SAN JOSE, Calif., March 25, 2016 – “Leaders who take on pension reform know it is difficult work. In Chicago, Mayor Rahm Emanuel’s reform efforts were dealt a setback yesterday by the Illinois Supreme Court’s decision to strike down the city’s pension plans. This decision highlights just how difficult it is to achieve retirement security for public sector workers. Even when government and union leaders came together and agreed on a path forward, their work was swept aside by justices who will one day each receive a public pension. Retirees, workers and taxpayers are all worse off with this decision.
“When Chicago’s pension plans were reformed in 2014, the city had agreed to higher funding if the growth in pension liabilities was slowed. Now, with this decision, the burden falls to the next generation of Chicago taxpayers who will face much greater bills for today’s pension debt. The Illinois Constitution says nothing about required funding levels, yet this court decision now imposes that on all Illinois governments.
“Over the last eight years, more than 45 states and numerous local governments have instituted some form of pension reform, which many times included increasing contributions and reducing benefits. There have been more than 18 state court decisions dealing with pension reforms by state or local governments, and more than 75 percent of those affirmed the pension reform, many times citing the higher public purpose of assuring the funds for essential governmental services. Illinois is one of the few states that has over the past two years ruled against pension reform, including any reduction of benefits or any involuntary increases of contributions by public workers.”