In the 1860s, lawyer Gideon Tucker wrote that, “No man’s life, liberty or property are safe while the Legislature is in session.”
What did he know? Tucker was from New York, not Illinois.
So it is that, as the days get shorter, the weather colder and the state legislature has adjourned, House and Senate members still are playing with a fire that could leave taxpayers with first-degree burns.
Another state pension boondoggle is in the offing. Naturally, it’s billed as “reform.” But driving our debt-laden state even deeper into red ink hardly qualifies as a positive development.
The canaries in the coal mine have issued their warnings.
A representative from the Center for Pension Integrity describes the legislation — S.B. 1937 — as “one of the most harmful pieces of legislation for state finances in history.” A Chicago-based Civic Federation spokesman charges it would “all but ensure a stealth property tax being imposed on localities across the state.”
S.B. 1937 would essentially reverse legislation passed in 2010 under former Gov. Pat Quinn that created the so-called Tier 2 benefit system for public employees hired on or after Jan. 1, 2011.
Tier 2 benefit reductions were designed to slow down staggering increases in pension costs that were bankrupting the state. Despite that, the state’s five public-pension systems are drowning in a $140 billion-plus debt.
The Illinois AFL/CIO, a political powerhouse, is pushing for a substantial benefits boost, and craven legislators are bowing before them. Only the unreliable Gov. J.B. Pritzker stands in the way of more catastrophic public-pension debt.
Pritzker said last week the bill “needs a lot more work” before he’ll sign it. But who knows what that means, given the credibility the governor recently forfeited when he approved $11 billion in pension sweeteners for Chicago police and firefighters.
Pritzker defended his indefensible signing by saying Chicago Mayor Brandon Johnson hadn’t told him not to sign the bill. Actually, Johnson’s office warned of consequences that included “effective insolvency” for any Chicago pension funded at 20 percent or less.
That, however, was then. S.B. 1937 is now.
Ostensibly, these changes are meant to address alleged “safe harbor” shortcomings in Tier 2 that leave the benefits less than those provided by Social Security. If Tier 2 violates “safe harbor” provisions, the state would have to make up the difference.
But here’s the deal. It’s not clear that Tier 2 is in violation or, if so, by how much. Why not find out first? Probably because S.B. 1937 advocates don’t want to know the answer.
Instead, they propose a variety of enhancements that include lowering the Tier 2 retirement age from 67 to 65, raising the maximum salary on which a person’s pension is calculated and sweetening annual cost-of-living increases.
How much would that cost? A mere $30 billion by 2045.
That’s the estimate made by Segal, the benefits firm that studied the issue.
Actually, it’s even higher. Segal based its projections on studies of just three of the state’s five public pensions — teachers, state employees and university employees.
A Segal spokesman said because of “limited data,” the cost estimate does not include pensions for judges, legislators, municipal employees, police officers, firefighters, park employees and laborers.
None of this bothers legislators. They’re leaving it to an erratic governor to spare the public from more of the same fiscal insanity that created Illinois’ current financial woes.
