Lawmakers continue hunt for pension crisis fix
Lawmakers continue hunt for pension crisis fix
Jul. 08, 2013
SPRINGFIELD, Ill. (AP) — A bipartisan panel of Illinois lawmakers reported minor progress Monday in negotiations over the state's nearly $100 billion pension crisis, even as another deadline set by Gov. Pat Quinn was set to lapse without a solution.
In a small step forward, the 10-member group prepared to seek a more comprehensive analysis of a university-backed retirement funding proposal after meeting Monday. Quinn gave the committee a Tuesday deadline, but lawmakers repeatedly said they wouldn't meet it.
"We're just brainstorming now," state Rep. Darlene Senger, a Naperville Republican said. "It's really all about the numbers at this point."
Lawmakers moved to form the committee — with members appointed by legislative leaders in each chamber — after a compromise couldn't be reached last month. The panel had invited Quinn to speak at Monday's hearing, their third overall and the first in Springfield. But Quinn declined, saying committee members know where he stands and that his budget office will speak on his behalf.
Presenting were representatives from three of the state's retirement systems and the governor's budget director, Jerry Stermer, who was roundly criticized by committee members for pushing what they considered to be an unreasonable deadline.
Committee chair Kwame Raoul reminded Stermer it takes time to craft legislation and called for the governor to "cast politics aside and allow the conference committee to do the work."
"I share the sense of urgency, but I appreciate the conversations the committee has had under challenging circumstances," Raoul, a Chicago Democrat, said. "We've worked well together in a bipartisan, bicameral manner. I want to make clear, I'm not an actuary. The legislature cannot do anything that has not been appropriately scored," Raoul said.
State Rep. Mike Fortner, a West Chicago Republican, went over his own separate proposal that would require bond payments to be redirected to the state's pension fund once bonds mature. The plan also would increase employee contributions and cap pension benefits.
State Rep. Elaine Nekritz, a leading pension negotiator, said following the meeting the committee likely will send a proposal supported by university presidents off for an analysis of what it would ultimately cost the state. That number crunching process could take several weeks.
The plan, advanced by the Institute of Government and Public Affairs at the University of Illinois, requires workers to pay more toward their retirement and links cost-of-living increases to inflation. It also shifts the employer pension contribution — currently paid by the state — to the schools over time, and guarantees the state will make its full annual payment to eliminate the pension debt.
Some lawmakers see the proposal as a possible framework to build on in order to move past a divide over dueling pension plans supported by House Speaker Michael Madigan and Senate President John Cullerton, both Chicago Democrats. The House-backed plan, which would come with significant cost savings, imposes across-the-board changes to pension recipients and raises the retirement age. The Senate plan would give workers a choice in the benefits they'd receive upon retirement, and supporters say it would have a better chance of passing constitutional muster.
"Let's look at the savings in the (university-supported) proposal and see where we land," Nekritz, a Northbrook Democrat, said.
Illinois' unfunded pension liability is hovering around $100 billion due largely to lawmakers voting over decades to either skip or short the state's pension payment. Making that full payment now costs the state more than $6 billion each year, an amount that takes money away from other areas, such as schools and public safety.
The pension mess "As you know I'm an optimist but we've been working on this for two years and also has prompted the three major credit-rating agencies to lower Illinois' credit rating to the lowest of any state in the nation.
After signing legislation to combat gang violence in Chicago Monday, Quinn again called on members of the Legislature to put a pension reform bill on his desk.
"They've had one excuse after another for the last two years," Quinn said. "If they don't do their job by tomorrow, there'll be consequences."
Stermer expressed concerns about the pace of work being done by the committee, although he didn't propose any alternative solutions or spell out what "consequences" Quinn was referring to if the deadline passes.
"As you know I'm an optimist but we've been working on this for two years and haven't seen (progress)," he said. "The proof is in the pudding so when the bill is on the governor's desk I'll be able to feel comfortable."