When you became a legislator, did you swear to uphold both the U.S. Constitution and the Constitution of the State of Illinois? Do you believe that the contents of SB 512 are in violation of contractual agreements as stated in Article XIII, Section 5 of the Illinois Constitution and Article 1, Section 10 of the Constitution of the United States?
If you were willing to pass SB 512 last May, apparently without thoroughly examining the consequences of the bill, a bill that would “increase taxpayers’ costs of up to $34 billion over 15 years” and, by increasing the Tier-One member contributions lead to “increased money-purchase benefits and higher liabilities for the state to fund,” are you now willing to read, contemplate, debate and analyze the bill in its entirety before voting on it?
If you supported SB 512 as it was proposed last May, one of the many problems with the bill is that "it may have the unintended consequence of forcing Tier-Three members [who are in a defined-contribution savings plan] into social security because of a drafting error in minimum benefits.” Did you know this at the time you supported the bill? Do you understand the ramifications?
If you are still in favor of passing SB 512, note that “it is estimated that Tier-Three benefits will be 30 percent less than Tier-One benefits if the final average salary and service are equal.” If you were a teacher in Illinois, would you choose a Tier-Three benefit plan? Why or why not?
Do you know that members in the current Tier-Two benefit plan (signed into law in April 2010) are paying down the unfunded liability that the state owes and that SB 512 will simply shift a substantial funding burden to teachers without requiring a mandated state funding of the pension system? Do you know that the Tier-Two benefit plan will also be in violation of the Social Security Safe Harbor provision?
Most state contributions, “two-thirds” under current law, are for past underfunding. Do you believe that any form of pension reform should guarantee funding from the state? Why or why not?
If you are in favor of passing SB 512, given Market volatility these past few months, would you be skeptical with only a Tier-Three, defined-contribution savings plan as your only source of income for your retirement?
Do you believe it is sound public policy to follow the leadership of corporate America today, particularly in the financial sector?
Do you realize that migration into a Tier-Three defined-contribution savings plan “will accelerate the state’s obligation to pay down the unfunded liability?”
To move teachers into a 401(k) option will reduce the amount of money available for TRS investments and jeopardize retirement security for teachers. If teachers receive social security, “every school district would have to contribute 6.2 percent per teacher.” Do you believe that all Illinois school districts can afford “an estimated increased cost of approximately $40 million in the first year and more than $2.4 billion over a decade?”
Do you know that the administrative costs of a defined-contribution savings plan are more costly than a defined-benefit pension plan? Are you aware of West Virginia’s shift into a defined-contribution plan in 1991 and the subsequent consequences that state had to address in 2006?
The Civic Committee of the Commercial Club of Chicago wrote SB 512; forty percent of its membership is in financial services. Will some of these members profit from the money transferred into the Tier-Three plan when teachers move from a defined-benefit pension plan to a defined-contribution savings plan?
Do you believe that a defined-contribution savings plan will help retain highly-qualified teachers in Illinois the way a defined-benefit pension plan does?
During the past fiscal year, “TRS paid out $3.9 billion in benefits but collected $6.8 billion in revenue.” Why are you and other state legislators so concerned about the unfunded liability of TRS that will, of course, never come fully due at any time in the future?
Though the state has made some of its required contribution to the pension systems most recently, why do some state legislators not want to address the state’s antiquated revenue system (the most important problem) but rather shift the burden of payment for pensions to local school districts outside of Chicago and, thus, increase property taxes for the citizens of Illinois?
Does it matter to you that retired teachers and their defined-benefit pension create “more than $4 billion in economic activity, including more than 30,000 full-time jobs worth $2.3 billion in wages for non-teachers?” Have you considered the effects that SB 512 would have on the state’s economy as a result of the inevitable destruction of the Tier-One defined-benefit pension plan?
Do you believe that teacher pensions are too generous? The average pension is slightly more than $46,000. (Remember, teachers do not pay into social security and receive little to nothing because of the Windfall Elimination Provision and Government Pension Offset Act). The Teachers' Retirement System is the “only source of income for approximately 80 percent of teachers in retirement.”
Do you believe that a defined-benefit pension plan helps recruit the very best teachers and retain them, thus increasing the overall quality of public education for students in Illinois? Explain.
Most everyone knows that the state has not fully funded the pension systems throughout the decades. Do you and other legislators, (and the general populace) realize that all the people of Illinois have benefited from the programs and services that were funded with the money that was supposed to go into the public pension funds? Is this fair?
Most of us realize that the state has a cash-flow problem, and that it isn’t the fault of pension benefits but due to an economy that was almost completely destroyed by corrupt individuals in the private sector, particularly in the financial sector. Nearly 75 percent of people polled in Illinois believe that a regressive flat-tax rate, where millionaires and billionaires pay the same percentage of income, needs to change into a progressive tax rate. Consider that the wealthy pay even less than the average citizen because of tax breaks. How do you plan to address such a gross injustice?
If you were a public employee in Illinois, what would you honestly say about SB 512? What do you think about Civic Committee of the Commercial Club of Chicago, the Civic Federation, the Illinois Policy Institute, and the Chicago Tribune diatribes?
A writer must “know and have an ever-present consciousness that this world is a world of fools and rogues… tormented with envy, consumed with vanity; selfish, false, cruel, cursed with illusions… He should free himself of all doctrines, theories, etiquettes, politics…” —Ambrose Bierce (1842-1914?). “The nobility of the writer's occupation lies in resisting oppression, thus in accepting isolation” —Albert Camus (1913-1960). “What are you gonna do” —Bertha Brown (1895-1987).
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Thursday, November 3, 2011
Ask Your Legislators These Questions Regarding the So-Called Pension Reform Bill
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