Pension reform conference committee embraces prexy college plan

Mike Zalewski

By Bob Bong
Southland Savvy

Lawmakers charged with figuring out a solution to the state's growing pension crisis are warming to a proposal promoted by university presidents to provide full funding for the State University Retirement System as a possible framework for the state. 

"The SURS plan is one which we feel might be something all four caucuses could live with," said state Rep. Michael Zalewski (D-23rd), of Riverside, one of the lawmakers named to the Joint Conference Committee by House Speaker Mike Madigan.

"We all sort of agreed that it was something to look at," Zalewski said Monday before the committee held its third meeting.

The SURS Six-Step Plan, as explained by Southern Illinois University president Glenn Poshard, is designed to provide full funding for the state university system in 30 years. The measure would increase employee contributions from 8 percent to 10 percent over four years, adjust the compound COLA for retirees to half of the Consumer Price Index, place new employees into a hybrid pension system that combines defined benefits and defined contributions, change the way to calculate the effective rate of interest used to determine a range of benefits, refunds and service credits set annually by the SURS Board and the State Comptroller, shift the normal pension costs from the state to the universities at a rate of 0.5 percent per year, and ensure that the state and/or universities make their payments into the pension system.

Zalewski said conference committee members like the proposal because it deals with COLA increases "which are the biggest cost driver of the pension crisis."

He said that savings under the SURS proposal would probably fall "somewhere in the middle" between the projected savings of the competing pension reform bills sponsored by Speaker Madigan and Senate President John Cullerton.

Poshard called the SURS plan "shared sacrifice," but said it had the backing of every university in the state.

He said that while crafted for SURS, its main components would go a long way toward creating a solution for the state's other pension systems, including the Teachers Retirement System, the State Employees Retirement System, the General Assembly Retirement System and the Judges Retirement System.

Zalewski said the conference committee was waiting for actuarial reports on the projected savings and that he would have a better idea on when a compromise bill would be available once those reports were received.

"We're working as hard as we can on getting those reports back," he said.

Not fast enough for Gov. Pat Quinn apparently.

The governor, who set July 8 as the deadline for a compromise, said Wednesday he would use his budgetary veto powers to hold back paychecks for state legislators until they come up with a solution to the pension crisis.

Zalewski, a staunch supporter of the Madigan proposal to solve the state's pension crisis, said he was mildly surprised to be named to the conference committee.

"I had been doing a lot of work on pension reform," he said. "Maybe somebody wanted me on the committee because I was familiar with the proposals."