Ward Room
Covering Chicago's nine political influencers

Rahm: No Pension Reform? Higher Taxes

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    NEWSLETTERS

    Mayor Rahm Emanuel heads to the Illinois statehouse to lay out a roadmap for retirement security plans. Christian Farr reports. (Published Tuesday, May 8, 2012)

    If the Chicago pension isn't reformed, Chicago would need to raise property taxes by 150 percent, Mayor Rahm Emanuel told the Illinois House of Representatives Committee on Personnel and Pensions.

    Emanuel on Tuesday proposed increasing city workers' retirement age by five years to 67 and increasing employees' contribution over five years. He also suggested suspending automatic cost-of-living adjustments for retirees and suspending city contributions until the pension system is fixed.

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    "I believe being honest with people makes both good policy and good politics," Emanuel told the committee during his first trip to Springfield since taking Chicago office. "We're here today because we didn't level with people in the past. We postponed making choices."

    If reforms aren't made, Emanuel said, taxpayers will have to pay $1.2 billion a year toward city workers' pensions. Chicago school budgets would need to be cut and the average class size would jump to 55 students.

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    "Without pension reform, we'll be forced to mortgage our children's future," he said. 

    While the mayor appears to have support from leaders on both sides of the aisle, some union leaders said he was using scare tactics to push through initiatives that aren't beneficial to public employees.

    "He's coming out strong. He's saying, 'We're going to do this. And we're going to do that,' and he's failing to recognize that there is constitution in Illinois that will prohibit him from doing some of these routes that he wants to take," said Mike Shields, the president of Chicago's police union.

    A statement from American Federation of State, County and Municipal Employees said it is wrong that "retirees should now be forced to bear the lion’s share of the burden for fixing a system damaged by shortsighted politicians and reckless Wall Street speculators."

    But Emanuel said the city has "a unique opportunity to deal with major financial dark cloud hanging over Chicago." He wouldn't name former Mayor Richard Daley in his criticism of the plan.

    This isn't the first of the mayor's dealings in Springfield. He's been known to work the phones (i.e. for Chicago speed cameras) downstate, but this time, he traveled there himself.

    Though the meeting was the only thing on the mayor's Tuesday public schedule, sources said he had an open-ended return to Chicago. Considering there were several other issues on the table, he may have held other private meetings.

    Chicago Teacher's Union President Karen Lewis and other union leaders reportedly were in Springfield last week to meet with Senate President John Cullerton and Speaker of the House Michael Madigan, according to sources familiar with the situation.

    Sources told Ward Room last week that Mayor Rahm Emanuel is working furiously behind the scenes and would like to amend the new SB7 bill - as the teachers union sees it - changing the rules on a strike authorization vote.

    When asked Friday about amending SB7, Emanuel wouldn't answer but said "it's not about the adults, it's about the children."