By Mark Fitton
Illinois News Network
SPRINGFIELD — Two Democratic legislators considered pension experts among their peers say Gov. Bruce Rauner needs to get his pension proposal into a bill very soon.
State Sen. Daniel Biss, D-Evanston, and state Rep. Elaine Nekritz, D-Northbrook, also say Rauner’s pension proposal needs a thorough vetting by actuaries and a sign-off from the feds before lawmakers can even know whether it might work.
“The road to pension hell is paved with rash actions,” Biss said at a capitol news conference Tuesday morning.
The governor’s press secretary, Catherine Kelley, replied in a statement:
“Illinois’ current pension system is unaffordable and choking the state’s budget, and the governor’s plan enacts true pension reform for the financial future of Illinois. Sen. Biss and Rep. Nekritz’ caucus staffs received the governor’s proposal weeks ago to review, and the administration believes there is ample time to review and pass the governor’s pension plan.”
The Republican governor’s pension plan, which he says could save the state $2.2 billion in fiscal 2016, relies on paying out benefits at existing levels, Tier 1, for work already performed but paying less-generous benefits, Tier 2, for all state employees starting in the fiscal year that begins July 1.
The lawmakers said the Legislature created Tier 2 for all new state hires in 2011 to help save an estimated $64 billion in pension obligations.
But Biss and Nekritz say the Tier 2 plan could fall out of compliance with a federal government mandate to provide a benefit that is at least comparable to Social Security.
In short, they say Rauner needs to get his specifics into a bill and before legislators. They say a realistic proposal will need:
- Detailed analysis by professional actuaries retained by the state’s major pension systems.
- A ruling from the Internal Revenue Service on whether it complies with federal law.
- Discussion and consideration by legislators and give and take with the governor’s office.
All of that takes time, the lawmakers said, and there are about seven weeks left in the scheduled legislative session.
“This is a very, very complicated and difficult arena to move through and if we are to do something quickly … this is something that should have been started two months ago,”
“If were’ going to do something in the next seven weeks, we’d better get at it.”
The lawmakers said they weren’t criticizing Rauner but giving him and the state retirement systems a heads-up.
Illinois is facing a pension debt of about $111 billion. The General Assembly passed its version of pension reform in 2013, and it is under review by the Illinois Supreme Court.
Biss and Nekritz were two of that law’s principal architects.