Pension decision yet to made by Legislature

By Ali Combs

Past deadline and without pay, the General Assembly has yet to come to a decision in regard to pension reform.

With Illinois state employees’ salaries frozen and pension plans up in the air, a conference committee has been set up to more efficiently solve the issue, discussing numbers and options as they work their way through each aspect of state pension. State legislators and university leaders have been working constantly to update the state’s pension plan for anyone covered by state pension benefits. Pension reform has been debated for years, but a solution has yet to be reached.

Rep. Bob Pritchard, R-Hinckley, said the current pension plan for state employees was approved in 1995 and requires an increasing amount of pensions to be funded by the state’s budget each year, making Illinois’ contribution to state employees’ pensions

substantially more than most other states.

“We have to do something to reduce the state’s payments each year, because under the plan from 1995 our payments increase each year, and now the state is allocating about 20 percent of the budget to pension,” Pritchard said. “To put that in perspective, most states allocate 2 to 4 percent to pension.”

Steven Cunningham, NIU’s acting executive vice president of business and finance, has worked with other state university leaders for more than a year to create a solution to the “pension crisis.” Cunningham testified with those leaders on behalf of higher education on July 8 in Chicago.

“There’s a conference committee that’s been set up by legislation…,” Cunningham said. “Higher education was asked to testify before them in Chicago and to talk about our Six Step Plan.”

The Six Step Plan was created by Cunningham along with professors and administrators from the University of Illinois and was made with the goal of reducing the state’s

obligations and liabilities in the pension program over time.

The State Universities Retirement System (SURS) hasn’t been directly involved in the pension hearings, but will be affected by whatever reform legislators pass.

“The only thing SURS has been involved in with the pension legislations is providing actuarial studies for each bill that’s been put out, providing financial studies to see how it will affect the budget,” said SURS communication manager Beth Spencer. “We’ve been providing the studies to the House, Senate and, most recently, the conference committee.”

Spencer said SURS does not hold a position on proposed legislation, but the group does work with legislation affecting their funding.

“As a retirement system, we do not endorse or oppose any pension legislation,” Spencer said. “The only legislation we lobby or work on has to do with our funding.”

Pritchard said legislators set up a conference committee to work toward a compromise.

“Once someone retires, it’s not appropriate, fair, ethical, whatever you want to call it, to then take payments away from people,” Pritchard said.

There are no remaining formal deadlines on pension reform, but Quinn said legislators will not receive their salary until a decision is reached.