SPRINGFIELD – 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 have said they won’t meet it
“We’re just brainstorming now,” said state Rep. Darlene Senger, a Naperville Republican. “It’s really all about the numbers at this point.”
Lawmakers moved to form the 10-member 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, its third overall and the first in Springfield. But 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 – the Teachers’ Retirement System, State Universities Retirement System and State Retirement System – and the governor’s budget director, Jerry Stermer.
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 after 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 framework to build on 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 also has prompted the three major credit-rating agencies to lower Illinois’ credit rating to the lowest of any state in the nation.