As the Illinois Legislature convenes today to discuss the state’s $97 billion pension crisis, a glimmer of hope has emerged.
According to an Associated Press story Tuesday, a bipartisan committee might be formed to negotiate a compromise between House and Senate pension reform bills that were previously approved but are markedly different.
We believe Gov. Pat Quinn, House Speaker Michael Madigan, and Senate President John Cullerton, all Chicago Democrats, may finally be on the right track.
By agreeing to allow Republicans a say, albeit a small one, in the process, a more well-rounded piece of legislation could emerge.
After today’s special session of the House and Senate, the governor apparently will reconvene the Legislature for an additional session in July. The intervening time would give the 10-person committee (expected to be six Democrats, four Republicans) an opportunity to do its work.
The committee obviously needs to find a way to put the state on a path toward reducing its $97 billion debt to the pension system, which was created, in no small manner, by actions of past governors and legislatures when the state’s pension payments were skipped or shorted.
As suggested by Sauk Valley Media’s “Pension Perks” series earlier this month, there is also room for improvement regarding pension payouts that some people would call extravagant.
The series described one local school board’s practice of allowing 20 percent pay increases for its outgoing superintendent in the final years of his contract before retirement. His salary rose by $100,000 in the final 4 years of employment, to $256,000. That allowed the retiring superintendent to draw a much larger pension – nearly $160,000 a year.
Other school boards utilize a more modest pension-spiking formula: 6 percent salary hikes during the final 4 years before an educator retires.
But the effect is the same: larger annual pensions being doled out at a time when the pension system is perilously underfunded – to the tune of $97 billion!
SVM’s “Pension Perks” series told the tale of another local school superintendent who retired, began to collect his $84,000-a-year pension, and then worked part time at his old job, where he earned $60,000 a year.
Some people call that double-dipping.
Plenty of other examples exist in recent years of how the financially-troubled pension system seems to have been manipulated to boost payouts.
This occurred as the economy suffered through the Great Recession, and regular taxpayers – those who don’t work for the government – endured salary freezes, salary cuts, job losses, and more.
The gulf between the state’s pension system and economic reality became wider, even as current pensioners call for protection for their 3 percent annual pension increases.
We wish good luck to the bipartisan pension committee, if indeed it becomes a reality. Among its top priorities should be a very, very close look at pension perks.