Illinois' Democrat-controlled Legislature has notably lagged behind in finding the political will to deal with its ballooning financial problem. Meanwhile, annual pension payments grew to about one-fifth of the state's general funds budget, taking money away from schools, roads and other areas.
The measure approved Tuesday emerged last week following negotiations by a bipartisan pension conference committee and then meetings of Illinois' legislative leaders. They say it will save the state $160 billion over 30 years and fully fund the systems by 2044.
It will push back the retirement age for workers ages 45 and younger, on a sliding scale. The annual 3 percent cost-of-living increases for retirees will be replaced with a system that only provides the increases on a portion of benefits, based on how many years a beneficiary was in a job. Some workers will have the option of freezing their pension and starting a 401(k)-style defined contribution plan.
Workers will contribute 1 percent less to their own retirement under the plan. Legislative leaders say they included that provision, as well as language that says the retirement systems may sue the state if it doesn't make its annual payments, in hopes of boosting the measure's odds of surviving the unions' anticipated court challenge.
In addition to the labor unions, some Republicans said they opposed the bill because it didn't cut benefits enough. Other opponents said there wasn't sufficient time for lawmakers and the public to review it.
House Speaker Michael Madigan, a Chicago Democrat, said it was one of the most difficult votes his members have had to take because of the stiff opposition mounted by unions, a traditional Democratic ally.
But he and other lawmakers said the vote — while painful — was necessary.
"I don't take any joy in this action today," said Rep. Elaine Nekritz, a Democrat from the Chicago suburb of Northbrook who is the chairwoman of the House pension committee. "Yet it's the responsible thing to provide a pension system that gives workers retirement security without bankrupting our state."