Local schools and colleges to pay into teacher's pension fund

Madigan outlines pension changes

By WEEK Producer

Madigan outlines pension changes

May 25, 2012 Updated May 25, 2012 at 5:34 PM CDT

SPRINGFIELD, Ill. -- The next big item the General Assembly has to tackle is pension reform and House Speaker Mike Madigan said that will include cost-shifting of pension contributions.

Currently, the state of Illinois pays for teacher pensions in downstate school districts and community colleges.

That, Madigan says, will have to change.

"Local school districts and community colleges and Universities ought to assume the responsibly to make the pension payments for their employees", Madigan said.

"Today the state makes those payments and it's not fair and it's not equitable and it's one of the leading causes of why these systems have fiscal instability".

Madigan said for state workers, the retirement age would NOT be increased, and there would be no employee pension contribution.

But, retiree's pension amounts would no longer be compounded, and employees would be offered a choice of taking a reduced Cost of Living adjustment or not having access to the state's health care plan for retirees.

“We’ve determined that the biggest cost driver that leads to instability in the pension systems is the automatic, compounded COLA (cost of living) adjustment,” Madigan said.

The Speaker expects the General Assembly to finish it's business this session without going into overtime, but the General Assembly will be called into session on Monday, Memorial Day.

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