Gov. Pat Quinn on Friday dropped his appeal of a court ruling that he didn't have the authority to halt lawmaker pay until the Legislature addressed Illinois' $100 billion pension crisis.
Quinn's actions come about a week after the General Assembly approved a plan that supporters say would eliminate the massive unfunded liability and save the state $160 billion over the next three decades, largely by cutting benefits for workers and retirees. Quinn signed the measure Dec. 5, though public-employee unions have promised a legal challenge.
"After inheriting a worst-in-the-nation pension crisis from previous legislatures and previous governors, last week legislators from both parties worked with Governor Quinn to enact a comprehensive pension reform law that will make Illinois stronger," Quinn Spokeswoman Brooke Anderson said. "We're moving forward. Illinois is moving forward."
Quinn used his line-item veto to cut money for legislators' salaries in July, after lawmakers once again failed to agree on how to tackle the unfunded pension liability. He also stopped taking his own paycheck.
House Speaker Michael Madigan and Senate President John Cullerton sued, saying their fellow Chicago Democrat's action was unconstitutional and violated the state's separation of powers. In September a Cook County judge agreed and ordered the comptroller's office to immediately issue checks.
Quinn then appealed to the Illinois Supreme Court. His appeal was pending when the Legislature approved its pension plan last week.
Anderson said Quinn also collected five months of back pay Friday -- more than $70,000 -- that had been sitting in the comptroller's office.
Illinois has the nation's worst-funded public employee retirement systems, largely because lawmakers didn't make or shorted the state's contributions to the funds for decades. The shortfall prompted credit rating agencies to downgrade Illinois' rating to the lowest of any state in the nation. Annual payments to the retirement systems also grew to about one-fifth of general funds budget, siphoning money from social services, schools and other areas.
The deal approved last week reduces the annual cost-of-living increases for retirees and increases the retirement age for workers ages 45 and younger. It also directs more state money into the funds and allows the retirement systems to sue if lawmakers don't make their full payments.
Labor unions say the plan is unfair to workers who made their full contributions to their retirement funds. They also say it violates a provision of the state constitution that says pension benefits may not be diminished.