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Rauner's new pension proposal: “Illegal, hypocritical, and stunning"

7/15/2015
Today, the IFT and other unions fought back forcefully against Governor Rauner's new pension reform proposal, which IFT President Dan Montgomery called “illegal, hypocritical, and a stunning display of the Governor’s priorities.”

The House Personnel and Pensions Committee held a subject matter hearing on the proposal, which would slash the constitutionally-guaranteed benefits of teachers, firefighters, police officers, and others by essentially forcing them into detrimental plans. The IFT was among those who testified in vigorous opposition.

Buried deep within the Governor’s 500-page proposal is also language that would eliminate collective bargaining and enact other measures harmful to our members and the communities we serve.

The proposal comes as the Chicago Tribune recently revealed that the Rauner administration is providing a special cash stipend to the new State Superintendent of Education to make up for the lesser Tier II pension benefit he receives as a new state employee.

From the Chicago Tribune:
As a new Illinois employee, state school Superintendent Tony Smith landed in a less lucrative retirement plan designed to control pension costs — the Tier II plan unpopular with educators because it has lower benefits and stricter retirement rules than traditional systems.
 
But unlike his Tier II colleagues, Smith is getting a special perk: The Illinois State Board of Education is giving him a stipend each year, expected to be worth thousands of dollars annually, to make up for his reduced pension.

[…]

"The board ... decided to structure the contract so that the payment to Dr. Smith would be the same amount as if he were a Tier 1 employee," Vanover said in an email to the Tribune.
In light of this outrageous revelation, IFT President Dan Montgomery commented on the Governor’s hypocrisy as lawmakers convened for today’s hearing.
"Beyond the blatant unconstitutionality of the Governor’s proposal, or his sneaky inclusion of an extreme provision to strip away the collective bargaining rights of working people, Illinois teachers are outraged by the hypocrisy of this plan.

“Days ago, we learned that Governor Rauner’s administration provided a special stipend for the state superintendent of education, to make up for the lower Tier II pension benefit he would receive as a new state employee. This supplemental perk is a clear admission that Tier II is grossly inadequate as it stands.  Thousands of Illinois educators receive this very same, insufficient retirement plan, but rather than make them whole as he is doing for his own executives, Rauner is proposing a plan that cuts them more deeply.
 
"This is illegal, hypocritical, and a stunning display of the Governor’s real priorities."
The We Are One Illinois coalition of unions, of which IFT is a lead partner, also issued a strong statement, noting that the Governor’s plan would essentially outlaw collective bargaining rights for public employees and is “both unconstitutional and deceptive.” The bill would prohibit teachers, staff, faculty, first responders, and other public employees from having a say in compensation (including wages, overtime, vacation, and other benefits), working conditions, seniority, and layoffs.
“The provisions that would wipe out union rights for all public service workers are hidden on five pages of his pension proposal. Gov. Rauner neglected to mention the provisions in a news conference where the bill was unveiled. The governor indicated that adoption of the bill was one of his conditions for resolving the current budget impasse.

[…]

"The people of Illinois reject Gov. Rauner's extreme agenda that would strip teachers, police and all public service workers of their basic rights," Illinois AFL-CIO President Michael Carrigan said. "Without the right to bargain, teachers couldn't advocate for better schools and smaller class sizes, nurses couldn't speak out for adequate staff and better care, and first responders couldn't stand up for the tools they need to keep us safe. Meanwhile, wages and benefits for all workers would be driven down. Governor Rauner has the wrong priorities that would hurt our state's middle class and all those struggling to get there."
Read the entire coalition statement here.
 
As you know, in a clear and unanimous decision, the Illinois Supreme Court recently struck down another attempt to cut pension benefits, Senate Bill 1, and stated that the Constitution clearly prohibits benefits from being diminished or impaired.

At a speech to the City Club of Chicago yesterday, Supreme Court Justice Anne Burke said that if Illinois lawmakers are seeking a way to reform pensions, 
“all the Legislature has to do is read what we said and their interpretation. Read the whole decision. Our work is based on written decisions and anybody can read it and interpret it as they wish.”  
LINKS:
•    “Illinois new school superintendent gets special perk for lower pension”
•    We Are One Illinois coalition on constitutionality of Rauner proposal
•    IL Supreme Court Justice Anne Burke on recent ruling and pension reform moving forward
•    Overview of Tier II pension plan
•    Sen. Biss/Rep. Nekritz resolution questioning whether Tier II is compliant with federal law/Social Security
•    Report on “unfair” structure of Tier II plan from TRS Executive Director Dick Ingram

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