Illinois pensions

Flickr user Pictures of Money / "Money" (CC BY 2.0)

Illinois workers get an added bonus once they retire -- they don't have to pay taxes on pension or Social Security checks.

It's one possible change the state could consider as it hunts for more money.

Illinois is a rare state that taxes income on a regular paycheck but not on retirement.

Fiscal experts -- like the non-partisan Civic Federation -- say that, as Illinois' population ages and there are more retirees and pensioners, the government will increasingly lose out on a source of revenue.

State Lawmakers Discuss Rauner's Power Over Pensions

Mar 10, 2016
Brian Mackey

Illinois lawmakers are considering whether to let Governor Bruce Rauner reduce or delay pension payments.

The measure would give the governor the power to make unilateral cuts and reallocate money around state government.

Rauner's budget director says the governor would rather get a bipartisan deal -- including pension changes -- instead of going it alone.

Senate President John Cullerton has a pension proposal Rauner supports. But Cullerton says his legislation is not a quick fix for the state's massive pension liability. 

illinois.gov

Springfield may be a desert when it comes to budget deals, but it seemed like there was a small oasis: an agreement between Republican Gov. Bruce Rauner and Democratic Senate President John Cullerton on pensions.

They say Illinois could save a billion dollars a year by forcing teachers and state workers to make a choice. Either retire on a higher pensionable salary, or be allowed to receive compounded cost-of-living bumps upon retirement.

During his budget address last week, though, Rauner signaled impatience:

The Illinois Supreme Court has struck down legislation that tried to cut retirement benefits for thousands of state workers.

In a unanimous decision, the high court says lawmakers overstepped their power when they sought to cut pension benefits for state employees, university workers and public school teachers.

Illinois pensions are protected by the state Constitution, but the state argued a financial emergency meant those protections could be disregarded.

Democrats Push For Pension Plan Details

Apr 14, 2015
Brian Mackey / WUIS/Illinois Issues

Gov. Bruce Rauner’s ideas about how to change government-employee pensions are getting extra scrutiny in Springfield.

Rauner wants employees to be moved into less-generous plans for future pension benefits.

So far, it’s just something he’s talked about. Democrats who’ve long focused on pension issues say that needs to change.

Sen. Daniel Biss, of Evanston, is calling for an actuarial analysis. He also says the idea that legislation would be passed and make it through the inevitable court challenge any time soon is a “fantasy."

Pension Overhaul In Hands Of State Supreme Court

Mar 11, 2015
Illinois Supreme Court

Oral arguments on whether state law passed in 2013 will stand were held Wednesday before the Illinois Supreme Court. 

The law reduces benefits for public employees like teachers, prison guards and many others.

State-employee unions object, citing a section of the state constitution -- Article VIII Section 5 -- which they say clearly prevents the state from taking such action.

Illinois Solicitor General Carolyn Shapiro, representing the state, disagrees.

Some of the main architects of the Illinois law that seeks to save the state money by reducing workers' pensions have begun collecting pensions of their own.

State of Illinois

Legislators passed a law overhauling the state's retirement systems. Soaring pension debt remains a concern. The law's constitutionality is also in question. It reduces workers' and retirees' benefits, and raises the retirement age.

SUAA

The State Universities Annuitants Association, which lobbies to protect the pension benefits of higher education employees, and the Illinois Attorney General have reached a tentative agreement to push the start of pension reform for community college and university workers back until July 2015.  The agreement must still be approved by a Sangamon County judge.

In a release, SUAA Executive Director Linda Brookhart says the deal addresses a critical issue:

This month, Illinois lawmakers took a major step in repairing the state's finances by approving a pension overhaul. The plan has its critics, including unions who promise to file a lawsuit. The courts will decide whether the pending changes violate the state's constitution. 

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