(As state lawmakers consider another try at cutting pension benefits for government workers, we revisit this interview from 2016 with former Illinois Senate attorney Eric Madiar)
Illinois continues to have the worst funded government pension systems of all 50 states. Legislators have taken several swipes at reducing those costs. But so far they’ve all been batted away by the Illinois Supreme Court.
In a series of opinions, the justices have said the Illinois Constitution means what it says it does: that pension benefits "shall not be diminished or impaired.” But the constitution also says something else: that "membership in a pension system shall be an enforceable contractual relationship.” And there are people who see that language as an opening.
Among them is Eric Madiar. He’s an attorney, lobbyist, consultant, and former chief legal counsel to Illinois Senate President John Cullerton. He’s also one of Illinois’ foremost experts on state pension laws, and recently wrote an article, “Illinois Public Pensions: Where to from Here?” (PDF), published in Chicago-Kent College of Law’s Illinois Public Employee Relations Report.
His “consideration” model is premised on the idea that any salary increases Illinois offers to employees do not have to be pensionable. In exchange for giving up automatic pension increases in retirement — guaranteed at 3 percent, compounded annually — Madiar’s plan would promise employees that all future salary increases would be pensionable. In the alternative, employees can keep the 3 percent increases, but their pensionable salary would be locked in at its present rate, forevermore.
“You may not like the fact that the employer has that power,” Madiar says. “You may point to the fact that the state has not exercised that right in the past as somehow saying that the power doesn’t exist, (but) that’s just not true from a legal standpoint.”Brian Mackey interviews lawyer Eric Madiar about his "consideration" framework for cutting Illinois government pension benefits.
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