Gov. Pat Quinn has signed into law a landmark overhaul aimed at fixing Illinois' nearly $100 billion pension crisis.
“Illinois is moving forward,” Quinn said in a statement. “This is a serious solution to address the most dire fiscal challenge of our time. ... Working together, we will continue to build a brighter future for the people of Illinois.”
Quinn said the state will adopt an actuarially sound funding schedule under the new law that requires "level payments and achieves 100 percent funding no later than the end of fiscal year 2044."
The law reducing retirement benefits for state employees takes effect in June, but court challenges are expected. Several unions have called the benefit cuts unconstitutional.
"Litigation is inevitable, and I hope that the courts issue an expedited ruling as to the constitutionality of the legislation," Illinois Treasurer Dan Rutherford said. "The sooner the better, so we can move our great state forward."
Illinois' unfunded pension system is considered the worst in the nation after lawmakers skipped or shorted payments for years.
The legislation was unveiled last week and is expected to save $160 billion over three decades.
Among other things, the plan signed into law Thursday pushes back the retirement age on a sliding scale for those 45 and younger. It also caps the salary on which a pension benefit is based and lowers the employee contribution.
“The bill would not have passed without me," House Speaker Michael Madigan said. "I was convinced that standing fast for substantial savings, clear intent and an end to unaffordable annual raises would result in a sound plan that will meet all constitutional challenges."
Retirees who worked for the state fear the deal will seriously cut their monthly income and are upset with the overhaul.
"We put in a certain amount, and they're supposed to match it," said Gloria Smith Armstrong, a nurse for 29 years. "Well we've done that, but they haven't. So now they're saying they want to take our money to cover what they didn't put in."
Dan Montgomery of the Illinois Federation of Teachers said they will move forward with litigation as soon as possible.
"It's the triumph of politics over the rule of law. Unnecessary, we think it's illegal, and we think it's a slap in the face to hundreds of thousands of teachers and public workers," Montgomery said.