Treasurer calls for pension change

By Jamey Dunn

State Treasurer Dan Rutherford joined the list of Illinois politicians calling for changes to pension benefits for current state employees.

Rutherford, who left the Illinois Senate for the treasurer’s office, said he thinks the “biggest sticking points” in negotiations among lawmakers this session are workers’ compensation reform and whether they can cut back on retirement benefits for current employees.

House Speaker Michael Madigan and Minority Leader Tom Cross agree that lawmakers could alter future benefits for state employees. as long as they left untouched ones earned up to the date of the change. Senate President John Cullerton said he thinks such a plan would be unconstitutional and released a detailed legal opinion from his top staff lawyer that backed up his case. However, he has said he would not block a bill that would changed the system from a Senate vote, saying the ultimate decision is up to the Illinois Supreme Court.

Rutherford said he thinks that if employees were given the choice to stay in a system that offers guaranteed benefits — savings would come from requiring that employees make larger contributions— a change would pass legal muster. He added that it is time to test the concept in the courts.“It should be litigated. For years and years, we’ve [said] ‘oh it’s unconstitutional.' Litigate it. Until we do it, nobody’s going to really know. “

While Rutherford, a Republican, said he does not support Gov. Pat Quinn’s plan to borrow $8.75 billion to pay off the backlog of bills, he said he would consider short-term borrowing, especially if it would help the state capture federal funds.

“I’m not going to be a ‘no’ because I happen to be of a different party [than the governor.] I am going to be ‘let’s make this thing work.’ And if I don’t agree you, I’m going to be respectful, and we’re going to close the door, and we’re going to talk about it. And I feel very comfortable in my relationship right now with the governor and his budget people on what we can or cannot do as the state treasurer to help bring this around,” he said.

Quinn recently proposed $2 billion in borrowing, about half of which would be used to capture $750 million in Medicaid matching funds. Although Quinn has said such a plan would require legislative approval, Rutherford said he has been in talks with the governor’s budget office on alternative borrowing ideas to bring in the Medicaid funds.