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Fri May 2, 2014
Motion Filed To Put Pension Law On Hold
Originally published on Fri May 2, 2014 4:54 pm
A court is being asked to prevent any aspect of Illinois' pension overhaul from taking effect, until it's decided whether the law is constitutional. A motion was filed Friday in Sangamon County Court.
State employees, teachers and university and community college workers who will see their pensions reduced under the law passed late last year have plenty of gripes: many will have to work more years for a smaller pension. Various lawsuits are seeking to declare it unconstitutional.
But while that's being decided, the State University Annuitants Association has filed a motion to put the law on hold, in part because it's basically forcing the hand of people who are eligible to retire.
These workers can escape some of the pension reductions if they quit before July. But once someone retires, there's no going back.
The filing argues that "misinformation and confusion" surrounding the pension law is widespread.
And with State University Retirement System overwhelmed with members seeking counseling, people are having to make these decisions without "the benefit of full information." It says many workers may be compelled to retire on the mere chance the law would be upheld.
Already, there are reports of higher-than-usual university workers retiring -- according to SURS, as many as 17,000 are eligible.
"My hope is that by filing this motion, we'll get some information out to people, and they can hold off a little bit," says Aaron Maduff, the SUAA's attorney. "We have lots of people who are concerned, many who are confused, many who recognize that if they don't act now and the law is upheld ... are in a position of losing a lot of money, and they are simply going to retire because they can't take the chance."
Though the motion is specific to SURS members, a stay would likely be effective for all affected public employees.
The motion does make reference to what even the pension overhaul's backers admit was a "mistake" in the pension law: basically, because a provision affecting what's known as the Money Purchase Calculation, that applies only to members of the State University Retirement System (but not the other state pension funds, which don't use that formula) cited the wrong year, some university employees stand to lose big chunks of money.
A couple of measures have been filed to correct this technicality (Sen. Chapin Rose, R-Mahomet has filed SB2005 and Rep. Chad Hays, R-Danville is sponsor of HB6225), though there has been no other action and there are those who are skeptical about re-opening the pension law to make even minor changes. But time is running short, as university workers need to make their retirement decisions before July 1.
The State University Annuitant's Association's director, Linda Brookhart, says she's still hopeful the General Assembly will pass that as soon as possible. But she says there are other, overriding issues. So even if the mistake is fixed, she says the entire law should still be put on hold.
Brookhart says the "mass exodus" or university and will hurt the quality of higher education in Illinois.
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