Gov. Quinn Signs Pension Reform Bill Into Law

Gov. Quinn Signs Pension Reform Bill Into Law

Says new law fulfills his #1 priority as Governor.
CHICAGO - Governor Pat Quinn has signed into law the pension reform bill passed by the legislature on Tuesday, saying the new law will state’s unfunded liability and fully fund the pension system.

“Illinois is moving forward,” Governor Quinn said in a statement. “This is a serious solution to address the most dire fiscal challenge of our time."

But the issue is not really settled yet, as the law faces a certain legal challenge from public employee unions who claim it violates the state Constitution. 

The other aspect of this law is how it will impact Quinn's re-election bid.  The Governor can certainly tout that his number one priority -- passing comprehensive pension reform -- has been achieved, but the Governor is also counting on significant union support to win re-election.

The Governor says the new law will achieve the following:
  • Illinois will adopt an actuarially sound funding schedule that requires level payments and achieves 100 percent funding no later than the end of fiscal year 2044.
  • There will be no reductions in the pension checks going out to current retirees. but future cost of living adjustments will be less.  The law also reduces the amount of money current employees pay into their pensions by one percent.
  • The new law includes caps on pension salaries.

In a conference earlier on Thursday, State Treasurer Dan Rutherford, who is also a Republican candidate for Governor, says he believes the bill has satisified the agencies which rate Illinois' credit, which is currently the lowest rated in the nation.  He does not believe, however, that the bill will withstand a Constitutional challenge.
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