Illinois Teamsters Track Public Employee Pension Proposals
AUDIO: Local 700 President-Elect Addresses Members in Springfield
State lawmakers head back to Springfield on Jan. 10, 2012, but Illinois Teamster leaders are already aiming to combat any return to the irresponsible pension proposals that threatened public employees this year.
Union members successfully put the brakes on Senate Bill 512 from its introduction in the spring through veto session in the fall. The legislation, sponsored by House Republican Leader Tom Cross, is the most deliberate measure yet by the legislature to deflect its failure to make required contributions to pension systems and unilaterally change existing pension benefits for current public employees.
“The only reason we’re facing this pension crisis is because Illinois lawmakers have habitually skipped or shorted payments they owe to workers,” said William P. Logan, Teamsters Local 700 President-Elect. “Public employees pay their fair share, year after year. We refuse to let the State of Illinois steal even more money from police officers, firefighters, court clerks, caregivers and public servants.”
Local 700, which represents approximately 13,000 public employees statewide, has encouraged members throughout the year to contact state representatives and oppose the legislation. Logan also joined members and supporters in Springfield in October during a We Are One rally sponsored by the Illinois AFL-CIO. Local 700 Recording Secretary-Elect Michael Melone, Tom Wilcox of the Cook County Sheriff’s Department and multiple Local 700 stewards also joined members during the rally.
Local 700 Secretary-Treasurer-Elect Becky Strzechowski echoed Logan’s charge to Teamsters to raise their voice and stay involved.
“All it takes is every member making one phone call,” said Strzechowski. “It will equal thousands of calls clogging the phone lines of state legislators. It’s truly the best way each of us can make a difference.”
In April 2010, lawmakers quickly passed pension-reform legislation to reduce benefits for all public employees hired after Jan. 1, 2011. The sweeping changes for new hires include a higher retirement age, lengthier requirements for vesting in all state systems, caps on pensionable income, lower survivor benefits and broader calculations for determining a worker’s final annual salary.
Like the legislation for new hires, Senate Bill 512 would affect all public employees contributing to the state’s five pension systems, as well as all Chicago and Cook County funds. Should legislators resurrect the bill next year, public employees could face an election on where to keep their pension contributions.
The bill, if passed, would force workers to choose one of three options:
• Significantly increase employee contributions to maintain current benefits. Eight percent contributions made by most current public employees would jump as high as 13.75 percent each year.
• Receive dramatically smaller benefits with reduced contributions and a higher retirement age. Employees must retire at 67 to receive their full, amended benefits, or sacrifice 30 percent of their package to retire at 62. Worker contributions would average seven percent.
• Freeze all pension contributions to-date and manage a 401(k) retirement plan. Vested public employees would keep any pension benefits already earned, but begin contributing to a 401(k)-style plan. Contributions from workers and the state would face the same risks as other market investments.
“Keeping members as informed as possible about these dangerous proposals ensured Senate Bill 512 died on the table,” said Logan. “This year’s battle may be over, but the war is raging on. Teamsters everywhere have to stay involved if we’re going to be successful in 2012. We need to overwhelm our representatives in Springfield, Cook County and Chicago and tell them to kill this bill forever.”
In addition to opposing the current proposals, Teamster leaders are challenging the constitutionality of such pension reform. The Illinois Constitution states that membership in a public pension system is an enforceable, contractual relationship, “the benefits of which may not be diminished or impaired.”
“Even if the state forces workers to select their own pension benefits through an electoral process, public employees’ benefits would still ultimately be diminished,” said Strzechowski. “The state can blur the line as much as it wants, but the fact remains that pension reform is unfair to workers who both serve and pay into the system faithfully.”
Illinois’ current unfunded liability to its pension systems is approximately $80 billion. While the state operates on an annual budget of approximately $30 billion in general funds, its pension contributions per year may soon exceed $6 billion, or 20 percent of its total operating costs.
“On average, a public employee today earns an annual pension of just $25,000,” said Logan. “Most public employees are not eligible for Social Security. Most began working for the county and state to receive that pension, to earn enough benefits to support their families. No matter what else we do as union members, we cannot allow Illinois to settle its egregious financial debts on the backs of these hardworking families.”
CLICK HERE to download Facts About Public Pensions
Teamsters are urged to share the attached talking points with state representatives and oppose public employee pension reform in Illinois. Lawmakers can be contacted year-round in their district offices, or in Springfield during the upcoming spring session.
Teamsters can also join the We Are One campaign and contact their state representatives directly by calling toll-free at (888) 412-6570.
CLICK HERE to find and contact your legislator today.
Teamsters Local 700 is an affiliate of Teamsters Joint Council 25, which represents more than 100,000 hardworking men and women throughout Illinois and northwest Indiana.
