By JoAnne von Alroth
SPRINGFIELD, Ill., May 2, The Illinois House of
Representatives in a 62 to 51 vote on Thursday passed a
comprehensive bill aimed at addressing the nation's most under
funded state pension plan, a major step after weeks of
legislative maneuvering had made pensions the dominant political
issue in the financially strapped state.
The bill, introduced only two days ago by the powerful
Democratic House Speaker Michael Madigan, now goes to the state
Senate. That chamber's president is preparing a competing plan
that is viewed as more favorable to the state's public-employee
The Madigan bill, which is designed to eliminate a $96.8
billion funding shortfall over 30 years, relies on changes to
retirement benefits that unions say are a violation of the state
constitution. Union leaders have said they will challenge the
measure in court if it becomes law, and Madigan acknowledged
during floor debate Thursday that implementation likely would
not move forward until courts rule on the constitutional issue.
"In my judgment, this is a critical action that must be
taken now. Must be taken for future budget making. Must be taken
for the fiscal well-being and reputation of the state of
Illinois," Madigan said during a floor debate prior to the
bill's passage. Madigan won the votes of two-thirds of the
Democrats, with 40 of them voting for it and 28 against, while
Republicans split nearly evenly, 22 for and 23 against.
No actuarial analysis of Madigan's measure has yet emerged,
but the speaker said it would fully fund the pension system by
2044 and reduce the state's pension payment by $1.5 billion in
Several law makers acknowledged struggling with how to cast
their vote. "This state is in crisis," said Republican State
Representative Dwight Kay. "What we're doing today is not an
The measure now moves to the state's upper chamber, where
Senate President John Cullerton, a Democrat, is circulating a
union-backed plan. Cullerton has not yet released details of the
new plan, which he described as being "credible and
constitutional" after emerging from a closed-door meeting with
union leaders on Wednesday.
A spokeswoman for Cullerton said the Senate President plans
to discuss both measures with his Democratic caucus on Tuesday.
Still, Madigan was optimistic his plan would pass the Senate.
"We've taken that first step in the House. My expectation is
that the Senate will approve this bill," Madigan told reporters
after the vote.
The state's constitution prohibits any diminishment of
benefits to current and retired workers, and Cullerton has
stated he believes the union plan will meet any constitutional
test. Cullerton previously said he does not believe Madigan's
plan can survive a constitutional challenge.
The Senate's Republican Leader Christine Radogno said "a
significant number" of lawmakers from her caucus were expected
to support Madigan's bill.
Madigan's measure affects four of the state's five pension
funds. The speaker said the bill exempts the judges' pension
fund to eliminate conflicts of interest for judges who would
hear likely legal challenges to the bill should it become law.
The Madigan measure sets a cap on salaries used to determine
pensions, limits cost-of living adjustments on pensions for
future retirees, increases retirement ages and hikes worker
pension contributions. It introduces changes to calculating the
state's annual pension contributions that are designed to come
closer to the actual future cost, and also exempts pension
changes from collective bargaining.
After the vote, a coalition of public labor unions blasted
the bill as being unfair to workers who have paid into their
pension funds while the state has skipped or skimped on its
"On top of that, it is blatantly unconstitutional and thus
saves nothing. It simply exacerbates Illinois' fiscal problems,"
said a statement from We Are One Illinois. The group added that
it was continuing talks with Cullerton.
Illinois lawmakers, who are in the final weeks of their
spring legislative session, are under pressure to deal with the
worst-funded state pension system. Pension payments are
squeezing out funding for core services, while the state's
backlog of overdue bills has topped $9 billion.
Credit rating agencies, meanwhile have downgraded Illinois'
debt rating to the lowest level among states, and a government
watchdog group has reported that pension payments along with
debt service on outstanding pension bonds will amount to almost
25 percent of the state's upcoming general fund budget.
Madigan's bill contains elements similar to those in another
comprehensive bill that failed to pass out of the Senate in