Quinn ties pension issue to higher education funding

2012-08-14T00:01:00Z 2012-08-14T07:57:04Z Quinn ties pension issue to higher education fundingBy KURT ERICKSON - H&R Springfield Bureau Chief Herald-Review.com

SPRINGFIELD — Gov. Pat Quinn says a failure to make changes in the state’s under-funded pension systems will mean fewer dollars for higher education in the future.

The governor released a projection Monday that said funding for state universities, community colleges and college scholarships for low-income students could be reduced by more than $280 million within five years.

It marked the second time in a week that Quinn has tied his call for pension reform to education funding as a way to ratchet up pressure on lawmakers to take action when they convene in a special session on Friday.

With the House and Senate poised to return to the Capitol for a one-day session on pensions, a coalition of labor unions representing state workers announced it would support raising employee pension contributions if legislators guarantee the state will make its required payments to the state-funded pension systems for teachers, state employees and university employees.

The union also asked Quinn and lawmakers to be included in negotiations.

And, labor leaders also said they support closing a number of tax loopholes, including one on newspaper ink, to help raise money for pensions.

"We have always been willing to be at the table," said Christine Bordman, president of the Service Employees International Union Local 73.

Quinn last week said school districts will suffer if a plan to reduce the state’s $83 billion in unfunded pension liability isn’t put in place this year

Funding levels for various programs are determined by the General Assembly and the executive branch on a yearly basis, meaning no one can know for sure how many tax dollars will be earmarked for various programs in 2017.

"A strong higher education system drives economic development and is essential to moving Illinois forward," Quinn said. "We must rise to the occasion, act responsibly and get the job done on pension reform for the people of Illinois."

Quinn’s numbers are based on a combination of recent education funding cut, future pension costs and how the state’s economy will fare in upcoming fiscal years.

"We don’t anticipate a sudden surge in the Illinois economy," said Quinn budget chief Jerry Stermer.

The House could take up a proposal that would alter benefits for members of the State Employees Retirement System and the General Assembly Retirement System. Downstate lawmakers surveyed about the legislation last week said that proposal does not go far enough and any changes should include retirement systems for teachers, university workers and judges.

Quinn is pushing a proposal that would affect all of the state’s pension systems and would gradually shift some of the cost of pensions from the state to individual school districts and universities.

Opponents say the cost shift will drive up local property taxes that help fund school districts and force universities to offset the costs by further raising tuition.

Under both plans, state workers could keep the 3 percent compounded cost-of-living adjustments of their pensions if they give up access to state-sponsored health insurance and forego having future wage increases count toward their final pension.

If employees accept a lower cost-of-living adjustment, they would be able to keep their health insurance and have future wage hikes included in their pension calculation.

Retirees said altering their benefits would be unconstitutional and unfair.

"We worked for our benefits and our health care," said Virginia Yates, who retired 21 years ago after working as a caregiver at the Murray Developmental Center in Centralia. "It is so unfair for the governor to do this to the retirees."


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(1) Comments

  1. amouhammed
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    amouhammed - August 14, 2012 5:18 am
    Governor Quinn has no idea about the importance of higher education for economic development. He is not interested in human capital. He only cares about the rating agencies. He is a real loyal servant for the finance capital. Mr. Quinn's ideas are similar to those of Mr. Paul Ryan and Mr. Romney. He has squeezed retirees, education, farmers, people of Illinois, receipents of some welfare programs, students, and labor productivity. He has created an uncertain enviornment for the working people and business enterprises. His policies are disintegrating the supply-side of economic growth as well as the demand-side. He is a fake democrat and his policies will increase the state rate of unemployment and reduce the growth rate of the economy. He will create a larger deficit and will force many productive workers and business enterprises to leave the state. He should help the people of Illinois by leaving his post, because he is really cannot do it. In other words, he is calamity.
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