By Dan Berman
The leaders of the Illinois General Assembly are working on a deal to end the state’s pension crisis
after months of political wrangling have failed to produce a solution.
Word of a deal to close the state pension fund’s $100 billion unfunded liabilities gap came from Senate Minority Leader Christine Radogno, R-Lemont, during a radio interview with Illinois Public Radio.
Radogno said that under the framework being discussed, employees would pay less into the fund (about a 1 percent reduction), but many would receive smaller payouts when they retired. The reductions would be determined by a complicated formula that is not finalized. Annual automatic cost of living adjustments would be eliminated.
Radogno, who said making a deal with three other lawmakers that occurred during a special panel that failed to achieve a compromise had reduced friction in the Assembly, added that the possible deal would pay larger benefits to the longest-tenured state workers.
The state’s public pension systems are regarded as the most under funded in the nation. The main cause of the shortfall is that lawmakers failed to make annual payments to the fund. This year alone, $6 billion in payments are due.
The other Assembly leaders working with Radogno are Senate President John Cullerton, D-Chicago, House Speaker Michael Madigan, D-Chicago, and House Minority Leader Jim Durkin, R-Western Springs.
The legislature has been pressured by the governor, the mayor of Chicago and others to make a deal. In September, Gov. Pat Quinn ordered that the pay of legislators be withheld until they reached a pension deal. A judge ruled that move unconstitutional.
Originally published on BenefitsPro.com