Thread: IL. Quinn quietly signs pension bill into law

Quinn quietly signs pension bill into law

Controversial package is headed for union challenge in court

By Rick Pearson and Ray Long, Chicago Tribune reporters
December 6, 2013

Gov. Pat Quinn launched Illinois' epic attempt to bail itself out of a $100 billion public employee pension debt Thursday, signing into law an ambitious financial, legal and political effort to restore the state's tumbling credit ratings and unstable economy.

Despite the historic nature of the law, which takes effect June 1, the Democratic governor signed the measure behind closed doors, joined by top lawmakers. The quietness of the event symbolized the controversial nature of a package that has that split longtime political allegiances and quickly become fodder for the 2014 campaign season.

The private bill-signing stood in sharp contrast to the public pep rally that master of ceremonies Quinn held when he put his signature on Illinois' gay marriage law little more than two weeks earlier, a move that reaffirmed support among liberals.

On Thursday, Quinn offered a simple signing statement on the pension measure saying "Illinois is moving forward" and calling the law "a serious solution to the most dire fiscal challenge of our time."

Whether the law represents a solution to the state's pension liability will likely be up to the courts to decide. As expected, public employee unions said they had directed their lawyers to prepare a lawsuit to challenge the constitutionality of the law and seek a stay to prevent it from taking effect.

The We Are One coalition of unions, headed by the state AFL-CIO, called the new law an illegal "attempted pension theft."

"Leading politicians and their followers chose to violate their oaths of office, trample on the Illinois Constitution, and willfully ignore the plain letter of the law," the coalition said in a statement. "Once overturned, its purported savings will evaporate and the state's finances and pension systems will be left in worse shape."

At issue is a clause in the 1970 state constitution that defines public pensions as an "enforceable contract" with benefits that cannot be diminished or impaired. But supporters of the measure, including House Speaker Michael Madigan, have maintained that the law will be upheld by the Illinois Supreme Court.

Once again Thursday, Madigan claimed full credit for the legislature's narrow passage of the measure, an unusual posture for the state Democratic chairman to take on legislation that was fought by unions, a traditional Democratic ally.

"The bill would not have passed without me," Madigan said in the statement Quinn's office released, a rare moment of self-congratulation from a veteran politician who prefers to work behind the scenes.

Madigan's boast might be a way for him to push back against the idea that he helped create the financial instability that surrounds state government as someone who has served as House speaker for all but two of the last 30 years.

The new law counts on saving $160 billion over the next 30 years, largely by sharply curbing cost-of-living increases to retirees and requiring many current workers to skip up to five annual cost-of-living bumps when they retire. It also would boost the retirement age for current workers by up to five years, depending on how old they are.

In an effort to get the law deemed constitutional, it has provisions that employees would have to contribute 1 percentage point less to their pensions, pension systems would be allowed to sue to force the state to pay its required employer share to retirement, and a limited number of workers could join a 401(k)-style defined contribution plan.

Earlier Thursday, state Treasurer Dan Rutherford, one of four Republican candidates for governor, took the side of the unions in saying he did not believe the givebacks to workers and retirees were sufficient to be found constitutional.

A rival for the GOP governor nomination, Winnetka equity investor Bruce Rauner, told supporters on Twitter he was not surprised "that a flawed, insider deal crafted behind closed doors is signed behind closed doors too."

Rauner, who has been sharply critical of government unions, had advocated a more stringent plan to shift workers into 401(k) plans — a move viewed as politically impossible in a Democrat-controlled legislature and a proposal difficult for a workforce in which about 80 percent do not receive a safety net of Social Security.

Of the other two Republicans in the race, state Sen. Bill Brady of Bloomington, the 2010 GOP nominee, served on a special pension panel and supported it while state Sen. Kirk Dillard of Hinsdale opposed it for a litany of reasons after previously supporting similar legislation.

Tribune reporter Monique Garcia contributed. Long reported from Springfield.
rap30@aol.com rlong@tribune.com

http://www.chicagotribune.com/news/l...,6178711.story

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