Pension fight just keeps going

Pension fight just keeps going

Here, there and everywhere — public pension woes are a fact of life in Illinois.

Gov. Pat Quinn signed public pension legislation Monday that cut benefits and raised retirement ages.

If that seems like a replay of old news, like his earlier action signing similar legislation affecting state employees and teachers, it's because the theme is familiar.

The latest pension bill Quinn signed is aimed at municipal employees in Chicago. But the legislation is hardly a fix for the Windy City's serious public pension woes — not even addressing similar issues involving city police officers or firefighters.

Then there is the matter of Cook County public employees. County board Chairwoman Toni Preckwinkle has been pushing, so far unsuccessfully, for legislation modifying benefits. At the same time, downstate mayors have been doing the same thing for their public pension systems.

Will they get the help from the General Assembly? If so, will pension reform legislation survive the inevitable legal challenges?

Even as Chicago Mayor Rahm Emanuel got the help he sought and other elected officials press for legislation affecting their pensions systems, Illinois courts are in the early stages of reviewing the pension bill affecting state employees and teachers. If that legislation ultimately is found unconstitutional — and that may well happen — legislators will face new and even more difficult pension problems to resolve.

Certainly not all, but many public pension systems in Illinois either are underfunded, require huge contributions to sustain or have some combination of those two problems. Funding them will require shortchanging other vital services. For instance, Chicago owes a $600 million contribution to police and fire pension systems by 2016. Coming up with the money will require tax increases, service cuts, borrowing or all three.

Our politicians, naturally, are looking for the safest way out of this mess, and their stands are not exactly courageous.

The pension bill Quinn signed allows Chicago's elected officials to increase property taxes as a means of putting more money into the city's underfunded pension. But Mayor Emanuel faces re-election next year, so he quickly announced after Quinn signed his bill that "property taxes, as it relates to this agreement, are off for year one."

Although he was the chief lobbyist for the legislation, Emanuel is, obviously for political reasons, temporarily ignoring a crucial tool his legislation provides.

Meanwhile, Quinn, who signed the bill, won't object to delaying property tax increases. If Emanuel delays the increases until next year, Quinn won't have to face charges from Republican gubernatorial opponent Bruce Rauner that he is partly responsible for higher property taxes in the city.

Obviously, Emanuel, Quinn and members of the Legislature are in a tough spot. The financial woes of public pension systems in Illinois go back many years. Early on, these problems were easy to ignore, and they were ignored. Now they're becoming impossible to ignore, and the battle — legal, legislative, electoral — grows ever more acrimonious.

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Skepticity wrote on June 11, 2014 at 11:06 am

It is not the pension funds that have the woes.  It is the financial woes of the units of government who did not fund the pensions as required and now owe money they don't have. 

It is the various units of government whose elected officials made contractual commitments and then violated their fiduciary responsibility and failed to appropriate the funds needed to fulfill their obligations. 

Those units of government are on the hook for the failures to fund, and now these units of government are experiencing the woes.  They need to raise the funds or go bankrupt. 

The State of Illinois does not have the option of bankruptcy, it just needs to fund the pensions, and stop trying to steal what has already been earned. 

All the rationalizing in the world cannot excuse the manipulative attempts to welsh on the contractual obligations that the governments committed to fulfilling and then did not fund. 

Blaming employees who worked in good faith under contracts is pretty damned low.  The elected officials made contractual agreements, and governments are responsible to pay the money owed to the pension funds.  That means that the public owes the money.

To be crystal clear, the issue is NOT politicians making promises. 

It is elected officials of government making contractual commitments. 

 

EdRyan wrote on June 11, 2014 at 11:06 am

Good luck with that.  If you're the last person left in Illinois, please turn out the lights.