Madigan: Public pension boosts should require more votes
Friday, April 13, 2012
SPRINGFIELD —With Illinois facing strangling debt from the money it owes to retirement funds, a top Democrat is seeking to amend the state Constitution to make it more difficult for legislators to boost public-employee pensions in the future.
The amendment House Speaker Michael Madigan proposed this week would require three-fifths votes in the House and Senate to enhance retirement benefits for public employees and similar tallies by city councils or school boards to sweeten perks for certain employees. If lawmakers and Gov. Pat Quinn approve, voters would decide in November whether to make it part of the Constitution.
Illinois owes about $80 billion to its five public-employee pension systems because of decades of underfunding. Madigan has pushed several recent measures to ease the financial burden, such as reducing benefits for new employees.
The latest proposal is aimed at dozens of bills introduced over the years to sweeten government workers' pensions. The piecemeal changes add up. The rub is that most of those proposals get nearly unanimous support, anyway.
In the Teachers Retirement System alone, legislative changes have added more than $2 billion to the state's unfunded liability since 1996, or 6 percent of the total growth in the state debt to the system, according to TRS figures.
The largest state-employees' union, the American Federation of State, County and Municipal Employees, opposes Madigan's plan, while the Illinois Municipal League views it "very favorably."
House Minority Leader Tom Cross, R-Oswego, said he supported the measure but echoed AFSCME's repeated concerns about the $80 billion debt.
"Our real focus needs to be on how to reduce the unfunded liability," Cross said.
Madigan, a Chicago Democrat, introduced a similar amendment last spring. This revision answers local government worries that it would require extraordinary majority votes to approve budgets or other financial measures, spokesman Steve Brown said.
"This is not designed to complicate the day-to-day operations of local governments, school boards, or state government for that matter," Brown said. "But it is designed to make officials think a little more seriously when they consider benefit changes to the pension systems."
A committee appointed by Quinn expects to deliver other suggested fixes next week.
Madigan's proposal is scheduled for a committee hearing Tuesday. The Legislature would have to OK it by May 6 to put the question before voters in the November election.
"It's a critical component of an overall solution to rising pension costs," said Joe McCoy, legislative director for the Municipal League.
AFSCME said the idea doesn't fix a problem with the reduced pensions for new workers, which experts have said might run afoul of the federal Social Security exemption and result in penalties.
Local governments would need three-fifths votes in limited circumstances involving pensions — salary increases themselves would not be included. AFSCME spokesman Anders Lindall said proposed restrictions on local governments might improperly nix negotiated employee-contract agreements.
The bill is HJRCA49.