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State Lawmakers Fail To Pass Pension Reform Before Deadline

UPDATED 06/01/12 12:52 p.m.

SPRINGFIELD, Ill. (CBS) -- Gov. Pat Quinn is promising not to give up the fight for pension reform, after lawmakers failed to get a bill passed before the deadline of midnight Thursday night.

As CBS 2's Susanna Song reports, the failure to reform the state's public pension systems is a huge setback for Quinn, who has been pushing for pension reform.

LISTEN: WBBM Newsradio's Dave Dahl reports


But in the end, he could not get the support of House Democrats, and the bill was never called up for a vote in the House.

Quinn has made it clear that inaction on pension reform is not a choice, and that the state absolutely needs to reform the system.

Thus, as WBBM Newsradio's Dave Dahl reports, Quinn said Friday that state lawmakers can expect to spend at least a day or two this summer back at the Capitol in the interest of reaching an agreement.

Despite the lack of success so far to reform public pension systems, Quinn says an agreement could be close. He will meet with the four state legislative leaders next week.

"I really feel that all four leaders feel, as I do, that this is imperative. It must be done. And it must be done in a way that is right for Illinois today, and for 30 years to come. So we need to make sure that we have everyone singing out of that hymnbook when it comes to the final agreement," Quinn said Friday morning.

Lawrence Msall, whose Civic Federation has been sounding the alarm bells about the cost of the pension crisis, says it just got even more expensive.

Currently, "it's in the hundreds of millions of dollars, and as time goes on it will approach billions of dollars," he told CBS 2's Jay Levine.

Both Democrats and Republicans agreed that the current system is unsustainable. They says too many state dollars have been pumped into the retirement funds.

But things started to unravel in Springfield when Democratic House Speaker Michael Madigan (D-Chicago) asked to shift pension costs for teachers from state to school districts in the suburbs and downstate.

The Chicago Public Schools is the only school district in the state that currently pays the employer's portion of teacher pensions through local tax dollars. All other public school districts rely on state funding to pay for employer contributions to teacher pensions.

But Republicans and some downstate Democrats had scoffed at shifting pension costs to local school districts, arguing it would place too much of a burden for the schools, and force huge property tax increases in those areas.

Because of that, the provision was dropped, and as a result, Madigan refused to support the revised bill.

In the end, there were not enough House Democrats in favor, and talks collapsed.

With the failure to get anything passed, Rep. Elaine Nekritz (D-Northbrook), the chair of the House Personnel and Pensions Committee, says dismal times are ahead.

"The pension payment increase for the existing systems, since we were unable to address that this year, will be probably another $800 million – which would again exceed, if we had the same revenue increase we had this year of $750 million – we're again looking at every penny going into the pensions systems," Nekritz said. "That's how dire this is."

Quinn says in the coming weeks, he will meet with other legislators to come up with a pension reform agreement. Rep. Jack Franks (D-Woodstock) says the governor should not delay.

"Let's not lose the momentum," Franks said. "We need to do this. We've heard from the bond houses. The governor told this that if we didn't get this done, he was going to keep us. He ought to keep his word. We need to get this done. I think we're much closer than he knows."

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