Battle Brewing Over Public Pensions in Illinois

Chicago - COMPLETE COVERAGE:

EXPERTS: What Does the Pension System Mean?

STORY: Battle Brewing Over Public Pensions in Ill.

LINK: Civic Committee Monthly Report, Nov. 2009 (PDF)

LINK: The Pew Center on the States

 The Illinois General Assembly has approved a new set of pension rules designed to help ease the state's growing budget problems.

Under a proposal being sent to the governor, future government workers will have to work until 67 to get full benefits.

It will limit annual increases in payouts to 3 percent or half the rate of inflation, whichever is less, and it will set a cap on the amount of benefits one worker could receive.

The bill now goes to the governor's desk for his signature.

As a drama teacher in Wheaton, Terri Tudor never thought she'd be following the theatrics in Springfield so closely.

But with Illinois’ public pensions now in the spotlight, she's worried what will happen to education and educators in Illinois.

"Even though it’s not our fault, we’re the ones who could end up paying a huge price for it and it’s our kids who are going to pay a huge price for it," Tudor said.

At this rate, it's our kids who could end up bailing us out. Right now, the state pension system is about $85 billion in the hole, a debt that ranks dead last in the country, according to the Pew Research Center. Even if we wanted to break even, every single person in the state would have to generously donate $6,600 tomorrow.

"They seem to think we're an open wallet and we can pay for it no matter what," said Lennie Jarratt, the creator of the Web site, educationmatters.us, a pension reform and education watchdog blog. "You get a position teaching or any public employee job and it's like hitting the lottery because you're going to make more than any of us in retirement," Jarratt said

Down the road, there's genuine concern among policy analysts in the state, that taxpayers may have to sacrifice other services, such as health care, just to fund the public pension system.

"If you're worried about police being on the street. If you're worried about government reaching into your wallet...the pension will swallow more and more state spending and crowd out healthcare services our state provides to the poorest of the poor," said John Tillman, president of the Illinois Policy Institute, a group that puts out an annual study on public employee pensions in Illinois.

"It's like a Pacman -- remember the old game, Pacman?” Tillman said. “It's swallowing more and more of the revenue fund. The pension costs are 20 percent of general revenue spending and it's going to continue to grow unless we do some reform."

Whatever form of pension overhaul the legislature opts to pursue, it will not impact millions of retired public employees like Ida Lee, a former school librarian who makes about $6,000 a year. The state constitution guarantees that pension benefits cannot be reduced or cut its public employees.

"I did a good job at what I was doing and I think I deserve what I make in pension," Lee said.