Treasurer Encouraged By State Budget Talks

SPRINGFIELD, Ill. (CBS) — Illinois State Treasurer Dan Rutherford said Tuesday that he’s encouraged by the atmosphere around the Capitol this year as budget negotiations heat up.

But Rutherford also cautioned that more issues, such as workers compensation and pension reform, must still be addressed.

LISTEN: Newsradio 780’s Alex Degman reports

Rutherford said he can’t remember a time when House Speaker Mike Madigan (D-Chicago) and Minority Leader Tom Cross (R-Oswego) have worked together so cooperatively.

“I see them when they’re talking through an agreement on what they envision the revenue projections to be, an agreement in regards to doing something to the public pension programs,” Rutherford said. “I see that as a positive sign.”

Rutherford said any pension reforms would have to change benefits for new state employees. But he believes it is constitutional to alter benefits for current employees, if they’re given a choice in a two-tiered system, but any benefits received before a new law takes effect would be untouchable.

He would call for a new pension system to be litigated immediately, up to the Supreme Court if necessary, so any future constitutional challenges would be quashed.

Rutherford said he’s had several positive budget conversations with the governor, and he said he won’t be an automatic “no” just because he’s from a different political party. The treasurer’s approval, along with that of Illinois State Comptroller Judy Baar Topinka, would be required for certain short-term borrowing measures.

  • Jim

    Let’s get the pension reform completed ASAP!


    You can not change a legal contract for the people receiving pensions already. But you could create an excise tax on their pensions. It would have to be taken out at the time they are issued the check to be able to keep the money in Illinois. It could be similar to the way the Federal Government treats Social Security. The Federal government has concluded that an average worker has only contributed 15% of the pension benefits so they tax up to 85% of what is given. Illinois can figure out the same equation and it might be 90% and in some cases 100% taxable. The tax could be tiered based on how much they receive. If they receive 60,000 to 80,000 they pay 5% tax, 80,000 to 100,000 they pay 10% tax, 100,000 to 200,000 they can pay 20% tax, 200,000 and up they can pay 30% or something like this. Illinois would take it out of their payment before it is issued because some of these recipients have and will move out of the state to retire. Since the money is an excise tax the money could go back into the pension plan to help pay for their fellow government workers. This would include School and Government employees. Any one receiving a pension that originates from tax dollars either income or property taxes in the state would be subject to the tax. This is a possible solution instead of taxing the people of Illinois.

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