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Pension proposal to come up in committee

Published: Monday, Jan. 7, 2013 1:15 a.m. CDT • Updated: Monday, Jan. 7, 2013 11:08 a.m. CDT

SPRINGFIELD (AP) — An attempt at solving Illinois' worst-in-the-nation pension problem faces its first test Monday as a House committee considers a plan calling for more employee contributions and freezing cost-of-living increases for retirees.

The proposal — which has the backing of Gov. Pat Quinn and House Minority Leader Tom Cross — emerged Sunday as lawmakers entered the final stretch of the lame-duck session.

"We've been working together, we certainly want to get something moving," said Sara Wojcicki Jimenez, spokeswoman for Cross, R-Oswego. "But like anything, this is pretty huge magnitude. We've got to make sure that we have a good chance to take a look at it."

The amended measure was scheduled to get a committee hearing Monday, said Rep. Elaine Nekritz, a Northbrook Democrat who has been at the heart of pension talks.

"We think the bill will get out of committee," she said late Sunday. "It's been my goal throughout this entire process to not place blame, whether it's blame as to how we got here, blame as to why this isn't getting done."

But Nekritz and other backers were coy about the chances on the floor for the measure during the final days of the current General Assembly, which features lame-duck lawmakers who are not returning and can vote without fearing voter backlash.

Nonetheless, Nekritz said the issue has "consensus among the leaders of the House."

Quinn — who had set a Wednesday deadline for pension legislation — had been working with Nekritz on the bill, said Quinn's spokeswoman, Brooke Anderson.

"We're encouraged by the momentum to fix a problem that urgently needs to be fixed," she said.

Word of the tentative agreement emerged Sunday when the House reconvened for the final days of the current General Assembly, but made little headway on other issues, including an assault weapons ban.

The amended pension bill, sponsored by Nekritz, would not award annual cost-of-living increases until the age of 67 and would increase employee contributions by 2 percent of salary, spread over two years. Once cost-of-living increases took effect at 67, they would be applied only to the first $25,000 of a retiree's pension.

Finally, it would require the state to fully fund its portion of pensions under threat of legal action by the accounts' administrators.

That's key to hundreds of thousands of workers and retirees who have been forced to pay their share over the years. Decades of inattention by lawmakers and governors to save up for state workers' retirement plans, including years where they skipped payments, led to the huge shortfall.

Quinn says the deficit grows by $17 million a day. The piling debt has hurt the state's credit rating, limiting its ability to borrow. It has also eaten up more and more money for education and other public services.

Various plans for bumped-up contributions and less-generous benefits for current employees, raising the retirement age and reducing cost-of-living adjustments for retirees, have been floated in the past year. But the "cost shift" of the employer portion of teachers' pensions from the state to school districts has stymied attention.

Democratic Senate President John Cullerton has said he wants lawmakers to pass a more modest alternative that the Senate adopted last spring. That proposal affects only a portion of the workers and retirees but would be a starting point for expansion, and Cullerton is concerned that more ambitious efforts could be unconstitutional.

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