Suffredin- For a Better Cook County  
 

Accountability
Forest Preserves
Public Safety
Cook County Budget
Forest Pres. Budget
Property Tax Appeal
Health & Hospitals
Land Bank Authority
Policy Resolutions
Unsung Heroine

 

   
 
   
   
 
   
     
  Office phone numbers:  
   
 
 

The Cook County Code of Ordinances are the current laws of Cook County.

   
 

Search current and proposed Cook County Legislation in Larry's exclusive legislative library.

   
  The Cook County Forest Preserve District maintains over 70 miles of bicycle trails.
   
     
     
     



Illinois has had its pension day of reckoning. Now what?

Saturday, May 09, 2015
Crain's Chicago Business
by Greg Hinz

At its core, the state Supreme Court's big pension decision was pretty simple: Pay what you owe, Illinois.

If only the solution were that simple.

Despite assertions from Gov. Bruce Rauner and Chicago Mayor Rahm Emanuel that their proposed pension fixes still will work—the unanimous Supremes notwithstanding—both leaders likely are whistling past the graveyard. And both now face the same challenge: Find the money without causing taxpayers and job creators to stampede out of state or slashing vital services so deep that Indiana will look generous in comparison.

The task is not impossible. Nothing involving money ever is. But your wallet is about to get lighter, maybe a lot lighter.

Let's start with what the court said. Effectively, the state argued in the case that in a fiscal emergency, it has the right to break a pension promise offered to public workers and teachers when they were hired. Such an emergency exists now and existed in 2013, when Gov. Pat Quinn and the Legislature enacted pension reform, so workers will have to accept reduced benefits, it asserted.

You could almost hear the justices snicker. In their opinion, they noted that government was required to pay full salaries during the Depression, that the General Assembly and Rauner just allowed individual income tax rates to drop to 3.75 percent from 5 percent, and that tough language was inserted into the 1970 Illinois Constitution specifically because the state's politicians have a long, long history of blowing pension money on more popular items, such as roads and schools.

“Other alternatives were available” to pay for pensions, the court said in its May 8 opinion. One obvious one: paying what is owed. The overturned law “was in no sense a last resort. Rather, it was an expedient to break a political statemate.”

Sounds clear to me.

Rauner wants to move workers to a new pension system in which benefits will accrue from now on at a lower rate.

But that would require amending the constitution, and I can't see this court upholding retroactive changes in employment contracts.

Emanuel offers a different protest: Unlike the state law that got tossed, his recent changes in municipal pensions were bargained with labor unions, which agreed to take less in exchange for more city contributions. But by the Supreme Court's logic, that doesn't matter. As it wrote, “Once an individual begins work and becomes a member of a public retirement system, any subsequent changes to the pension (law) that would diminish the benefits . . . cannot be applied to that individual.”

So we gotta pay. But the court didn't say how fast we have to pay. Indeed, so long as every retiree gets his or her full check each month, the court indicated that the state could amortize unfunded pension liability over many decades.

How much would that cost?

According to Ralph Martire, head of the progressive-leaning Center for Tax and Budget Accountability, the state's five main pension funds could be filled to meet 76 to 78 percent of their obligations in 30 years if taxpayers contributed a flat $7.4 billion every year. That's more than the $6.4 billion we're paying this year, and a lot more than the $4.6 billion Rauner wants to spend next year. But once we bite the bullet, the relative hit 10 or 15 years from now would decline thanks to the effects of inflation. To get to 100 percent funding, we'd have to keep making that payment 12 more years, for a total of 42.

Not everyone will like that solution. But Martire's numbers are “absolutely credible,” former Illinois Budget Director Steve Schnorf says.

A different proposed solution comes from the right-leaning Illinois Policy Insitute. It wants to allow municipalities like Chicago and the state itself to declare bankruptcy and walk away from its IOUs.

No American state has done so, and it by no means is clear that state bankruptcy is possible without amending the U.S. Constitution. But that gives you an idea of the new world we live in.

Maybe Rauner will fire thousands of workers or slash their pay 20 percent and dare them to strike. Maybe he'll put some new revenue on the table. Who knows? Only two things are for sure: This “paying up” stuff isn't going to be easy, and it's going to hurt.



Recent Headlines

Measles Exposure Reported in Chicago
Monday, May 20, 2019
WTTW News

News from the Cook County Health System
Friday, May 17, 2019
Special to suffredin.org

Cook County Health Recognizes Mental Health Awareness Month
Thursday, May 16, 2019
Daily Herald

Skokie plans for road improvements near Edens Expressway: 'It’s desperately needed'
Thursday, May 16, 2019
Skokie Review

5 Chicago hospitals earn D grades for patient safety in new report, Northwestern slips to a B
Wednesday, May 15, 2019
Chicago Tribune

Chicago Daily Law Bulletin: Backward Glances
Wednesday, May 15, 2019
Chicago Daily Law Bulletin

Cook County Eliminated Its Gang Database, But Advocates Say Harm Continues
Wednesday, May 15, 2019
WBEZ News

New Cook County Housing Authority Proposal Targets the 'Missing Middle'
Wednesday, May 15, 2019
Evanston RoundTable

Census Citizenship Question Could Hurt Citizens, Noncitizens Alike
Wednesday, May 15, 2019
WBEZ Chicago Public Radio

News from Friends of the Forest Preserves
Tuesday, May 14, 2019
Special to suffredin.org

Cook County commissioners get earful about soon-to-be-destroyed gang database
Tuesday, May 14, 2019
Chicago Sun-Times

Detainee dies days after suicide attempt at Cook County jail
Tuesday, May 14, 2019
Chicago Sun-Times

Curious City How Chicago Women Created The World’s First Juvenile Justice System
Monday, May 13, 2019
WBEZ Chicago Public Radio

Cook County report: Sharp drop in jail population, but crime did not jump
Friday, May 10, 2019
Injustice Watch

Will Cook County be home to the next big measles outbreak? Researchers think so.
Friday, May 10, 2019
Chicago Tribune

May is Prime Time for Birding in the Forest Preserves of Cook County
Thursday, May 09, 2019
Special to suffredin.org

More Babies Are Illegally Abandoned Than Turned Over Through Illinois’ Safe Haven Law In Cook County
Thursday, May 09, 2019
CBS Chicago

Empty businesses may lose county tax incentives
Wednesday, May 08, 2019
Homewood-Flossmoor Chronicle

As new DCFS report highlights failures, Cook County guardian says 'inept' child welfare agency is ‘not doing its job ... at every level’
Tuesday, May 07, 2019
Chicago Tribune

Cook County passes bill to stop discrimination against tenant applicants
Tuesday, May 07, 2019
Chicago Crusader

all news items

Paid for by Larry Suffredin and not at taxpayer expense. A Haymarket Production.
^ TOP