Gov. Pat Quinn said Saturday that Illinois' massive pension shortfall will grow at a slower pace of $5 million a day, but the Chicago Democrat continued to pressure legislators to solve the problem, saying "we must stop this bleeding."
The daily growth in the state's unfunded liability — the cost of benefits it has promised public employees and retirees — was estimated at $17 million per day for the fiscal year that ends Sunday. Quinn said that number is expected to drop in the next fiscal year in part because the state has made its full pension payment for the past several years. Legislation that curbed pension benefits for newly hired workers also contributed to the decrease.
But in a press release, Quinn said Illinois residents continue to pay "a steep price" for the Legislature's failure to address the $97 billion crisis.
"We must stop this bleeding," he said. "Legislators must work around the clock to put a bill on my desk that erases the pension debt for the greater good of the people of Illinois."
Illinois has the nation's worst state pension crisis, due mostly to years of lawmakers skipping or shorting the annual payment to the state's five public-employee retirement funds. Because of the shortfall, three major credit rating agencies have downgraded Illinois to the lowest credit rating of any state in the nation, and the annual pension payment has grown to about $6 billion — taking money away from areas such as education and public safety.
Yet legislators have been unable to agree on a solution. After ending their regular legislative session in May with the House and Senate at a stalemate over rival plans, lawmakers voted earlier this month to form a bipartisan committee to try to reach a compromise.
Quinn told the group they had until July 9 to come up with a deal, but several members have said that deadline is unrealistic, and the committee is not expected to meet it. Even if they do, an agreement would still have to get the approval of both chambers of the Democrat-controlled Legislature.
The House has supported legislation backed by Speaker Michael Madigan that would cut retirement benefits across the board. The Senate prefers a plan sponsored by Senate President John Cullerton, and drafted in cooperation with labor unions, that gives workers and retirees a choice in benefits. Madigan said his plan would save the state more money, but Cullerton believes his legislation is the only one that would survive a legal challenge.
Meanwhile, the pension problem has become a political issue for Quinn, who has said he will run for re-election in 2014. In recent weeks four candidates have announced they want his job: state Treasurer Dan Rutherford, venture capitalist Bruce Rauner and state Sen. Bill Brady, all Republicans, and Democrat Bill Daley, the former White House chief of staff.
All four candidates have ripped Quinn for what they say is a lack of leadership on the pension issue.
Quinn has pinned the blame squarely on the Legislature, saying he's made pension reform his top priority and that lawmakers now need to "do their job" and send him a bill to sign.
In his statement Saturday, Quinn's office also boasted that his "responsible fiscal policies" have slowed the growth of Illinois' pension debt.