AP Interview: Governor says Illinois shouldn't have pension overhaul backup before courts rule

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CHICAGO — Gov. Pat Quinn argued Friday that it makes no sense to develop a contingency plan to solve Illinois' pension crisis despite urgent financial difficulties and signals the landmark law signed by the Chicago Democrat in 2013 could be found unconstitutional.

In a wide-ranging interview with The Associated Press, Quinn said he'd like to get guidance from the courts before proceeding with another route.

"My father ... told me, 'Don't take an aspirin until you get a headache.' And I think that's a very good rule to follow in life," Quinn explained. "You don't exactly help your position before the court if you say, 'Well I've got a plan B out here, maybe you could take that instead' ... That's a very bad strategic position to take if you fervently believe that the law," is constitutional.

Quinn's comments came as he faces a tough Nov. 4 re-election challenge from Republican businessman Bruce Rauner. The matchup is expected to be one of the competitive and expensive governor's races nationwide. Rauner, a venture capitalist from Winnetka, opposes the pension law Quinn signed last year and says it doesn't go far enough.

Illinois' roughly $100 billion shortfall in funding employee retirement benefits is considered the worst pension crisis in the nation. For years, Illinois lawmakers and governors skipped or shorted payments to their state's five pension systems. After years of debate, lawmakers approved a plan that cuts benefits for most employees and retirees, which supporters say will fully fund the pension systems by 2044. Originally projected to save $160 billion over 30 years, Quinn's office later reduced estimates citing market changes, noting the plan will save the state about $145 billion in the time frame.

But unions sued over the law, saying it violates the Illinois Constitution.

In a separate case, the Illinois Supreme Court ruled in July that a law requiring retirees to pay more for health insurance was unconstitutional. The decision centered on the constitution's strong protections for retirement benefits, leaving many to question the fate of the state's pension overhaul and possible future credit downgrades. That month Standard & Poor's Ratings Services changed its outlook from "developing" to "negative" on Illinois' A-minus rating, citing the ruling as a reason.

Quinn, an attorney, said each court case is unique. He noted Illinois Attorney General Lisa Madigan's comments that arguments in the two cases are different and believes that the July opinion won't affect the pension overhaul ruling.

"You don't presume the judges will preside one way or another," he said, adding that if the courts rule the pension plan unconstitutional Illinois wouldn't be starting from scratch. "We spent years on this issue. We know the parameters."

Senate President John Cullerton, a Chicago Democrat, had floated another approach supporters said had a better chance of passing constitutional muster. It proposed giving workers a choice in benefits they'd receive upon retirement. But Quinn said Cullerton eventually supported the overhaul that's now law.

Rauner has said that Quinn's pension overhaul didn't go far enough.

He has proposed freezing the current pension accounts and moving employees to a 401 (k)-style retirement system. Under that plan, workers would keep the benefits they've earned so far. But going forward they would assume more of the risk for ensuring they have money for retirement — a plan Rauner says is fairer and similar to what most private-sector workers have.


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