CHICAGO, July 30 Illinois Governor Pat Quinn
said on Monday he is calling a special legislative session in
August for lawmakers to deal with "comprehensive" reforms to
ease the state's huge unfunded pension liability.
Quinn said that since their regular session ended on May 31,
legislative leaders have had enough time to study ways the state
can enact constitutional changes to pensions for state workers,
teachers and others.
"We can't afford to wait another moment," Quinn said in a
speech to the City Club of Chicago, adding that Illinois' $83
billion unfunded pension liability was growing by millions of
dollars each day and gobbling up revenue the state needs for
education, health care, public safety and other essential
Revenue from a big increase in income tax rates last year
largely went to fund pension payments for Illinois. But with
those payments accounting for about 15 percent of its $33.7
billion general funds budget, the state has kept accumulating
billions of dollars in unpaid bills and other obligations.
The structural budget imbalance and pension liability have
led credit rating agencies to lower Illinois' ratings. Standard
& Poor's Ratings Services has warned of a multi-notch downgrade
if progress is not made.
The Aug. 17 special session called by Quinn for both the
Democrat-controlled House and Senate will coincide with an
already scheduled House session called by Speaker Michael
Madigan to potentially expel a state representative who was
indicted for bribery in March and still won the primary election
for his seat.
A 12-YEAR COST-SHIFT PLAN FOR SCHOOLS
But it was not clear if lawmakers from either political
party were ready to tackle pensions after reform legislation
fizzled in the House on May 31. A big stumbling block is the
Teachers' Retirement System, which covers all public school
teachers with the exception of those in the Chicago Public
Schools, who have their own pension system.
Quinn on Monday called for a plan to allow school districts
to assume pension costs now paid by the state over a 12-year
period. He said school districts would be better off financially
under the phased-in plan than having state pension payments
continuing to squeeze out education funding, which was cut by
more than $200 million in the current budget.
Some Republican lawmakers have objected to the pension
cost-shift onto schools, saying it would result in big local
property tax increases.
Republican House Leader Tom Cross and Senate Leader
Christine Radogno issued a joint statement saying they were
encouraged by Quinn's action to call a special session.
"As many people know, we have been and continue to be
supportive of comprehensive pension reform that solves the major
crisis facing us today," the statement said. "The time to act
has been upon us."
Reaction from Democratic legislative leaders was not