Increased Contributions to Illinois Pension System
SPRINGFIELD, Ill. (IRN/KMOX) – It has been one of the most contentious issues in Springfield for years – how does the state pay down its unfunded pension liability? Lawmakers Tuesday night sent a pension overhaul to the House floor for a vote.
The state is $85 billion behind in funding its pension system. This measure would increase contribution requirements from current employees receiving “Tier I” benefits from 9 percent of their paychecks to 13, and could rise only as high as 15 percent after a three-year adjustment period. Previous legislation had no limits on how much that contribution level could rise.
Future state employees wouldn’t be eligible for this package, and would pay 6 percent for lesser benefits or opt for a 401(k)-style plan. State Rep. Darlene Senger (R-Naperville) says the plan saves money, and is fed up with hearing about how it’s being rushed.
“I haven’t heard anyone else come in and save a dollar here,” she says. “Again, we could do this until we’re blue in the face. We sat and worked with a lot of you this summer but no one brought ideas to the table. So I’m voting yes.”
Opponents pointed to what they say is a big flaw in the bill: it doesn’t require the state to make its actuarially required payment every year. Henry Bayer, executive director of AFSCME Council 31, says that’s a key component of paying down the $85 billion liability. “There’s nothing in this law that requires the state to make the actuarially required contribution,” says Bayer. “If there is, why don’t we state it?”
The measure’s sponsor, House Minority Leader Tom Cross (R-Oswego) responded that the state will gradually pay down the unfunded liability from its general revenue fund.
The measure passed 5-4 out of committee.
IRN/KMOX © Copyright 2011