Another election, another Illinois Constitution question on the ballot.
In November, for the third consecutive general election, voters are being asked whether to change the state’s 1970 Constitution. This time, it’s a request to increase the number of votes needed to increase pension benefits.
The proposed amendment, backed by powerful House Speaker Michael Madigan, D-Chicago, is aimed at addressing the state’s crushing, unfunded pension debt. It’s at least $83 billion for the five state-run pension systems for teachers, state employees, college teachers, judges and legislators.
If approved, the amendment would add to the section of the Constitution that forbids government from reducing or eliminating workers’ existing retirement benefits.
The following is a brief guide to what voters will be asked to change Nov. 6 and why.
What would this mean if approved?
The amendment, which would take effect with the swearing in of the next General Assembly in January, would require a three-fifths vote by state and local officials, including pension boards, to approve any bill that enhances pension benefits.
In the 118-member House, 71 lawmakers instead of the simple majority of 60 would have to approve such a bill. The number of votes needed in the Senate, which has 59 members, would increase to 36 from 30.
The amendment also increases the number of votes needed to override a governor’s veto, changing it to an even-larger two-thirds majority. It now takes a three-fifths vote to override a veto and a simple majority to accept changes,
How would it get approved?
The proposed amendment must be approved by either 60 percent of the people voting on it, or by a simple majority of those voting in the election in general.
Why is this issue important?
The amendment comes as the state grapples with a huge pension liability caused by decades of generous promises that the state did not come close to fully funding. It also comes in the wake of news reports that exposed public officials who significantly padded their pensions through pension sweetener laws, in several cases for working as little as one day.
The $83 billion shortfall is more than two and a half times the state’s $33.7 billion total budget, 15 percent of which is going toward pensions and benefits. Most of the new revenue generated by the historic 2011 income tax increase – 67 percent on individuals and 46 percent on businesses – has been eaten by the state’s pension obligations.
Analysts say that the $83 billion liability may, in fact, be much greater because of unrealistic rates of return – between 8 percent and 8.5 percent – used in pension fund calculations. An August report by the conservative Illinois Policy Institute puts the total pension and retiree benefits debt for state and local government employees at more than $200 billion.
What will this amendment do to help address the pension crisis?
At the state level, probably very little.
It’s been 10 years since the state passed a bill to sweeten pensions, according to the state Commission on Government Forecasting and Accountability. What’s more, the bills that have passed did so with far more than three-fifths majorities.
The last pension sweetener, a 2002 bill meant as an early retirement incentive, passed with only one “no” vote in both the House and Senate. A 2001 bill that enhanced pension benefits for state highway maintenance workers garnered only two “no” votes in the Senate.
With the state’s finances deep in the red, it is unlikely that any bill to increase pension benefits would survive long, with or without such an amendment. In short, if the amendment is approved, it could be years before it is relevant to capping pension costs.
And given that the General Assembly regularly takes liberties with interpreting the state Constitution – the balanced budget requirement is just one example – the possibility exists that future General Assemblies can find ways around this new limitation if enacted.
What about local government?
The amendment would have no impact on local government boards with four, five, six, eight or 10 members, because a three-fifths majority is mathematically identical to a simple majority. Most local pension boards have four or five members.
In the case of a seven-member school or village board, only one more vote – five instead of four – would be needed to pass a pension sweetener.
Didn’t we just amend the state Constitution?
Yes. Voters in 2010 created a somewhat complicated mechanism to recall the governor in the wake of the impeachment and indictment of disgraced former Gov. Rod Blagojevich. Supporters of recall originally wanted to give voters the power to recall any state elected official except for judges, but that idea ran into significant resistance by lawmakers.
Voters in 2008 defeated a call for a constitutional convention. The state Constitution requires that the voters be asked at least once every 20 years.
Voters since 1970 have approved 11 changes to the state Constitution. Seven proposed amendments, and all three calls for a constitutional convention, have been defeated.
To learn more
Visit Election Central at nwherald.com/election to learn more about the 2012 election, the candidates and the issues.