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Bills would repeal Rauner's 3 percent cap

by Beth Camplain | Aug 03, 2018
A second bill to repeal the new 3 percent cap on the state’s pension liability was introduced in Springfield this week.
A second bill to repeal the new 3 percent cap on the state’s pension liability was introduced in Springfield this week. HB 5937, sponsored by Rep. Natalie Phelps-Finnie (D-Harrisburg), would restore the 6 percent salary cap which was in effect prior to the passage of the FY19 budget in May. Governor Rauner refused to sign the budget until the 3 percent cap provision was included. 
A similar bill, SB 3622, was introduced in the Senate last month.
The IFT strongly supports both these bills. This so-called “reform” was intended to address the practice of “pension spiking” in the final years of employment, but it may have the practical impact of limiting final average salary increases to 3 percent for all participants in the Teachers Retirement System (TRS) and State Universities Retirement System (SURS). Since the lower cap took effect, locals and councils have seen employers use the threat of higher pension costs to districts as an excuse to keep wages low across the board.
The governor's harmful cap comes as the state is experiencing a severe teacher shortage, particularly in Southern Illinois. Rather than show that our state is willing to invest in teachers and provide a secure retirement, the cap will worsen the shortage by driving high-quality educators away.
The House and Senate are adjourned until the veto session on November 13, so it is unlikely that any action will be taken before that time. Watch Under the Dome for updates as they become available.


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