— Efforts to develop a plan for comprehensive reform of public employee pensions hit a snag Monday as opposition intensified over a provision to shift retirement costs for suburban and Downstate teachers onto local school districts.
House Speaker Michael Madigan, D-Chicago, has said the cost shift from state taxpayers to local school property taxpayers should be part of any proposal to curb unsustainable costs for a state worker pension system that is the most underfunded in the nation. A pension bill could come up for a vote as soon as Tuesday as lawmakers scramble to finish their work before a Thursday night deadline.
But even a top member of Madigan's Democratic leadership team said pushing costs on overburdened suburban property taxpayers is "craziness."
"Looking back in hindsight, maybe it was a mistake" for the state to pick up suburban teacher retirement costs, said Deputy Majority Leader Lou Lang of Skokie. "But we're here today. And property taxpayers can't pay any more. The value of their property's going down, and their taxes are going up."
Some Republicans privately questioned whether Madigan's insistence of the cost shift in a pension-reform plan was a political poison pill, allowing campaigning Democrats to contend it was GOP lawmakers' opposition that doomed efforts to rein in retirement spending.
But Lang's opposition signaled that in a year when all 177 House and Senate seats are up for election, many suburban Democratic lawmakers are fearful of appearing to encourage an increase in local school property taxes or a cut in educational services to pay for teacher pensions.
"If there's a huge cost shift, it makes it harder for suburban Democrats and Republicans in Cook and the collars to even consider those," Lang said.
Chicago property taxpayers pay for retirement benefits in Chicago Public Schools, a point Madigan repeatedly has stressed. Suburban and downstate teachers are in a retirement fund bolstered by state funding.
Opponents of moving retirement costs onto local districts have argued that Chicago gets a disproportionate share of state funds compared with suburban schools, which are funded almost exclusively by local property taxes.
The cost shift, which also would include community colleges and public universities, has lawmakers questioning which is more important — pension reform or potential property tax hikes. For public universities, the pension costs would have to be covered by tuition or other state funds.
"Each of us has to weigh the larger issues of pension reform against putting more costs onto local school districts," said Rep. Jim Durkin, R-Western Springs. "We have to be very careful what we do with this. This may be one of the toughest votes that anybody casts down here."
Under plans being discussed, the cost shift would be phased in for about 15 years beginning in summer 2013, with the biggest shift taking place in the first six years, said Rep. Elaine Nekritz, D-Northbrook. Some lawmakers have pushed for the shift to try to make local schools stop bumping up pensions for retirees.
Senate Republicans also said there were attempts to make local school districts — and local taxpayers — make up for any increase in the unfunded liability of the teachers' retirement system in the future, even if it was caused by a lower return on investments.
Meeting on Memorial Day as the adjournment deadline looms, the House approved legislation that would allow Illinois' new Internet lottery operations to offer the big-prize Powerball game along with the already available Mega Millions game. The measure returns to the Senate.
Taking a cue from the holiday, the House also approved legislation that would allow veterans to have their status denoted on driver's licenses or ID cards to make it easier to obtain state benefits. Veterans now have to show discharge papers or other proof of service, said sponsoring Rep. Mike Fortner, R-West Chicago.
Meanwhile, a House panel advanced a compromise measure backed by the Illinois State Police and the Illinois State Rifle Association aimed at correcting problems in the state's firearms owner's identification card program. Auditor General William Holland recently issued a report showing that only three of the state's 102 county circuit clerks were reporting judicial findings of mental illness to the state police to make someone ineligible for a FOID card or have their existing FOID card revoked. Circuit clerks had said judges never directed them to send the information to the state, something that would be required under the latest proposal.Copyright © 2015, CT Now