“…One of the most critical actions we can take to save taxpayers’ billions of dollars, while offering state workers a fair deal that protects their retirement, is to enact Constitutional pension reform. Nearly everyone in this Chamber today understands the need for it. We have the worst unfunded pension liability in the nation and because of that nearly one in four dollars we spend in the state budget goes towards making pension payments. Over the last 10 years, we’ve gone from contributing $1.4 billion per year to a scheduled $7.6 billion payment this year.
“Over the summer, our administration developed a pension plan that would provide more than $2 billion in relief to cities, counties, universities and school districts, in addition to the state. And while it remains my hope that the General Assembly is interested in providing more comprehensive help to every community, we cannot wait any longer to help the state.
“So as a first step toward bipartisan compromise, President Cullerton and I have agreed to support his pension proposal that will save $1 billion/year from four of the state pension plans. I have instructed Administration attorneys to work with the Senate President’s staff to finalize language as soon as possible. When they do, I urge both chambers to pass it without delay…” (Rauner).
“On its face, the Pension Protection Clause is absolute and contains no exceptions: ‘Membership in any pension or retirement system of the State, any unit of local government or school district, or any agency or instrumentality thereof, shall be an enforceable contractual relationship, the benefits of which shall not be diminished or impaired.’ See Ill. Constitution, Art. XIII, § 5.
“The Pension Protection Clause does two distinct things. First, it deems membership in State and certain other public pension systems to be a contractual relationship with the employee that is ‘enforceable’ by the courts. Id. Second, it restricts legislative power to modify the benefits of that contractual relationship by mandating that such benefits ‘shall not be diminished or impaired.’ Id. That second provision has independent significance and must be given effect (from Brief of ISEA RSEA Heaton and Harrison Plaintiffs-Appellees, Opening Argument against State’s Sovereign Powers).
“[Rauner’s plan] would diminish public pension benefits in disregard of that constitutional limitation on legislative power. [Rauner] seeks to justify [his plan] on the ground that it will save the State [1 billion dollars a year]. According to [Rauner’s plan], those billions of dollars will come from the pockets of [public sector employees and retirees].
“That particular method of managing the State's finances is expressly prohibited by our State's Constitution. This appeal thus raises an issue of fundamental importance: the primacy of the Illinois Constitution over considerations of political expediency…
“The Pension Protection Clause was specifically designed to prohibit the diminishment of pension benefits based on precisely the claim of fiscal necessity that [Rauner/Cullerton] now advance.
“[The Courts have] repeatedly recognized that the Pension Protection Clause means what it says, [most recently in the Illinois Supreme Court ruling on May 8, 2015]...
“[T]he Clause is a valid limitation on the General Assembly's authority. Like other constitutional limits on legislative power, it cannot be overcome by [Rauner’s] claim of fiscal necessity.
“In the final analysis…, the Illinois Supreme Court upheld the promise of the Pension Protection Clause and, with it, the supremacy of the Illinois Constitution over [any future] legislation, however... politically expedient, that exceeds the constitutional bounds of legislative power…” (Illinois Pension Litigation Brief, February 20,2015).