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Is the end near for legislator pensions?

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Illinois

* According to this story by Debby Hernandez in the Southern Illinoisan, just seven legislators had opted out of the General Assembly’s pension plan in Fiscal Year 2012…

As of this week, 52 of the General Assembly’s 177 current members have opted out of the pension plan.

Meanwhile, each chamber will consider proposals in the new session to end pension benefits for future legislators.

A House bill would prohibit the retirement system from accepting future lawmakers beginning Jan 1. As part of its “grand bargain” budget package, the Senate proposes an overarching pension reform plan, including restricting the General Assembly plan from accepting any new participants after the legislation is enacted. […]

Of the 17 newly elected lawmakers this year, 12 have opted out, while five have yet to decide whether to accept legislative pensions. New lawmakers have up to two years to decide whether to participate.

posted by Rich Miller
Friday, Jan 20, 17 @ 9:29 am

Comments

The Lobbyist organization applicant pool will increase tenfold.

Comment by PublicServant Friday, Jan 20, 17 @ 9:36 am
Awful news for people who want quality legislators and candidates.

Comment by Chi Friday, Jan 20, 17 @ 9:40 am
Yep, you can tell the quality is high now just looking at the performance. Sheesh.

Comment by Piece of Work Friday, Jan 20, 17 @ 9:43 am
This will play well with the public, especially after stories of legislators leaving office for a job in State government for a year or two to boost their final salary, then retire under the generous terms of their legislators pension.

That said, I wonder if this would affect the type of folks willing to run for office.

Comment by Sir Reel Friday, Jan 20, 17 @ 9:44 am
Agree with both PublicServant and Chi. If taxpayers don’t pay for intelligent, quality people to run for public office, somebody else will.

Comment by Nick Name Friday, Jan 20, 17 @ 9:44 am
Term limits would actually reduce the pension liability. Hard to accrue a big pension if you can only apply 8 years of service (27% service time). Plus Tier 2 would be even cheaper. Although carryover from time spent in other pension systems would inflate those numbers.

Comment by City Zen Friday, Jan 20, 17 @ 10:18 am
== If taxpayers don’t pay for intelligent, quality people to run for public office, somebody else will. ==

Worth repeating.

But…the legislative pension system does need to get a serious haircut. It is much too generous. I assume cutback hits statewide officials too.

Comment by Suburbanon Friday, Jan 20, 17 @ 10:25 am
Does a new legislators start out in Tier 2 (401K)? The same as new state workers?

Comment by Mama Friday, Jan 20, 17 @ 10:26 am
I think this sends the wrong message to ordinary people whom want to run for office and are smart enough to hold a legislative office, but whom are not wealthy enough to take a job without a pension and/or healthcare.

Comment by Mama Friday, Jan 20, 17 @ 10:31 am
No one should in elected office long enough at any level to earn a pension.

Comment by DGD Friday, Jan 20, 17 @ 10:41 am
==Does a new legislators start out in Tier 2 (401K)? The same as new state workers?==

If the legislator was previously employed in another branch of IL govt that was included in the Retirement Systems’ Reciprocal Act, I would assume they would keep retain their Tier 1 status. Otherwise, all new employees fall under Tier 2.

Comment by City Zen Friday, Jan 20, 17 @ 10:42 am
“No one should in elected office long enough at any level to earn a pension.”

Why not?

Comment by Nick Name Friday, Jan 20, 17 @ 10:47 am
==I think this sends the wrong message to ordinary people whom want to run for office and are smart enough to hold a legislative office, but whom are not wealthy enough to take a job without a pension and/or healthcare.==

There is nothing preventing these folks from running for a seat at the federal level. Too big? Then run at county or municipal levels. There are numerous ways for a former GA members to “serve” their constituents outside the GA.

Comment by City Zen Friday, Jan 20, 17 @ 10:48 am
If enough new legislators opt out of the retirement system, payroll contributions to the Fund will drop, meaning the State will have to kick in even more money to pay the benefits of those who remain. (See also, Ponzi Scheme).

Comment by SAP Friday, Jan 20, 17 @ 10:51 am
“not wealthy enough to take a job without a pension ”

Almost all “ordinary people” have to take jobs without pensions. And the legislative salaries are well above state median income. So, for most “ordinary people” it’s a step up, even without a pension of any sort.

Comment by Chris Friday, Jan 20, 17 @ 10:54 am
Just switch the legislator pension plans to become 401k style defined contribution plans. If they serve in office for 4 years, they earned 4 years worth of retirement funds. If they served 20 years then they earned 20 years worth of retirement funds. This way Illinois doesnt have to worry about the legislator pensions going forward.

Comment by Maximus Friday, Jan 20, 17 @ 10:59 am
** Why not? **

Otherwise you end up with entrenched politicians whose only interest is getting re-elected.

Comment by DGD Friday, Jan 20, 17 @ 11:11 am
Legislators are part time, intended to be limited limited length - like McDonalds. They shouldn’t have especially traditional (i.e., defined benefit) pensions.

Comment by justacitizen Friday, Jan 20, 17 @ 11:11 am
So no more legislator double dipping (aka the pension/lobbyist salary combination)?

Comment by Chicagonk Friday, Jan 20, 17 @ 12:21 pm
I think this sends the wrong message to ordinary people whom want to run for office and are smart enough to hold a legislative office, but whom are not wealthy enough to take a job without a pension and/or healthcare.

No talk of legislators not being offered health care. If a pension is required before accepting a job you will have to look very hard.

4 percent of private sector workers receive a pension. I think companies are able to recruit plenty of “good people” without offering a pension.

http://money.cnn.com/retirement/guide/pensions_basics.moneymag/index7.htm

Comment by Lucky Pierre Friday, Jan 20, 17 @ 12:38 pm
GARS is almost bankrupt but will be bailed out by Madigan’s continuing appropriation.

Comment by Sugar dad Friday, Jan 20, 17 @ 12:53 pm
There are plenty of states that pay their legislators much less than Illinois and who are much better run. Public office is not like a typical job. The reward for being in public office is largely rooted in power, prestige, and, hopefully, a sense of giving back to society.

Comment by Pelonski Friday, Jan 20, 17 @ 1:13 pm
Rich….how about a 403k for the legalaters.

Comment by scott aster Friday, Jan 20, 17 @ 2:53 pm
The state of Michigan did this years ago. The difference is the defined benefit plan was replaced with a 401K plan for new members.

Comment by Emily Booth Friday, Jan 20, 17 @ 2:56 pm
Having visited Springfield, it is hard to maintain that the generous pension system has served to assure us of a legislature filled with the best and the brightest. So many legislators are undistinguished and interchangeable cogs. The leaders are notable exceptions.

I would support reduced pension benefits that mirrored what plans are available to those of us in private industry.

Comment by Amen Friday, Jan 20, 17 @ 3:05 pm