House Passes Madigan Pension Reform Plan
By Amanda Vinicky, With Additional Reporting from Illinois Public Media
A plan that will leave state employees and teachers with reduced retirement benefits made it out of the Illinois House on Thursday.
The measure potentially paves the way for the pension overhaul that has thus far eluded lawmakers.
It also ignited a face-off between two of the state's top Democrats, with the potential to keep a pension overhaul as elusive as it has ever been.
State workers, teachers and university employees - current and retired - have been fighting to hold on to their promised retirement benefits for years.
There's widespread sentiment that with the House's action, they may be losing that battle.
The measure, narrowly approved by the House on a bipartisan 62-to-51 vote, with six members voting present, was immediately hailed by Gov. Pat Quinn as the "biggest step to date towards restoring fiscal stability in Illinois."
A key negotiator on pensions, State Rep. Elaine Nekritz (D-Northbrook) said she has a "feeling" about it. "I don't have a crystal ball," she said. "I just feel like there's so much consensus around this particular bill, and so I feel like that will be the place where we will end up."
House Speaker Mike Madigan (D-Chicago) made a vow that he will do all he can to get it through the General Assembly.
"I’m committed to the bill; I'm committed to solving the issue," Madigan said. "I've spoken to this publicly. That the state's fiscal problems are so bad that they require radical surgery and this is the first step."
Madigan's legislation is a combination of ideas from a variety of earlier proposals, and it is designed to eliminate Illinois' nearly $100 billion pension debt by the year 2045.
It would significantly reduce the yearly 3 percent, compounded pension boosts retirees receive, instead giving a less generous increase based on a formula that rewards employees with the longest careers working for the state.
Employees would also have to contribute 2 percent more of their paychecks toward their retirement, and the measure hikes the retirement age to 67, for any worker 45 years old or younger.
They are changes decried by labor leaders like the Illinois Federation of Teachers’ President, Dan Montgomery. "Well this is a gut punch to the state's teachers, university workers, firemen, nurses all our public employees," Montgomery said. "And it's unnecessary."
A coalition of unions say they recognize Illinois' underfunded pensions are a problem — an ever-growing one that's eating into money that could instead be going to schools, healthcare, environmental causes, anything.
However, unions say it is unconstitutional, not to mention unfair, to cut workers' promised retirement benefits.
They are working with Senate President John Cullerton — like Madigan, a Democrat — on a separate proposal.
Cullerton's not sharing details of the plan he is working on with unions, but when asked Wednesday about Madigan's plan, he said, "The fact that the president of the Senate and the unions are putting their full weight behind something means something too."
He added, "So if we're able to get our caucus to support a position the unions are for, that would be significant as well.” Union support would be significant — many legislators are wary of angering the politically-active voting bloc."
The only House lawmaker from East Central Illinois to support the measure was Brad Halbrook (R-Charleston.)
Adam Brown (R-Champaign) said the measure unfairly targets downstate Illinois, saying Chicago area lawmakers were careful to exclude judges and teachers from the region in the bill.
“I think when you look at the roll call, you start to realize there are lot of downstate legislators on both sides of the aisle that are going to oppose this measure because it’s not fair to downstate," he said. "It doesn’t affect all the systems, and like a lot of things unfortunately in Illinois government, Chicago isn’t being affected.”
Naomi Jakobsson (D-Urbana) had an excused absence from Thursday’s vote in the House.
A union backlash helped to kill a package similar to Madigan's when it was in the Senate earlier this year, but the Speaker did not appear to think much of whatever it is unions are working on with Cullerton.
"I don't expect that they'll be able to come to an agreement such that people would be prepared to back away from this bill," Cullerton said. "There's two chambers here. And both chambers have to pass the same bill."
Whatever the Senate does, Madigan said it will not save as much money as his plan.
"My expectation is that the Senate will approve this bill," Madigan said.
Speaker Madigan has built a reputation for getting his way during the 43 years he has been a member of the Illinois House.
It may be that with all of the momentum surrounding it, Cullerton will be pressured into giving in and ushering Madigan's plan through the Senate, or the conflict between two of the state's leading Democrats could continue to stand in the way of a pension overhaul.
Either way, it is clear that state workers' pensions rest in the hands of Madigan and Cullerton.
One of the state's other top Democrats — Gov. Pat Quinn — is staying out of the details.
While commending the House vote, he said he respects the role of both chambers.
"The bottom line for me, and I think for the taxpayers and people of Illinois, is to get the job done this month," Quinn said. "We must have — through both houses of the legislature — a final bill, that arrives on my desk, that I will promptly and quickly sign and move our state forward."
Quinn has appeared willing to support just about any plan that appears to be gaining traction. The governor said he just wants something passed that will ease Illinois' pension burden.