Tryon Reports – Pension Comments

A message from State Rep. Mike Tryon:

Illinois Supreme Court Strikes Down Pension Reform Law

Pension Piggy Bank brokerIn December of 2013, the General Assembly took a vote on a controversial pension reform bill that made sweeping changes to benefits for current and past state employees.

The new law was promptly challenged by the unions and has spent the last year and a half in the court system.

Leading up to the December 2013 vote I was vocal in my opinion that the bill was unconstitutional.

I did a great deal of research into the IL Constitution, the Constitutional Convention where the pension clause was specifically discussed, and even looked at pension reform law suits in other states.

At the conclusion of that research I decided that I could not support a bill that I knew was unconstitutional. [Emphasis added.]

On Friday, May 8, the Illinois Supreme Court unanimously reaffirmed a lower Circuit Court ruling that the reforms were indeed unconstitutional due to a violation of the provision in the Illinois Constitution (Article XIII, Section 5) that asserts pensions are a contractual right and cannot be diminished or impaired. I

n the Illinois Supreme Court ruling the justices permanently prohibited the pension law’s implementation.

As a result of this 1 ½-year court battle, Illinois pension crisis in now worse and lawmakers must start from scratch to find a new solution to this growing problem.

While I regret the delay, I look forward to being a part of those renewed discussions.

Two lawmakers from the IL House appeared on Chicago Tonight on the day of the ruling and talked about what they believe the next steps should be. You can watch that broadcast here.

House Republicans Reject Piecemeal Budget Components

An all-too-often told story played out again Wednesday in the Illinois House of Representatives: the story of a broken, backwards budgeting process intended to divide, not unite.

The process began with Governor Rauner’s introduced Fiscal Year 2016 budget, which is meant to be a starting point for negotiations through which changes are made, with a final budget arriving back on the Governor’s desk for either approval or rejection. The budget process is designed to ensure all priorities are considered and more important that all decisions are made in an open and transparent manner.

Wednesday, in a divisive spirit and with a complete disregard for legislative procedure, House Democrats short-circuited the budget process by bringing the Human Services budget directly to the House floor with little notice and no committee deliberations, then defeated the bill with unanimous Democrat opposition.

This action was not genuine; it was intended to send a message. Recognizing that, the House Republicans voted “Present.”

Immediately thereafter, House Democrats filed 15 additional amendments, cherry-picking various programs vulnerable in the budget and began running them one at a time, again in the hopes of deliberately sabotaging the budget working groups that have been meeting for months, and continue to meet.

Again, House Republicans voted “Present.”

House Republicans Call for Benefit Certainty, Process Reform for Workers Compensation

A lengthy Committee of the Whole hearing on workers’ compensation issues was held before the full House on Tuesday, May 5. Injured workers, members of their families, and other stakeholders testified to lawmakers on the strengths and problems of Illinois’ current system of workers’ compensation.

House Republicans pointed out that many agree that benefit levels to workers should not be changed and there are substantial savings in prospect from reforms to the workers’ compensation process.

Existing pieces of the Illinois workers’ compensation process, including the standard of causation used to reach a definitive determination of what caused a workers’ injury, can be looked at to bring these standards into line with the standard practices of most other U.S. states.

One benefit of these changes, reforms to the process could reduce fraud and speed up the determination of cause of a workers’ injury.

This could lead to faster compensations getting paid to injured workers.

Despite limited workers’ compensation reforms passed in 2011, Illinois still has the seventh highest workers’ compensation costs in the country.

These high structural costs drive jobs to other states, including Indiana, where workers’ compensation costs are more than 50 percent less.

For every $100 in payroll an Illinois employer pays, they pay another $2.35 in workers’ compensation premiums, whereas Indiana employers pay only $1.06.

For 2014, Illinois’ rates are 27 percent higher than the national median.

Governor Rauner Speaks to Chicago City Council, Warns No Bailout

Bruce Rauner

Bruce Rauner

As the fiscal picture darkens for Illinois’ largest city, some advocates have held out hope that Illinois taxpayer could be persuaded to ride to the rescue with moves intended to bail out Chicago.

However, in remarks delivered to the Chicago City Council on Wednesday, May 6, Governor Rauner told Chicago’s mayor and alderman their city has many strengths.

The Governor asserted that leveraging these strengths, combined with sacrifices by stakeholders, will lead to city-state cooperation that offers the best hope of achieving financial recovery.

“Compromise,” the Governor urged.

“Accept things we might normally oppose. That’s going to be required of all of us.” Chicago issues in which State actions are possible include pension reform, a possible Chicago-based casino, school reform, and changes to labor-management law. Bond rating agencies agree that the quality of Chicago’s debt is plunging towards junk-bond levels.


Comments

Tryon Reports – Pension Comments — 3 Comments

  1. From this point forward any new (public employee) hirings by public officials should subject those officials to personal liability.

    Isn’t it Willful Negligence–an unreasonable act in disregard of a known risk—when, say, School Board Members agree to new hires with the certain knowledge that the legal pension entitlement (and maybe even current salaries, given PTELL and mandatory COLA raises) cannot be funded?

    Isn’t personal immunity shield from liability pierced in cases of willful negligence?

  2. imho

    The legislators were fully aware that this legislation was a constitutional violation but they passed it anyway to get the voters off their backs for a while.

    The question is:

    Will the elected idiots do the correct thing and file a resolution for a referendum to change the constitution?

  3. Am I glad I don’t own real estate in Illinois anymore and all my Deferred Comp and investments are housed out side of the state.

    Florida, I am coming soon.

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