The Illinois Senate passed what it says is a balanced budget yesterday.
The Illinois House is poised to do the same today.
The Governor says he will sign it.
Everyone down in Springfield is patting each other on the back for their hard work. Passing on time is a relatively new thing for them.
In recent years they have had a difficult time passing a budget at all.
Things move slowly in Springpatch.
It took them 37 years after the deadline to pass the Equal Rights Amendment.
Like nearly all of the Illinois legislators who did or will vote on it, I have not read the budget bill.
The Trib does report some modest increases in education spending.
We will see.
But unlike in past years when Republicans and Democrats railed against each other for using gimmicks to make budgets appear balanced, the spirit of compromise this year allowed lawmakers to see past the plan’s potential shortcomings.
Instead, they congratulated themselves for what Sen. Chapin Rose, a Republican from Mahomet, described as a process that involved “far less partisanship and rancor than I’ve seen in a long time in this building.”
The budget is balanced? Because of our regressive flat income tax, we cannot adequately fund basic services without going into debt. As state governments go, we are among the lowest taxing and lowest spending states in the country.
However, I did read what the Chicago Tribune is reporting about the pension portion of the bill.
Most of the savings would come from voluntary buyout programs for people eligible for state pensions. Former public workers who are vested in the pension system would have the option to completely cash out their pensions at 60 percent of the value, which they could then invest on their own. And employees who are entitled to the state’s most generous benefits packages, which includes a 3 percent compounding cost-of-living adjustment in retirement, would have the option to cash that out for 60 percent of the value and continue with a simple cost-of-living adjustment in their retirement years.
The plan also reduces the amount of end-of-career raises that the state will count toward the portion of pensions it pays from 6 percent to 3 percent. School districts can still award raises above 3 percent, but will have to pay for the resulting pension costs on their own.
This pension offer is the non-solution to the pension debt and liability that State Senate President John Cullerton has been a peddling for years.
Right off the bat: The proposal is unconstitutional. They claim there are savings. “Savings” have to come from somewhere. They can claim savings only if there is a reduction in the pension benefit.
The Illinois Supreme Court has already said a reduction in the pension benefit violates the state’s constitution.
Secondly, most of us who are retired are not stupid.
If the buyout is a reduction in our benefit, why would we take it?
I suppose if I found out that I had a short time left, or I had a major gambling debt and some wise guy had put out a contract on me, I might cash out.
Otherwise I’m sticking with with my pension as it is. And so it every other retiree I know.
They are claiming something like $5 billion in savings from this idea.
Not a chance.
But even if they are right, the current liability is $130 billion.
I know it is crazy to call $5 billion chump change. But compared to the debt that these legislators have created by their decades of shorting the system, that is exactly what it is.
Plus, they just blew that number out of their butts.