Illinois Pension-Overhaul Struck Down by Judge, Heads to State Supreme Court

By Andrew Ujifusa — November 21, 2014 2 min read
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A count Circuit Court judge in Illinois has ruled that a 2013 law that dramatically alters the pension system for public employees is unconstititutional, the Chicago Tribune reported Nov. 21, setting up a decisive showdown over the controversial plan in the Illinois Supreme Court.

Sangamon County Circuit Court Judge John Belz ruled that Senate Bill 1, the legislation signed last year by outgoing Gov. Pat Quinn that changes the pension system for public school teachers and other public employees in the state, was “unconstitutional and void in its entirety.” The Illinois Constitution specifically states that the pension system’s benefits “shall not be impaired or diminished.”

However, the suit is destined to head to the state’s highest court on appeal. Quinn said the law was crucial to reducing the state’s unfunded liabilities for pensions, which at one point last year topped $55.7 billion, and said in a statement reacting to Belz’s ruling: “We’re confident the Illinois Supreme Court will uphold this urgently-needed law that squarely addresses the most pressing fiscal crisis of our time.”

The bill does several things to change the system:

• It increases the retirement age for state workers younger than 46 on a graduated scale—every year a teacher is under the age of 46 adds another four months to that teacher’s minimum retirement age.

• It caps the increases in cost-of-living adjustments.

• Most pension matters are excluded from collective bargaining.

After the bill passed, the We Are One Illinois coalition, consisting of several labor unions including the Illinois Federation of Teachers, quickly sued to overturn it as unconstitutional. The coalition has called the law tantamount to stealing retired workers’ money, as illusrated in its tweet reacting to Belz’s ruling—note hashtag:

I wrote about the pension law earlier this year and how it was playing out in the governor’s race, in which Quinn was defeated by GOP business executive Bruce Rauner. Although Quinn, a Democrat, had received endorsements from several unions in his ultimately unsuccessful re-election campaign, it’s not clear if their support was as full-throated as it might have been, given their opposition to the pension-reform bill, which the governor supported.

A version of this news article first appeared in the State EdWatch blog.