it may reduce it a bit, firing people doesn’t make that go away.

Comment by RNUG Tuesday, Jan 19, 16 @ 4:01 pm
What pay raises? He doesn’t want to give any to AFSCME, and the CMS regulations still prohibit pay raises and bonuses for merit comp. He’s going to have to offer pay raises for there to be anything to swap.

Comment by Whatever Tuesday, Jan 19, 16 @ 4:04 pm
Rauner has no chance of passing this unconstitutional plan unless the Democrats support him.

How about that for the obvious!

So will they? They did with Quinn but somehow that might be different this time

Comment by Federalist Tuesday, Jan 19, 16 @ 4:06 pm
gov messaging looks bipolar. one minute it all antimadigan and failing GA, next its we think we are close on an agreement.

golum must be in the press office my precious….

Comment by Ghost Tuesday, Jan 19, 16 @ 4:07 pm
Best thing to do would be to offer buyouts to retirees and employees. With interest rates still at historic lows, the state can reduce liabilities once and for all on a long-term amortization schedule, at least to those retirees and employees willing to accept the buyout.

Comment by No Raise Tuesday, Jan 19, 16 @ 4:16 pm
–When Governor Rauner starts talking about shifting the pension payments to local school districts and the universities, then “constitutional pension reform” will be much closer to becoming reality.–

I can see a “shift” going forward, but not laying off unfunded liability to date.

That would be the mother of all court battles, which I suspect the state would lose, again.

That $100 million plus nut will have to be paid.

Comment by wordslinger Tuesday, Jan 19, 16 @ 4:18 pm
Madigan already pushed a pension reform plan that was shot down by the courts and Steve Brown is acting like they know the definition between constitutional and unconstitutional?

Comment by Ahoy! Tuesday, Jan 19, 16 @ 4:22 pm
AGAIN. Make the consideration offer worth something to me. The only thing i cant buy is time. Give me an early out of 5 years and I might consider forgoing my 3% compounded for 3% simple.

Comment by Anon Tuesday, Jan 19, 16 @ 4:29 pm
If only the Supreme Court had ruled differently in 1975 and said that Illinois also had to fully (from an actuarial standpoint) fund the pensions that were being offered. If only…

Comment by Chicagonk Tuesday, Jan 19, 16 @ 4:35 pm
-Chicagonk-

I hear you … but there is this little separation of powers issue such a ruling would have ran in to.

Comment by RNUG Tuesday, Jan 19, 16 @ 4:51 pm
-Anon-

This bunch would be more likely to offer you an early out on age only with no opportunity to buy time (or buy it at a high rate) and most likely giving up any AAI at all.

Whatever early out deal they might come up with, it would be more likely at the end of 2018 so the Superstars could bail.

Comment by RNUG Tuesday, Jan 19, 16 @ 4:56 pm
” Give me an early out of 5 years and I might consider forgoing my 3% compounded for 3% simple. ” Anon, the 5 and 5 deal is never going to happen again - the cost is to high. Plus giving up your AAI will never be a good deal.

Comment by Mama Tuesday, Jan 19, 16 @ 5:28 pm
I think New York courts did force funding

Comment by illinois manufacturer Tuesday, Jan 19, 16 @ 6:39 pm
=== fyi to the governor - just because someone isn’t actively disagreeing with you doesn’t mean that they are in agreement with you.===

I thought this only applied to your wife!

Comment by forwhatitsworth Tuesday, Jan 19, 16 @ 7:15 pm
-Mama- It would be interesting to see how the ERI numbers work with all replacement employees being Tier II. There is a big difference between Tier I and Tier II pension benefits. What I’ve heard recently is that employees are leaving at a faster pace than expected, so there is no need for an ERI. An ERI is the only way to legally drastically reduce the number of Tier I employees.

Comment by bassman Tuesday, Jan 19, 16 @ 7:38 pm
Have to actually hire Tier 2 workers to get the savings. If your goal is to fire and outsource, there is no savings from new Tier 2 hires.

Comment by RNUG Tuesday, Jan 19, 16 @ 7:47 pm
@- VanillaMan - Tuesday, Jan 19, 16 @ 2:11 pm:

Rauner is like the John who has bought so much female companionship, he thinks they love him and can’t wait to spend time with him.

Dude - your money cannot buy love and it can’t buy friendship either. Your election worked, but now that everyone knows what you are really like, you might not have enough loot to get another chance.

Bruce - it is 2016. It is perpetual rascal hunting season and your face is on the permits.

Fantastic job, VanillaMan!! These were first rate!

Comment by Lynn S. Tuesday, Jan 19, 16 @ 10:52 pm
For a guy with billions of dollars, he doesn’t seem to grasp the difference between billions, millions, and bupkis.

Comment by Humm Wednesday, Jan 20, 16 @ 8:08 am