The complications of pension reform

Oak Park lawmakers discuss effort to fix broken system

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By La Risa Lynch

It's complicated.

That's how Oak Park's lawmakers describe the tangled effort to revamp the state's pension system.

State lawmakers are currently trying to hammer out a reform bill. At an Oak Park forum Oct 9 with area elected officials, the phrase "it's complicated" was often repeated.

"It is perhaps the most complicated issue I've dealt with in my time in the legislature," state Sen. Don Harmon (39th) said. "The day I was born, pensions were about underfunded as they are today."

That sentiment was echoed by fellow lawmakers, state representatives LaShawn Ford (8th) and Camille Lilly (78th), and state Sen. Kimberly Lightford (4th), who attended the legislative forum hosted by Julian Middle School, 416 S. Ridgeland.

One sticking point for state lawmakers is the constitutionality of reducing pension benefits for state employees.

A proposed Senate bill would give employees the option of either giving up cost of living adjustments (COLA) or forgoing health insurance. Legislation in the House offers no choice while unilaterally increasing the retirement age. COLA would be suspended under this bill, which also limits salaries that are eligible for pension benefits — concessions that supporters say could save $150 billion.

The stalemate, however, exists because both chambers passed entirely different reform approaches, Harmon noted.

Normally, a House and Senate conference committee works out a final bill, with bits and pieces taken from both chamber's bills. But because the two pension reform bills offer entirely different solutions in solving the state's nearly $1 billion shortfall in five government pension systems, Harmon said the traditional route just couldn't work.

"They were just fundamentally different models and legitimately could not be reconciled. Neither one of those are very viable options right now," Harmon said.

Ford agreed, noting that, in his view, both bills are unconstitutional because both reduce benefits.

"I don't know how I can support a measure that reduces the benefits during this time, especially when you have inflation and the cost of living going up," he said.

Lightford acknowledged the difficulty in tacking reform, calling it "one of the most complicated areas, because we are talking about people's livelihood."

Concerning the Senate bill, Lightford believes it is constitutional because it offers a choice, "on different ways to pretty much stab yourself in the foot. You can stab it from the side or you can go straight up the middle."

Tinkering with benefits that people count on after retirement is challenging, Lightford said. And she called it "totally wrong" to diminish or remove a retiree's healthcare benefits.

"[People] should not at this stage in their life look up and say, 'I'm 65, I'm 70 and half my income has been cut.' Where else are they going to go to subsidize their income?"

Concerning the reform package, Lightford is on the fence, maintaining she's not yet ready to vote on the bill. She would support a bill, however, that's backed by the teacher retirement system, or TRS, since they have been at the negotiating table.

"I'm not a yes or no, but I need to see the final product, and see the effects of that final product," she said.

About 100 people attended last Wednesday's forum, sponsored by CLAIM, a legislative ad hoc committee created by Oak Park elementary school District 97. CLAIM specifically deals with the state legislature concerning educational issues.

But state lawmakers have faced voter criticism for dragging their feet in overhauling its pension obligations. Harmon, though, stressed it's important to get this issue right. Gov. Pat Quinn hoped to light a fire under the General Assembly by attempting to withhold lawmakers' paychecks in order to get a deal done, but a judge overruled that action.

"It does not need to be done in any particular time other than soon," Harmon said of reform.

Movement could come from a proposal by a bipartisan committee of lawmakers from both chambers. The Democratic-Republican committee plan would refine COLA, which would float, or adjust, with inflation, reportedly saving $140 billion. Though there's some rankling over the proposed cost-savings — some lawmakers want savings of $150 billion — Harmon, who thinks $140 billion is a good compromise, is hopeful the plan can bring both chambers together.

"I don't know why they're still complaining so much, but I think we need to move on this," he said.

Lilly is encouraged by the committee's transparency — teachers, retirees and those impacted by pension reform have been able to offer their input. But even with that input, everyone will not get what they want in a final bill, Lilly noted. Sill, the dialogue will make compromise more palatable, she said, noting the 60 percent of the state's budget goes to funding pension obligations.

And the pension debacle, according to Harmon, makes funding education, healthcare and human services more difficult.

"We need to create the budget headroom so we aren't cutting education funding year after year," he said. "It's a shame. When we have to cut, our hands are tied…that means the people who really need [services] get the least."

Next week, the lawmakers discuss school funding.

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OPRF Achievement  

Posted: October 19th, 2013 7:25 AM

If anyone ever had ANY doubt about Harmon, it is over. The guy is like a dead fish. Cold and clammy. He also carries the water for his mentor Cullerton -- and his BFF Madigan. Time for this one to be tossed over board!

Done from Oak Park  

Posted: October 16th, 2013 2:57 PM

"It does not need to be done in any particular time other than soon," Harmon said of reform. And "soon" has taken almost a year and it will not be resolved anytime "soon". Elections are coming up and none of our "representatives" want to lose their jobs over this issue, even though every one of them should. Did anyone ask about the state's responsibility in this fisaco by not funding the pensions for several years? I'd like to see Madigan's lackey - I mean Harmon's, sorry - response to that.


Posted: October 16th, 2013 2:12 PM

Pathetic! Elections are coming and the voters will more then likely put these folks back in office! You only have yourself to blame.

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