Wednesday, June 06, 2012

Quinn wants pension reform in June

By Jamey Dunn

Gov. Pat Quinn said today that he would like to see pension reform legislation approved by the end of June.

“We have to sign a budget by the end of the month. I’d like to also sign pension reform," Quinn said today at a Chicago news conference. 

During the regularly scheduled legislative session, which ended Thursday, lawmakers were unable to agree on a plan that could find the needed support to pass in both chambers. Quinn and the four legislative leaders vowed to work out a proposal that they think can pass and return to Springfield over the summer. Quinn said today that he and the leaders are using the next few weeks to gather information. "We need actuaries and accountants and all kinds of experts to help us out here."

He said the group is focusing in on the concept of a cost shift, which would require school districts, universities and community colleges to take over all of some of the retirement costs of their employees. He said they are getting information from local districts, such as budget information and how much they currently pay toward employee retirement cots, to determine how different ideas might affect districts. “People can have different opinions, but you can’t have a different set of facts. We want to have a common set of facts.”

Republicans opposed the cost shift proposed by Democrats, which would have required school districts to eventually take on all future retirement costs for their employees. They argued that such a plan would result in property tax increases across the state. House Minority Leader Tom Cross pitched the idea of having schools pick up the retirement costs associated with any raises given to employees in their final years on the job. He did not call his legislation for a floor vote because he said it did not have the support to pass.

Senate President John Cullerton called for passing a plan that makes changes to retirement benefits for state employees and the General Assembly. The Senate has already approved such legislation, and the plan is free from the controversy of the cost shift. Cullerton said lawmakers should go ahead and pass what they can agree on now, and then revisit changes to the retirement systems for teachers and university employees when a compromise can be reached. "If we pass a bill in a bipartisan fashion that deals with 25 percent of [the pension shortfall] as soon as possible, it would go a long way toward showing the [bond] rating agencies that we are getting serious about this," Cullerton told the Springfield State Journal-Register.

But Quinn seemed unhappy with a piecemeal approach. “We’ve got a lot of ideas out there. I think it’s very important to understand that this issue cannot be delayed. It cannot be a partial solution,” he said today. Quinn said his office received a memo from the bond rating agency Standard & Poor’s that said the group was reviewing the state’s newly passed budget and watching to see what action is taken on pension reform. Rating agencies have threatened to downgrade the state’s credit rating if changes to the pension system are not made. A downgrade could mean that it would cost the state more to borrow.

Quinn also predicted that any proposal that does not ask schools to take on some of the responsibility for retirement costs could not pass in the General Assembly. “We can do this. We’re very close. We’ve agreed on many principles. We have one principle that we agree on, but we have to agree on the implementation of that principle. And we can do this if we work together.” He said that he and the legislative leaders plan to meet again in two weeks.


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