A group of civic organizations is calling on the legislature to act on one specific pension reform plan. The Civic Federation is backing House Bill 6258, which focuses on reducing pension costs while also being sensitive to lower-paid employees and those close to retirement. Laurence Msall, president of the Civic Federation, says H.B. 6258 is the best vehicle to put pension reform in play.“We believe it has the greatest potential to stabilize the state’s pension system and the finances,” Msall said. He says lawmakers must act quickly in order to avoid another bond rating agency downgrade.
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The bill would require public-sector workers to work until an older retirement age and pay more into the pension funds, and it would reduce cost-of-living adjustments on pension amounts greater than $25,000 per year.
Some lawmakers are concerned about the constitutionality of H.B. 6258, but Andy Shaw, president of the Better Government Association, believes any bill dealing with the public pension system would likely be challenged in court, so lawmakers should act on something and let the courts sort it out. “The legislature can pass several bills if they like…They can send three bills off to the courts and let the courts decide if one of them is constitutional,” Shaw said. “Laurence [Msall and the Civic Federation are] endorsing this bill. The BGA is not endorsing this bill specifically but we believe this bill and any other bill that starts the reform process should move forward and most importantly, let the legislature make the decision. Don’t hold these bills hostage. Get it out there, discuss it, debate it, amend it if necessary and vote it up or down. That’s what the taxpayers deserve, a chance to have a vote up or down so we can get it off to court and find out what’s legal.”
Legislative leaders have been putting pressure on the governor to present a specific plan, but he has yet to back a specific plan. Shaw says it’s time for the governor to act. “Pat Quinn either has to propose a bill of his own or get behind this bill, otherwise no one can claim that he has a real interest in pension reform,” Shaw said. “He’s got to get out there on behalf of something. This is the best vehicle that exists now. If he has a better one, put it on the table and consider it. Otherwise, let’s consider this one now.”
As for other legislation taking the spotlight in recent weeks, like a proposed ban on military style weapons and their large capacity magazines and the proposed legalization of same sex marriage, Msall and others are hoping lawmakers don’t forget to tackle the elephant in the room, public pension reform.
H.B. 6258 purported benefits:
? Reduce the state’s unfunded pension liability by an estimated $28 billion
? Reduce the state’s required pension contributions in Fiscal Year 2014 by $1.8 billion
? Achieve 100 percent funding of pension system by 2043
? Create a legally enforceable right to compel the state and other employees to make required contributions (Contributions enforceable through court action)
? Gradually shift normal cost of pension benefits to employers, giving school districts, community colleges and universities time to build new costs into their budgets