News coverage of Illinois Senate Bill 27, May 2005

7/30/2019 News coverage of Illinois Senate Bill 27, May 2005

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Lawmakers OK pension overhaul

Bloomington PantagraphMonday, May 30, 2005

SPRINGFIELD -- Democrats rammed a key piece o the state budget through the House and Senate late Sundaythat will reduce payments to state pension unds to fll a lingering budget gap.In a show o political muscle that included some last-minute horse-trading between Gov. Rod Blagojevich andence-sitting lawmakers, the plan moved out o the House on a 61-53 vote, with no Republicans on board.

Te Senate voted 32-26 in avor o the plan, putting the General Assembly on track to avoid a repeat o last year's

lengthy overtime session.

Supporters say Senate Bill 27 will allow the state to pay about $2 billion less into the state's three largest pensionunds over the next two years. Tat money would then be used to close a $1.2 billion state budget gap and in-crease unds or schools and health care.

State Rep. Robert Molaro, D-Chicago, who sponsored the legislation in the House, said the changes wouldn'taect pension checks or retirees and, because o a series o reorms, wouldn't hurt the state's historically under-unded pension unds. One change will limit the state's cost o covering end-o-career pay hikes or teachers.

State Sen. Je Schoenberg, D-Evanston, the bill's Senate sponsor, said the changes will save $30 billion over thenext 40 years.

But, Schoenberg could not say how much the changes would save in the fscal year beginning July 1 -- a keysticking point or Republicans, who say that represents a raid on the pension unds.

"Nothing good has ever come rom robbing the pension system. Nothing good is going to come rom this," saidstate Rep. Dan Brady, R-Bloomington.

"In my six years in the House, this was the most irresponsible thing this chamber has done," said state Rep. BillMitchell, R-Forsyth. "Democrats think that Illinois citizens are on a holiday weekend and won't be paying atten-

tion to this. I think they are wrong."

Central Illinois Republicans in the Senate were just as opposed to the proposal.

"Less than our months ago Gov. Blagojevich touted the necessity or pension reorm and emphasized the inher-ent dangers o raiding the pension system. Now he is doing the very thing he preached to the General Assemblyagainst," said state Sen. Larry Bomke, R-Springfeld.

In a nod to the days o ormer Gov. George Ryan, Democrats who were wavering in their support o the plan re-ceived promises rom the governor's o ce that some o their pet projects and programs would be unded i they


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supported the plan.

Te governor's o ce acknowledged that lawmakers wanted some goodies i they were going to put their votesbehind the controversial plan.

"Knowing that this budget process is one o give and take, the leaders in recent days have brought orward somepriorities that they would like to see in the budget," said Blagojevich spokeswoman Rebecca Rausch.

Rausch wasn't aware o any specifc projects promised by the governor. "Most o them have to do with socialservices and educational programs, like aer-school programs that beneft our children," Rausch said.

Lawmakers are set to spend today and uesday putting the fnal touches on the state's $53 billion spending plan.Except or schools and health care programs or the poor, most state spending is expected to remain at or thebudget year beginning July 1.

Pension reform plan zips through Legislature

Carbondale Southern IllinoisanMonday, May 30, 2005

SPRINGFIELD - A pension reorm package rocketed through the Legislature Sunday despite criticism that itwould hurt state employees and taxpayers.

Te proposal is being touted by Democrats as a way to close the state's 1.2 billion budget shortall and avoid anovertime session. Proponents estimate the range o savings or the entire program to run rom $30 billion to $70billion.

''We are saving $30 billion to the taxpayers, i you say that's not reorm you're mistaken," said state Rep. Bob Mo-

laro, D-Chicago. ''Tis is good or the taxpayers and good or this budget."

Republicans argued that part o the estimated $820 million that would be used to shore up this year's spendingplan would be used to bail out the troubled Chicago ransit Authority.

''Our pension unds are now going to the Chicago ransit Authority - nothing to do with the pension system,"said state Rep Chapin Rose, R-Mahomet. ''Tey're going to fnance hundreds o millions o dollars in pork expan-sion in the Chicagoland area, pork projects, and all on the backs o the pensioner and ultimately the taxpayer."

Te reorms include a moratorium on beneft increases unless extra money can be ound. In the meantime, a


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taskorce o legislators and unions will look into the uture o beneft increases.

End-o-career payouts to school teachers would be capped at 6 percent. I schools wanted to dole out moremoney that additional cost would have to be picked up by the local district. Current teacher contracts would notbe eected.

Current state university workers and school teachers would also see changes to the money purchase ormula. Teinterest rate would no longer be set by state retirement system o cials; it would be set by the comptroller's o ce.

New hires would no longer be able to choose the money purchase option.

Downstate teachers and the eachers' Retirement System would have to pick up the cost o the Early RetirementOption.

Local lawmaker reaction to the proposal was split along party lines.

State Rep. Mike Bost, R-Carbondale, expects the university workers in his district will be upset over Sunday'svote, as will the taxpayers.

''Whenever I talk to people and explain how long, and how great o a debt this is going to be," Bost said. ''Tey'renot very happy with us."

State Reps. John Bradley, D-Marion, Dan Reitz, D-Steeleville, and Brandon Phelps, D-Norris City, support themeasure.

''Tis provides or signifcant pension reorm," Bradley said. ''It's going to take a period o years to get the pensionsystem in line and this is the frst step in the process o doing that."

Reitz said there were no other options to bring in revenue since the Democrats could not agree on gaming ex-pansion.

''Te other good thing about voting or the total pension bill was we were able to add more money to education,"Reitz said. ''All in all I think it was a good compromise that the leaders reached."

All three representatives discredited the opposition's argument that the holiday would hurt downstate more thanChicago.

''It was used as a political game to try to get us into overtime," Phelps said. ''I know some people say by taking theholiday it's going to put a strain on our uture. I don't believe that because I believe the reorms that we made aregoing to pay or all o that."

State Sen. Gary Forby, D-Benton, voted or the legislation. State Sens. David Luechteeld, R-Okawville, and JohnO. Jones, R-Mount Vernon, opposed the reorm package.

Jennier Miller and Shelby Sebens contributed to this report.


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Pension holiday measure advances

Champaign News Gazette

Monday, May 30, 2005SPRINGFIELD - Te Illinois General Assembly narrowly approved legislation on Sunday to pay $2.3 billion lessinto the state pension systems over the next two years than would be required under current law.Te measure is now on its way to the governor's desk, where he is expected to sign it.Te Illinois Constitution guarantees pension benefts, so the "pension holiday" would not aect retirees' pay-ments.It would, however, signifcantly increase the state's long-term pension debt and would require the retirementsystems to sell o more assets in order to make the payments they owe to retirees, said Republicans, who reusedto support the bill."You are mortgaging our uture," said State Rep. Bill Black, R-Danville. "You are playing with fre, you are playingwith potential bankruptcy o the pension systems."State Sen. Jerey Schoenberg, D-Evanston, said such concerns were "unwarranted" and noted that the bill did notchange the ultimate goal o having enough assets on hand to pay 90 percent o the pension system's obligationsby 2045.Tat target was part o a 1995 law passed to help the state recover rom years o skipped or reduced pension pay-ments, but Senate President Emil Jones, D-Chicago, said the payment schedule set up in that law was "a mistake.""Like a homeowner that has a mortgage, and cannot meet that mortgage payment, will go in and refnance it, weare restructuring the '95 law so that the state can aord to pay the dollars into the pension systems," he said.Some Democrats were less enthusiastic about the plan than others.State Rep. Frank Mautino, D-Spring Valley, said he reluctantly voted yes only because a gaming bill ailed tocome together and no one could agree on any other revenue sources to balance the budget.

"Tis is hard vote, it is not a good vote, and right now there is no one oering other options," he said.State Rep. Robert Molaro, D-Chicago, who sponsored SB 27, said the bill made some important steps orward."For the frst time in 60 years o the pension systems, we are demanding reorms," Molaro said. "Tis is good orthe taxpayers. It's great or the budget."According to Molaro, the beneft changes included in the legislation would save the state $30 billion or $40 bil-lion in payments over the next our decades, which he said would help balance out the long-term impact to thepension systems.Senate Minority Leader Frank Watson, R-Greenville, warned that the savings would be more like $12 billion over40 years and that most o that would not be realized until decades rom now.Te legislation to reduce the state's pension payments or the next two years is the centerpiece o a budget dealJones and House Speaker Michael J. Madigan, D-Chicago, hope to send to the governor by uesday night. Aer

the uesday, they will need a three-fhs majority to pass the budget, which would require Republican votes.Te Democrat spending plan or the year beginning July 1 would add an extra $300 million or schools, givemore money to the Chicago ransit Authority and expand health care coverage or low-income Illinoisans, whileclosing a $1.2 billion budget defcit. State unding or universities is expected to remain at this year's levels.Te House vote on the pension bill on Sunday aernoon was 61 to 53."Tis is a good deal because it saves money, helps balance the budget, prevents painul cuts in state services andavoids major layos o state employees," said state Rep. Naomi Jakobsson, who voted yes.State Rep. Chapin Rose, R-Mahomet, voted no along with Black."No eort has been made to reduce government spending, instead we are going to raid the pensions," Rose said.State Rep. Shane Cultra, R-Onarga had an excused absence and did not vote, but told Te News-Gazette on Sat-


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urday that he did not support the bill."What we have to do is tighten our belts and either cut spending or raise revenue somewhere else," Cultra said.Te bill passed the Senate on Sunday night by a vote o 32 to 26. State Sen. Rick Winkel, R-Urbana; state Sen.Dale Righter, R-Mattoon; and state Sen. Dan Rutherord, R-Chenoa, all voted no."I don't know how you vote yes and go home and explain that," Winkel said.

SPRINGFIELD -- A Democratic bid to withhold nearly $2 billion in required payments to employee pensionsystems to balance the 2006 state budget swept through the Legislature on Sunday, despite Republican compari-

sons o the deal to a payday loan.

On party-line votes, the pension proposal passed the House 61-53 and the Senate 32-26, putting in place thecontroversial cornerstone o a budget deal struck Tursday by Gov. Blagojevich, House Speaker Michael Madi-gan (D-Chicago) and Senate President Emil Jones (D-Chicago).

"We set out to undamentally change and reorm the way the pension system works. Tat's what we did," Blago-jevich said in a statement aer the votes.

Te plan is built upon a series o pension rule changes the governor and other leaders say will save the state atleast $30 billion over the next 40 years. Tey want to use some o those "savings" upront during the next two

years, in part, to cover the $1.2 billion budget defcit.

Among the pension-rule changes voted on was the capping o end-o-career pay hikes or educators at 6 percentannually. Late-career pay increases o as much as 60 percent have exorbitantly boosted educators' tax-undedpensions, a practice that was the subject o a Sunday Chicago Sun-imes expose.

Te newspaper reported on how the retiring fnance director o Adlai Stevenson ownship High School District125 collected lucrative health insurance stipends the last our years, on top o his six-fgure salary, to boost hispension to more than $200,000 a year or the rest o his lie.

"... Is that what we're about? For no other reason, we should vote or this bill to stop that practice," said Rep. Rob-ert Molaro (D-Chicago), the bill's chie House sponsor, waving a copy o the Sun-imes during oor debate.

Republicans railed how it will add to the $34 billion underunding o the state's three biggest pension plans andthat uture generations will be le holding the bill -- all so Blagojevich can balance the state's books today andavoid an overtime session beginning Wednesday that would empower Republicans.

"Tis is like a payday loan or state government," said Sen. Kirk Dillard (R-Hinsdale).

All GOP members opposed

Lawmakers OK skipping pension und payments to balance budgetChicago Sun imesMonday, May 30, 2005


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With the administration claiming immediate savings rom the reorms, some GOP estimates peg the ultimatecost to the pension unds as high as $87 billion because those savings won't be reinvested in the pension systemsand allowed to compound interest.

"Tis is a little like the state using a credit card, charging a little more and a little more, but only making theminimum payment. While we're doing it, the debt keeps getting larger and larger," said Sen. Dale Righter (R-

Mattoon).

With Republicans unanimously voting against the plan, the margins were extremely tight in the House, whereMadigan spent two days trying to line up 60 o his 65 Democrats to vote or the plan. On Saturday, as many as adozen House Democrats were prepared to vote against it, but intense arm-twisting by party leaders le only Rep.Kevin Joyce (Chicago) and Rep. Julie Hamos (Evanston) as Democratic no-votes Sunday. wo House Democratswere absent.

Te bill, which Blagojevich is expected to sign, will not decrease monthly benefts or existing retired state work-ers, teachers and university employees. Lawmakers and judges, who belong to smaller pension systems, were

spared any changes to their lucrative retirement plans.

Balanced budget just passes Pension reforms included, but payments to be skipped

Daily HeraldMonday, May 30, 2005

SPRINGFIELD Suburban Democrats stuck their political necks out Sunday, voting or a plan to skip nearly $2billion in pension payments in order to balance the state budget but at the risk o saddling uture generationswith the tab.

Youre breaking into our childrens piggy banks, stealing rom kids and schools and the disabled o tomorrow,said state Sen. Dan Cronin, an Elmhurst Republican. You think you can get away with it because the publicdoesnt understand.

Republicans uniormly opposed the plan cobbled together by Gov. Rod Blagojevich and Democratic leaders inthe House and Senate, accusing the ruling party o larding up the state budget with $200 million in pet projectsand programs in order to get the votes.

Democrats said they had no choice aer Republicans reused to help fx budget problems.

Its the right thing to do, said Senate President Emil Jones Jr., a Chicago Democrat.

A handul o suburban Democrats provided the votes in both the House and Senate. State Rep. Jack Franks, aWoodstock Democrat, had criticized skipping pension payments but voted or the plan because o the included


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pension reorms.

I hate to qualiy my statement, but the act is i it were standing alone, I wouldnt vote or it, the nonpayment,Franks said aer the vote, denying hed wa ed. I slept on it last night and I eel compelled to (vote yes) just be-cause I think we need these reorms. And without the vote, were not going to get these reorms.

Te plan cleared the House by two votes. All fve suburban Democrats voted or it.

A party-line vote in the Senate cleared the way or the General Assembly to adjourn on time by uesday night.

Among the pension changes are limits to the end-o-career pension sweeteners school boards oen handed outto inate administrators and teachers retirement checks. Te new plan limits to 6 percent the fnal years payraises, down rom 20 percent.

Democrats say these and other pension changes will save the state $30 billion, i not more, over the next 40 yearsand the state can start recognizing those savings now.

Tats how they justiy shorting the pension system nearly $2 billion over the next two budgets. Te move allows

them to balance this years budget without raising taxes.

Tis is good or the taxpayers. Its great or this budget, said state Rep. Robert Molaro, a Chicago Democrat whosponsored the pension plan.

Republicans roundly criticized the plan as shortsighted and irresponsible, like skipping minimum payments onmaxed-out credit cards just because times are tight.

Tis is a payday loan or state government, Hinsdale Republican state Sen. Kirk Dillard said.

Republicans doubt those savings will materialize and argue its irresponsible to count them now anyway.

Tere are no real undamental reorms and there are no real savings, said state Rep. Mark Beaubien, a Bar-rington Hills Republican.

He pointed out the pension changes dont apply to Chicago teachers, whose pension system actually gets $9 mil-lion more in state tax dollars while other pension systems are shortchanged.

Republicans also said as much as $200 million was being diverted to pay or supporters pet projects. Franksdenied he was promised anything.

Republicans questioned how lawmakers and judges who enjoy lucrative retirement benefts were exempted romthe reorms.

I cant answer that right now,


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Plan to cut pension payments approvedDecatur Herald ReviewMonday, May 30, 2005

SPRINGFIELD - A pension reorm package rocketed through the legislature Sunday despite criticism that itwould hurt state employees and taxpayers.

Te proposal is being touted by Democrats as a way to close the state's $1.2 billion budget shortall by taking$820 million rom the state pension program. Proponents estimate the savings will range rom $30 billion to $70billion in the long run.

"We are saving $30 billion to the taxpayers, i you say that's not reorm, you're mistaken," said state Rep. Bob Mo-laro, D-Chicago, the proposal's House sponsor. "Tis is good or the taxpayers and good or this budget."

Republicans argued that part o the estimated $820 million used to shore up this year's spending plan would alsobe used to bail out the troubled Chicago ransit Authority.

"Our pension unds are now going to the Chicago ransit Authority - nothing to do with the pension system,"said State Rep. Chapin Rose, R-Mahomet. "Tey're going to fnance hundreds o millions o dollars in pork ex-pansion ... and all on the backs o the pensioner and ultimately the taxpayer."

Te reorms include a moratorium on beneft increases unless extra money can be ound. In the meantime, a

task orce o legislators and unions will look into the uture o beneft increases.

End-o-career payouts to schoolteachers would be capped at 6 percent. I schools wanted to dole out more, thatadditional cost would have to be picked up by the local district. Current teacher contracts would not be aected.

Current state university workers and schoolteachers also would see changes to the money purchase ormula. Teinterest rate would no longer be set by state retirement system o cials; it would be set by the comptroller's o ce.New hires would no longer be able to choose the money purchase option.

Downstate teachers and the eachers' Retirement System would have to pick up the cost o the Early RetirementOption.

Local lawmaker reaction to the proposal was split along party lines.

State Rep. Bob Flider, D-Mount Zion, voted in avor o the proposal.

"Tis provides or an opportunity to reorm the pensions in a way that will save $70 billion over the lie o thereorms," Flider said.

Te representative said the General Assembly's ailure to adequately und pensions in the past is the reason thesystem needs reorm.


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State Rep. Bill Mitchell, R-Forsyth, balked at the proposal dumping more money into the Chicago public schoolteachers' retirement und.

"How do you tell the teachers in Macon County in Decatur that we can't ully und their pension, but we can theChicago teachers? Tat's what this General Assembly did," Mitchell said.

State Rep. Roger Eddy, R-Hutsonville, said Democrats such as House Speaker Michael Madigan, D-Chicago,

supported the measure in order to avoid an overtime session, which would give Republicans more say over thebudget.

"Desperate times call or desperate measures, and this is desperation by a party that obviously has shown that itcan't govern," Eddy said. "(Madigan) wanted to erase that perception, by showing that he could."

Senate Minority Leader Frank Watson,

R-Greenville, opposed the legislation as well as Sens. Bill Brady, R-Bloomington, and Dale Righter, R-Mattoon.

Lawmakers OK pension cutsPeoria Journal StarMonday, May 30, 2005

SPRINGFIELD - Both the Illinois House and Senate narrowly approved a bill Sunday to divert more than $2.3billion rom state pensions over the next two years so it can be used instead to fnance other state programs.

Te House voted 61-53 to approve Senate Bill 27, just one vote more than the minimum needed or passage. TeSenate voted 32-26. In both chambers, the vote split nearly along party lines, with Democrats supporting the billand Republicans voting against it.

"You are playing with fre. You are playing with potential bankruptcy o the pension system," said Rep. Bill Black,R-Danville. "We are mortgaging all o our tomorrows or the expediency o adjournment by May 31."

But Democrats said there were no options le or closing a $1 billion plus budget hole without making substan-tial cuts to state programs.

"Tis is a hard vote. It is not a good vote and right now, there is no one oering any other options," said Rep.Frank Mautino, D-Spring Valley.


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No Republicans voted or the bill in either the House or Senate. wo Democrats - Kevin Joyce o Chicago andJulie Hamos o Evanston - voted against the bill in the House.

No Democrats voted against the bill in the Senate.

Under this legislation, about

$1.2 billion that was supposed to be deposited in the fve state-unded pension systems aer July 1 instead will be

used or other programs. An additional $1.1 billion will be diverted next year. Te money was intended or pen-sions covering downstate teachers, state and university workers, judges and lawmakers.

Republicans said the long-term cost o the diversions will be $30 billion or more.

"For every dollar we get rom the systems today, the cost is $11 to pay it back," said Rep. Chapin Rose, R-Ma-homet. "It's like Wimpy rom Popeye. I'll gladly pay you uesday or a hamburger today."

'Demanding reorms'

However, Rep. Robert Molaro, D-Chicago, said the diversions come with pension beneft changes that will save$30 billion in coming decades. Among those changes are limiting the amount o end-o-career teacher raises thatthe state will cover with pensions, changing the way interest is determined on the money purchase retirementoption oered to university employees, limiting the number o state employees who qualiy or the more lucra-tive alternative pension ormula and requiring uture pension enhancements to be ully unded.

"For the frst time in the 60 years o the pension systems, we are demanding reorms," Molaro said.

"We are making real reorms," said Rep. Jay Homan, D-Collinsville. "Is that what this is all about? Do you (Re-publicans) want to push us into overtime?"

Last year, the General Assembly ran a record 54 days into overtime. Gov. Rod Blagojevich said he thought Re-publicans were stalling budget talks in hopes o orcing an overtime session where they would have greater clout.

Rep. Mark Beaubien, R-Barrington Hills, said the reorms don't require any changes in the pension systems orstate employees, judges and lawmakers. Te bill eliminates the reorms proposed by Blagojevich that would havesaved the most money, Beaubien said.

"Tere are no real undamental reorms," Beaubien said. "Tere are no real savings."

Republican unrest

Republicans repeated their charge that Blagojevich and House Speaker Michael Madigan, D-Chicago, essentiallybought votes or the plan by promising pork projects or increased state spending or specifc programs. HouseRepublican Leader om Cross, R-Oswego, said the size o the diversion increased by $200 million as Madiganworked to line up votes or it.

"Tat is outrageous, and I can't imagine that people want to let that go on," Cross said.

Blagojevich spokeswoman Rebecca Rausch said the administration has agreed to several "memorandums o un-derstanding" about items that will be included in the budget. Te memorandums were not made public Sunday.


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"As the budget process progressed this year individual members discussed various programs and initiatives withtheir leaders," Rausch said. "Most o these surround social and educational programs that beneft our youth. Tisis a process o give and take. We reviewed these requests, and we agreed."

Madigan and Senate President Emil Jones, D-Chicago, brought the requests to Blagojevich.

"Most o the priorities the leaders brought to us occurred in the last ew days," Rausch said.

Changing sides

Rep. William Delgado, D-Chicago, initially opposed the plan but voted or it Sunday. He said he received anagreement that some aer school programs and new immigrant services programs will be unded.

"I wasn't going to (be able to) stop the bill," Delgado said. "I wasn't going to be the obstacle to other programsthat are very important to us in terms o unding or social services."

Joyce - one o the two House Democrats to vote "no' on the bill - said Madigan tried to persuade him to vote orthe legislation.

"I just think it's fscally wrong to put this o," Joyce said. "It's tough to go against your leader, but sometimes youhave to stand by your convictions and do what you think is right."

Pension holiday passesRockord Register StarMonday, May 30, 2005

SPRINGFIELD -- Aer sweetening the deal by reeing up more cash or state spending, Democrats advancedtheir plan Sunday to balance the state's budget by skipping payments to public pension systems.

Te move could saddle taxpayers with billions in long-term debt, but it put the Democrat-controlled Legislatureon track to fnish its spring session by uesday. Come June, Democrats can't implement a spending plan withoutGOP support.

Te Democrats approved the plan to cut pension payments -- 61-53 in the House, 32-26 in the Senate -- aerhiking the total reduction rom $2.1 billion to $2.3 billion over two years, eectively giving legislators $200 mil-lion more to spend on other concerns.

Republicans accused Democrats o cultivating support with the promise o pork-barrel projects fnanced withthat $200 million.

"I you have intelligence above plant lie, you can fgure out what happened because all o a sudden we got thenecessary votes," said Rep. Jim Sacia, a Pecatonica Republican who voted no.


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Democrats said the extra cash was necessary to help close an estimated defcit o $1.2 billion. Still, Rep. ChuckJeerson o Rockord acknowledged that it made the package more attractive.

"It gives us the ability to do more things in the line o service to agencies that otherwise might have been on theverge o being cut back," said Jeerson, who joined his ellow Democrats in supporting the plan.

Te Rock River Valley's other legislators -- Sens. Dave Syverson o Rockord, Brad Burzynski o Clare and oddSieben o Geneseo, and Reps. Dave Winters o Shirland and Ron Wait o Belvidere -- opposed it. All are Republi-

can.

Lawmakers o both parties agree that skipping payments increases the state's long-term liability because interestwill not be earned on money not invested.

Pension diversion plan passes House, Senate narrowly OK contentious billState Journal RegisterMonday, May 30, 2005

Te Illinois House and Senate narrowly approved a bill Sunday to divert more than $2.3 billion rom state pen-sions over the next two years so it can be used instead to fnance other government programs.

Te House tally on Senate Bill 27 was 61-53, just one vote more than the minimum needed or passage. Te

Senate vote Sunday night was 32-26. In both chambers, the vote split nearly along party lines, with Democratssupporting the bill and Republicans against it.

"You are playing with fre. You are playing with potential bankruptcy o the pension system," warned Rep. BillBlack, R-Danville. "We are mortgaging all o our tomorrows or the expediency o adjournment by May 31."

But Democrats said there were no options le or closing a $1 billion-plus budget hole or the fscal year thatbegins July 1 without making substantial cuts to state programs.

"Tis is a hard vote. It is not a good vote, and right now, there is no one oering any other options," said Rep.

Frank Mautino, D-Spring Valley.

No Republicans voted or the bill in either the House or Senate. wo Democrats - Kevin Joyce o Chicago andJulie Hamos o Evanston - voted "no" in the House. No Democrats voted against the bill in the Senate.

Under the bill, about $1.2 billion that was supposed to be deposited in the fve state-unded pension systems aerJuly 1 instead will be used or other programs. An additional $1.1 billion will be diverted the ollowing year.

Te money was intended or pensions covering downstate teachers, state and university workers, judges and law-makers. Te diversion o unds won't reduce retirees' monthly checks but will increase the state's long-term debt.


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Republicans estimated the eventual cost at $30 billion or more.

"For every dollar we get rom the systems today, the cost is $11 to pay it back," said Rep. Chapin Rose, R-Ma-homet. "It's like Wimpy rom 'Popeye.' I'll gladly pay you uesday or a hamburger today."

However, Rep. Robert Molaro, D-Chicago, said the diversions come with pension-beneft changes that will savethe state $30 billion in coming decades.

Among those changes are limiting the amount o end-o-career teacher raises the state will cover, changing theway interest is determined on the money purchase retirement option oered to university employees, limitingthe number o state employees who qualiy or the more lucrative alternative pension ormula, and requiringuture pension enhancements to be ully unded.

"For the frst time in the 60 years o the pension systems, we are demanding reorms," Molaro said.

"We are making real reorms," added Rep. Jay Homan, D-Collinsville. "Is that what this is all about? Do you(Republicans) want to push us into overtime?"

Last year, the General Assembly ran a record 54 days into overtime as legislative leaders tried to reach a budgetcompromise. Democratic Gov. Rod Blagojevich had said he thought Republicans were stalling this year's budgettalks in hopes o orcing another overtime session where they would have greater clout.

Rep. Mark Beaubien, R-Barrington Hills, noted that the Democrats' reorms don't change anything in the pen-sion systems or state employees, judges and lawmakers. Te bill passed Sunday eliminates pension changesproposed by Blagojevich that would have saved the most money, Beaubien said.

"Tere are no real undamental reorms," Beaubien said. "Tere are no real savings."

Republicans repeated their charge that Blagojevich and House Speaker Michael Madigan, D-Chicago, essen-

tially bought votes or the pension plan by promising pork projects or increased spending or specifc programs.House Republican Leader om Cross o Oswego said the size o the diversion increased by $200 million as Madi-gan worked to line up votes or it.

"Tat is outrageous, and I can't imagine that people want to let that go on," Cross said.

Blagojevich spokeswoman Rebecca Rausch acknowledged that the administration has agreed to several "memo-randums o understanding" about items that will be included in the fscal 2006 budget. Te memorandums werenot made public Sunday.

"As the budget process progressed this year, individual members discussed various programs and initiatives withtheir leaders," Rausch said. "Most o these surround social and educational programs that beneft our youth. Tisis a process o give and take. We reviewed these requests, and we agreed."

Madigan and Senate President Emil Jones, D-Chicago, brought the requests to Blagojevich.

"Most o the priorities the leaders brought to us occurred in the last ew days," Rausch said.

Rep. William Delgado, D-Chicago, initially opposed the pension bill but voted or it Sunday. He said he was as-sured that some aer-school programs and new immigrant-services programs will be unded.


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"I wasn't going to (be able to) stop the bill," Delgado said. "I wasn't going to be the obstacle to other programsthat are very important to us in terms o unding or social services."

Joyce - one o the two House Democrats to vote "no" - said Madigan tried to persuade him to support the legisla-tion.

"I just think it's fscally wrong to put this o," Joyce said. "It's tough to go against your leader, but sometimes youhave to stand by your convictions and do what you think is right."

Sunday's vote puts into place a key part o a budget plan that should allow lawmakers to fnish their work byuesday's constitutional deadline. Te actual state spending plan could be presented to lawmakers as early astoday.

uesday is the deadline or enacting a new budget i lawmakers want to avoid having to muster a three-fhsmajority to pass it.

High cost o deerring pension paymentsDaily HeraldSunday, May 29, 2005

Were damning our grandkids.

With those words in February, Steve Brown, spokesman or Illinois House Speaker Michael Madigan, a ChicagoDemocrat, criticized past legislative decisions to ignore pension contributions and spend money elsewhere.

Fast orward to the end o May, with the legislative session set to close. Te Democrats, including Madigan, arein control and ready to do the same thing all over again.

As a way to fx the current budget problems, the Democratic leadership is ready to push through a proposal topass as much as $1.1 billion in pension debt onto uture generations. Te state would skip part o next years pay-ment into its employee pension system and use the money to fll a $1.2 billion hole in the budget.

Te Democrats say they also will pass some changes to uture pension benefts to save money over time. But not

paying the debt now pushes the burden into the uture to the tune o about $13 or every dollar not paid thisyear.

Its a mistake and they know it. Tat is why the states leading Democrat, Gov. Rod Blagojevich, said in his Febru-ary budget address that not paying the pension debt is akin to irresponsible credit card use.

So what happens? Te principal goes up, the interest rate goes up and the monthly minimum goes up. Its exactlywhat the state o Illinois has been doing year in and year out.

So much or reorm. Apparently, Blagojevich has thrown in the towel and decided he must do what others have


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done, despite his dire warnings o just a ew short months ago.

Republicans, on the other hand, are saying all the right things now.

Financially, its one o the worst things we can do as a state. I cant imagine that were going down this road, saidHouse Republican leader om Cross o Oswego in a Daily Herald article Friday.

Te GOP leaders were banking on gambling expansion just like the Democrats but that seems dead thanks to

Mayor Richard M. Daleys remarks that the city should get a casino as part o any expansion. But Republicanshave yet to come up with something else to deal with the current budget woes.

So, its the end o May. Te clock is winding down on another legislative session. Te politicians want to avoidovertime, like last years two-month embarrassment, and they throw out the old tried-and-true method o justnot living up to the states obligations.

Let someone else worry about the consequences. Weve got a budget to approve and we need the money and noone is coming orward with another idea.

Grandkids, be damned.

News coverage of Illinois Senate Bill 27, May 2005

Documents

Transcript of News coverage of Illinois Senate Bill 27, May 2005