Fri March 22, 2013
House Pension Plan Restricts Cost Of Living Increases
Retired state employees and teachers would see their pensions reduced under the latest measure approved in the Illinois House. The plan restricts the cost of living adjustments retirees receive, applying the bumps only to a retirees' first $25,000 in pension benefits.
Beyond that, a retiree would get an additional $750 a year, instead of the compounded three-percent yearly increase they get now.
Supporters says the COLAs are the biggest reason the state's pension costs are increasing. So limiting them would result in big savings for the state.
But critics remain unconvinced any of them will pass constitutional muster.
And Rep. Mike Smiddy, D-Hillsdale, says it's unfair to punish public workers for lawmakers' wrongs.
Illinois built up so much pension debt because for years lawmakers didn't pay the state's share into the pension funds.
"I cannot go back to my district and look at my teachers in grade school and tell them that because it's our fault, we're still going to make you pay for these things. And they live on this income."
--Rep. Mike Smiddy
It's the third time the House has passed a measure that would have a notable impact on employees' pension benefits. But that just volleys them over to the Senate, which has taken an entirely different approach to the pension issue. Senators earlier this week voted down a plan that contained a cost-of-living cap.
Illinois Public Radio's Amanda Vinicky contributed to this report.