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Riders, mount your steeds. Today let us talk about COLA.

June 25, 2012

Graphic: Chicago Reader

I was planning on doing a Monday post on the threats to Illinois teachers’ COLA, the cost of living increases that are a part of our TRS pension benefit.

How lucky then that my friend Glen Brown published Roger Sander’s piece on COLAs on his blog this morning too. Now you now have some important reading to do over your coffee.

Don’t expect to find this over on the IEA website.  They have been amazingly silent on this.

As of this moment there are two big threats to our pension cost of living increases.

Constitutional Amendment 49 that will appear on the November ballot and SB 1673.

Last year the Chicago Reader’s Ben Joravsky called me the Paul Revere of SB 7.

I’m back on my horse. And we have added some more Paul Reveres too. Like Roger and Glen.

We have mounted our steeds. “The attacks on our pension are coming!”

What is SB 1673?

If passed, the bill would require teachers to choose between their present guaranteed 3% cost of living adjustment or their health insurance benefit. Retired teachers in Illinois rely on TRIP, a state retiree health insurance. If we choose to keep TRIP, our cost of living adjustment would be reduced. If we keep our 3% COLA, our TRS creditable earning would be capped and no future salary increases could be used in calculating our retirement benefit.

The view of the political leaders in the state is that by providing a choice, the law will pass constitutional muster. Our state constitution prohibits any act that would diminish or impair our pension benefits. But is this a constitutionally acceptable choice if both options diminish and impair our benefits?

Roger’s article on Glen Brown’s blog gives more details.

The other threat to our pension and COLA is House Joint Resolution Constitutional Amendment 49 (HJRCA49). I will now forever refer to this at Constitutional Amendment 49.

Democratic boss and Speaker Mike Madigan rammed this through the House last Spring and got a 113 to nothing vote to put it on the November ballot.

If you have one of those liberal Democratic state representatives (oh, like Robyn Gabel up on the  north shore), ask them to explain their vote on this for you and me. Let me know what they say.

Constitutional Amendment 49 is a basic bait and switch. The uneducated voter will read that CA49 requires a super majority three-fifths vote of both houses of the General Assembly to enact a benefit increase and they will think, “Who the hell is asking for a benefit increase in a time like this?”

But is the 3% COLA a benefit increase?

The Center for Tax and Budget Accountability says that the language is vague enough that a COLA adjustment could be considered a benefit increase under this law.

At the root of all this is the faulty premise that the source of the pension problem in Illinois is employee benefits.

It is not.

The source of the problem is the failure of the state to meet its funding obligations for the past four decades. It is a failure of revenue. It is not a problem of benefits.

Some will say, “Too bad. That’s water under the bridge.”

But to the retired teacher, a senior with TRS as their only source of income, it is not water under the bridge. It is food on the table, a gas bill paid, a roof over their head and the ability to see their doctor.

And a promise made to them many years ago.

11 Comments leave one →
  1. June 25, 2012 8:41 am

    So if a choice HAS to be made, how does one determine which is the better choice? I will need health insurance for 4 yrs. ?

    • Fred Klonsky permalink*
      June 25, 2012 8:46 am

      Karen,
      That is the point. There is NO good choice. The immediate issue to to organize to kill the bill.

  2. June 25, 2012 8:57 am

    Dear Karen,

    Regarding the diminishment of the COLA, SB 1673 offers public employees no ethical and lawful alternatives except to consent to the General Assembly’s demands by choosing between two illicit choices; second, this is unlawful because of the illegitimacy of the General Assembly’s advantageous attempt to renegotiate a constitutionally-guaranteed contract; third, it is unlawful to induce undue pressure upon public employees to make an unfair choice; fourth, this is an unjust financial enhancement for the General Assembly because it is a breach of contract for public employees to receive less than what the original vested right and benefit guaranteed, and it is also a blatant exploitation of influence to obtain an unwarranted advantage.

    Also see http://teacherpoetmusicianglenbrown.blogspot.com/2012/06/duress-and-few-reminders-about-most.html

  3. Fred Klonsky permalink*
    June 25, 2012 9:23 am

    See. I keep telling you that Glen is much smarter than me.

  4. June 25, 2012 9:38 am

    LOL Thanks Guys…”KILL THE BILL”

  5. June 25, 2012 10:44 am

    Rep. Bill Cunningham told me in a telephone conversation that he supported 49 to put a stop to those who managed to abuse the pension system over the years. When I asked him why those small percentage of individuals should trump the many in the system who are currently retired and living off of much smaller pensions and income he didn’t really have an answer, didn’t care to give me an answer and finished by saying Illinois managed to fully fund the pension system the last three years. I congratulated him for his part in doing what he was REQUIRED to do.

    Interestingly he pointed out to me that what I am asking him – “do not vote to increase employee contribution”, isn’t even what my union is asking for. He also reminded me that his biggest contributors are the unions. It was my most heated discussion with him yet. I am convinced he now sees me asa rogue union member. He’s waiting to do whatever the coalition agrees to.

    IEA has really disarmed us with their agreed upon concessions.

  6. Rich Sasso permalink
    June 25, 2012 5:35 pm

    Okay! Now for the shot heard around the world!

  7. June 25, 2012 8:37 pm

    IEA totally caved in…Sad…At least Dan Montgomery is still fighting..Heard him on the radio today and he was great,,,He said let them figure out how to pay.. They(the politicions got us in this mess) NO way is it the teachers problem…I fear IEA is selling us out..

  8. Marilyn Joyce permalink
    June 26, 2012 5:48 pm

    Karen- I also fear that IEA is seling us out. Where’s the push for new revenues that IEA should be touting???? IEA is a shell of its former self. When I led my local back in the mid 80’s and 90’s- there was never a doubt that IEA represented its members. Not so sure anymore.

  9. Anonymous permalink
    June 27, 2012 7:50 am

    The IEA worked with Madigan and people from CO where these changes were already implemented to sell us down the river..it will take a concerted effort now to let people know who not to vote for in NOV and maybe find someone that can actually represent our side at the table rather than cave on every issue.

  10. Anonymous permalink
    June 29, 2012 9:25 pm

    How do we inform the public? We need all voters to understand that teacher’s need their medical and pay for it from every pension check. Why punish us?

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