It’s Groundhog Day, not April Fool’s Day, for IL pension reform
By Benjamin Yount | Illinois Watchdog
SPRINGFIELD, Ill. — The calendar says April 1, but it feels more like Groundhog Day.
Once again, unions in Illinois are issuing the same complaints about another pension-reform plan.
SPARE A DIME? Chicago is looking at tax hikes, modest pension reforms to close a $19.5 billion gap.
“The City’s proposal is an unconstitutional approach that makes onerous cuts to the pension benefits of nearly 50,000 active and retired public servants,” says a statement from the union group We Are One Chicago.
“These cuts are all the more devastating considering that these cafeteria workers, librarians, health care employees, food and water safety inspectors, nurses and others do not receive any Social Security benefits.”
What are these “unconstitutional” and “devastating” cuts?
Chicago Mayor Rahm Emanuel wants public workers to pay 2.5 percent more toward their retirements, and he wants to tweak cost-of-living raises.
Some 50,000 workers would still receive defined benefit pensions and a guaranteed paycheck for the rest of their lives — the checks would just be a little smaller.
Taxpayers are going to see their property taxes rise to make up for the city’s share of the new pension funding plan, Emanuel told the Chicago Tribune.
Chicago already has the second highest property tax rate in the country.
Emanuel is facing a $19.5 billion dollar city pension debt. He hopes his new plan would cut that in half.
But it doesn’t go far enough, according to Bob Williams, president of State Budget Solutions, a nonprofit, nonpartisan public policy group.
“The solution is to provide true retirement security by keeping our promises (guaranteeing the pension benefits earned are not reduced); keeping our communities strong and safe (by not being forced to cut other essential services in order to make pension payments) and keeping politicians out of government employees’ pensions,” Williams told Illinois Watchdog. “This can best be done by putting all employees in a defined-contribution (401 (k)-style) plan right now.”
Contact Benjamin Yount at Ben@IllinoisWatchdog.org and find him on Twitter @BenYount.