February 1, 2011

Bills That Could Reduce Our Pensions
Introduced in Illinois General Assembly

This archived story is from February, 2011.
To read more current articles on SURS Legislation, click here here!

The Illinois House of Representatives will consider two bills that could reduce our pensions.

TWO ILLINOIS House Bills, HB 146 and HB 149, have recently captured the attention of many concerned APs and faculty. The proposed changes occur at a time when the State’s pension funds are $70 billion in debt after decades of underfunding by legislatures and governors of both parties. These bills are proposals by members of the Illinois House to address the State's unfunded pension liability. While it is possible that no action will be taken on these bills, such proposals have the potential to result in reduced pension benefits for some employees.

THESE BILLS are stirring controversy over Illinois’ constitutional protection of public pensions. Article 13, Section 5 of the Illinois Constitution (click here) states “Membership in any pension or retirement system of the State, any unit of local government or school district, or any agency or instrumentality thereof, shall be an enforceable contractual relationship, the benefits of which shall not be diminished or impaired.”

APs AND faculty may wish to review the legislation in more detail. The full text of these bills can be found on the Illinois General Assembly website (http://www.ilga.gov/). HB 146 is here, and HB 149 is here.

HB 146 & HB 149
HB 146 would cap pension benefits for all State employees hired before January 1, 2011. The new bill would apply the $106,800 maximum-salary-basis for computing pensions to those workers who retire on or after July 1, 2011.  The reduced benefits already are in effect for State employees hired on or after January 1, 2011 (click here).

ACCORDING TO the SURS Pending Legislation website (click here), “HB 146 - Amends the General Assembly, Illinois Municipal Retirement Fund, State Employees, State Universities, Downstate Teachers, and Judges Articles of the Illinois Pension Code. Caps the highest salary for annuity purposes, final rate of earnings, final average compensation, and final average salary for current members, participants, and participating employees of the affected systems at $106,800, but authorizes that amount to be annually increased by the lesser of 3% or one-half of the annual percentage increase in the consumer price index-u for the 12 months ending with the September preceding each November 1. Requires employee contributions to also be based on these capped amounts.”

HB 149 would require current employees to choose among three retirement plans. They could stay in the current plan, but contribute more to it; they could choose to participate in the second-tier plan that passed last year, which has reduced benefits for those hired after January 1, 2011; or they could participate in a new 401(k)-style Defined Contribution Plan in which the State would match employees’ contributions.

ACCORDING TO the SURS Pending Legislation website (click here), “HB 149 - Amends the Illinois Pension Code. Requires current participants in the State-funded pension and retirement systems to make a one-time, irrevocable election of one of the following: (i) the traditional benefit package under the applicable Article of the Pension Code, (ii) the existing benefit package for new hires, or (iii) a self-managed plan (if made available by the participant's employer). Authorizes persons who became or become participants on or after January 1, 2011 to irrevocably elect either: (i) the benefit package for new hires or (ii) the self-managed plan (if made available by the participant's employer).”
The State Universities Annuitants Association (SUAA) & UIC UNITED 
ACCORDING TO the SUAA website (http://www.suaa.org/), “The State Universities Annuitants Association (SUAA) provides the framework for a unified message dedicated to preserving and protecting a strong public pension system, healthcare benefits, and the general well-being of its membership.

"SUAA ADVOCATES on behalf of all faculty and staff of public universities and community colleges - both retired and current employees - their spouses and survivors, those who are participants and beneficiaries of the State Universities Retirement System.

"AS THE legislative scene is always changing, SUAA sends out periodic announcements to its subscribers.” 

IF YOU would like to receive up-to-date information requiring action, or if you would like to unsubscribe, simply enter your e-mail address via the following link and click "Submit": click here.

PAST PRESIDENT of SUAA Dick Johnson recently stated “SUAA is committed to oppose strongly any diminution of retirement benefits that have been promised to members of the State Universities Retirement System (SURS). This is part of the legislative platform adopted by the membership at its annual meeting this past June. At the top of the list of legislative priorities is to defeat HB 146 that encompasses this attack on retirement benefits. Our highly regarded contract lobbyist, Dick Lockhart, and our Executive Director, Linda Brookhart, are working daily in the corridors of the State Capitol pressing our case. It takes more than this, however. SUAA is a state-wide organization of over 15,000 members in every legislative district in the state. SUAA must carry our case to everyone of the 59 Illinois Senators and the 118 representatives.” 

UIC UNITED is the UIC Chapter of SUAA.  According to the UIC UNITED website (http://www.uic.edu/orgs/suaa/), “The UIC chapter of the State Universities Annuitants Association (SUAA), with over 1,600 members, exists to promote the individual and collective interests and welfare of its members and of all UIC retirees. It endeavors, in association with 48 other chapters in Illinois, to achieve legislation favorable to retirees and to keep members informed of pending legislation that can be of importance to them. In addition, the Chapter disseminates current information on issues of general concern to senior citizens, provides a liaison between retirees and the campus administration, provides opportunities for socializing among members, and works to assure adequate funding of the Illinois State Universities Retirement System (SURS).”

TO JOIN UIC UNITED, click here.

IF YOU have questions about UIC UNITED, please contact Merrill Gassman, President and Webmaster, UIC UNITED – the UIC Chapter of SUAA at mgassman@uic.edu.

TO SEARCH for your districts or officials using your address or zip code, click here.

PLEASE DIRECT any questions to your district officials, SURS, SUAA, or UIC UNITED.  Contact information for each can be found above.  APAC hopes to promote and facilitate campus communications on SURS, but we cannot answer specific questions about these legislative changes.

THANKS TO Dr. Gassman for providing input in the compilation of this article.

1 comment:

  1. Why hasn't the campus said anything about this? They posted something in response to the dialogue about CIC. So we know they are listening. The fact that they choose not to say anything has me concerned.