Possible Break In Stalemate Over Pension Reform
CHICAGO (CBS) -- There is a possible break in the stalemate over pension reform in Illinois.
Lawmakers may have reached a temporary agreement on a key roadblock toward settling the state's pension crisis. The issue centers on shifting suburban and downstate teachers' pension costs from the state to local school districts.
House Democrats had been demanding that be part of any pension deal. Republicans were opposed.
CBS 2 Chief Correspondent Jay Levine reports that Gov. Pat Quinn and House Speaker Mike Madigan may have worked out a way around that issue.
The solution is to defer action on shifting teacher pensions and try to pass a more limited reform measure during the lame duck session. Lawmakers would then tackle teacher pensions when the new General Assembly is sworn in.
No further details were immediately available, but Quinn is meeting with Republican officials in DuPage County on Friday to discuss the issue.
The leaders and Gov. Quinn will also meet tomorrow to work on an agreement.
Moody's Investors Service has warned the state's credit rating could be downgraded again if there is no movement soon on the pension situation.
The state has $96 billion in unfunded pension debt. State employee unions have offered to chip in more for their pensions, if the state raises new revenue to guarantee its own pension obligations from now on.
For years, the state has delayed or short-changed its pension obligations to use the money for other expenses.
A group of at least 20 lawmakers has pitched a plan they estimated would save the state $2 billion on pension costs, and reduce the pension debt by nearly $30 billion next year.
The measure would reduce cost-of-living increases for state workers and retirees, and require employees to contribute more to their pensions. It would also shift the burden for paying the employer's share of teacher pensions from the state to local school districts, and set a higher retirement age for younger employees.
Lawmakers said their plan would make sure the state's pension plans are fully funded within 30 years.
