UPDATE 2-Illinois lawmakers pass long-awaited pension reform

Tue Dec 3, 2013 6:50pm EST

SPRINGFIELD, Illinois Dec 3 (Reuters) - Illinois lawmakers on Tuesday passed a landmark pension reform bill, moving to address the state's crumbling finances in the face of strong public labor union opposition to the bill, which among other measures raises retirement ages.

The bill, passed in a special session, addresses problems that have built up over decades in the nation's worst-funded state pension system. Other changes include reducing and suspending cost-of-living increases and limiting the salaries on which pensions are based.

Championed by Democratic and Republican legislative leaders, the bill passed the Senate in a 30-24 vote and the House in a 62-53 vote after lengthy and at times emotional debate. It now heads to Governor Pat Quinn, who supports it.

"This bill will ensure retirement security for those who have faithfully contributed to the pension systems, end the squeeze on critical education and healthcare services, and support economic growth," the Democratic governor said in a statement.

With the state's finances buckling under a $100 billion unfunded pension liability, Democratic House Speaker Michael Madigan and others said the bill would save the state about $160 billion over 30 years and immediately reduce the unfunded liability by at least 20 percent.

Labor unions called on Quinn to veto the "unfair, unconstitutional bill. If he doesn't, our union coalition will have no choice but to seek to uphold the Illinois Constitution and protect workers' life savings through legal action," the union group We Are One Illinois said in a statement.

The measure will affect nearly half a million current and retired public sector union workers, according to a union spokesman. Unions argue the law violates a state constitutional prohibition against diminishing pension benefits.

Senate President John Cullerton, a Democrat, said he welcomes any court challenges to the constitutionality of the reform measures in the bill.

The affirmative vote came after a failed effort in the legislature's spring session, a summer of wrangling by a special legislative committee, and weeks of closed-door talks among the leaders. It also followed years of discussion and study, previous reform measures that provided limited improvements or failed to pass, and numerous downgrades of the state's credit ratings.

Some lawmakers during the floor debates worried that Illinois could be in for another round of credit downgrades should the bill fail. Its passage could brighten the prospects for a $350 million bond sale Illinois has planned for next week.

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Comments (4)
ejhickey wrote:
after looking at the provisions of this bill , i would say the influence of the Tea Party is stronger than ever. it would not surprise me to find out that some democratic legislators are closet Tea Party members

Dec 03, 2013 4:25pm EST  --  Report as abuse
peanut61 wrote:
this is the thing, the state employees were and are not asking for extra things. they willingly gave up step raises to help the state with their budget crisis and now they are trying not to pay them back as they said they would. Just give the workers back what you owe them. This is just theft and it is unconstitutional. Shame on the people who voted for it. The state is just unwilling to quit spending like drunken sailors and is looking for someone else to pay for it. no one is going to retire wealthy working for the state and it is sad when they gave up at least 2 raises to help the state government and now they are not living up to their end of the deal. Well, we will all stand before a righteous and holy God and have to explain how we lived our lives and why we did the things we did.

Dec 03, 2013 10:38pm EST  --  Report as abuse
Deanoj wrote:
Illinois is completely owned by Democrats, and the Tea Party has nothing to do with what happened today. Nice try at deflecting. The responsibility and blame is completely on them. Period.

Dec 04, 2013 12:09am EST  --  Report as abuse
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