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Chances For Pension Reform By Midnight Deadline Appear Slim

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Illinois General Assembly

The Illinois General Assembly has a deadline of midnight Thursday night to strike a final deal on pension reform. (Credit: CBS)

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Updated 05/31/12 – 6:15 p.m.

SPRINGFIELD, Ill. (CBS) — The chances of making major reforms to the state’s public pension systems appear to be dead in Springfield, at least for now.

CBS 2 Chief Correspondent Jay Levine reports Gov. Pat Quinn has asked the Republicans who are now sponsoring the proposal not to call it for a vote on the House floor, and Republican lawmakers were meeting behind closed doors early Thursday evening to decide whether or not they will do so.

The Illinois Senate approved its own version of pension reform, but in the House, Quinn failed to round up enough Democratic votes to pass the pension plan, after convincing House Speaker Mike Madigan (D-Chicago) to drop a controversial proposal to shift the burden for paying the state’s share of teacher pensions to suburban and downstate school districts.

The governor said he would work with lawmakers over the summer to make another attempt at pension reform.

Madigan had wanted to have suburban and downstate school districts gradually begin paying the employer’s share of teachers pensions, as is already done at the Chicago Public Schools.

The Chicago Public Schools is the only school district in the state that currently pays the employer’s portion of teacher pensions through local tax dollars. All other public school districts rely on state funding to pay for employer contributions to teacher pensions.

But Republicans and some downstate Democrats had scoffed at shifting pension costs to local school districts, arguing it would place too much of a burden for the schools, and force huge property tax increases in those areas.

When Madigan agreed to drop that proposal, he handed off the pension plan to House Republican Leader Tom Cross (R-Oswego), who couldn’t round up enough Republican votes to pass the plan without help from the majority Democrats.

Cross told the House Pension Committee earlier in the day, “I feel like, for those of you that practice law, that I’m the partner or the associate that was given a huge file the night before, and said ‘Go try this case for me.’”

With Madigan sitting on the sidelines as Quinn and Cross tried to round up enough votes, the pension reform plan stalled, and appeared to be dead early Thursday evening.

“I think that the future of pension reform tonight is in peril,” said Cook County Commissioner and former state lawmaker John Fritchey, who was in Springfield to try to help push for major pension reform. “I think something will get done, ultimately. … I think it’s going to be a matter of how much is enough, and do you let perfect be the enemy of good.”

As it stands, the pension reform plan would give current state employees and retirees a choice on pensions.

One option would be keeping their current annual cost-of-living increases, but lose guaranteed health care coverage and not have future pay raises count toward their pension. The other option would be taking smaller cost-of-living adjustments, while keeping guaranteed health insurance, and having future pay hikes count toward pension calculations.

Fritchey said that didn’t appear to be enough to keep the Democrats on board, after dropping the teacher pension shift they supported.

“I think the Democrats are saying that, if we’re going to do pension reform, let’s do as much as we can, and let’s do it right, and they felt that they had that proposal on the table, up until yesterday,” Fritchey said.

The pension plan had passed out of the House Pension Committee early Thursday, with all four Democrats on the panel voting for it, even though they slammed the plan and criticized Cross throughout the hearing.

LISTEN: WBBM Newsradio’s Dave Dahl reports

State Rep. Karen May (D-Highwood) told Cross, “With all due respect to your position and your title, you could have called meetings at any time with any one person, and I think they would have come to your office.”

“I certainly take it with all the respect I think it’s given,” Cross said.

With pension reform now stalled, the question is what happens next?

Quinn has used every ounce of energy, and every bit of political muscle he has to try to win over enough Democrats to pass the pension plan, but didn’t succeed.

The governor plans to reconvene his pension working group sometime in the summer in hopes of bringing a new plan up for a vote during a special session in the summer.

With only a few hours left until the midnight deadline to pass pension reform with a simple majority vote in the General Assembly, prospects appeared slim of a last-hour compromise averting the need for a summer session, when a 60 percent majority will be needed to pass immediate pension changes.

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