NEIUPI

Given all of the legislative activity stimulated by the financial status of our pension system, many NEIU employees were interested in what Lee Bridges, a SURS advisor, had to say during his presentation last Thursday. If you were not able to attend the SURS presentation, you will find copies of the handouts distributed by Lee Bridges attached to this email . Allen Shub, associate provost and contract administrator, sent the copies so that all bargaining unit members could review the handouts. Thanks, Allen.

Please share these with other NEIU employees…SURS applies to all state university employees. SURS (State University Retirement System)

Money Purchase Factor Change Fact Sheet

Retire: Who…Me?

The Presidents and Chancellors of the Illinois Public Universities have sent the attached letter to Governor Quinn. The letter addresses Senate Bill 512 on pension reform. Follow the link below:

Letter to Governor Quinn

If you have been concerned about the fate of our pensions, here’s the latest from the Springfield State Journal-Register…

Springfield’s lawmakers said Wednesday they do not think a bill revamping pensions for current state employees will be called for a vote during the remaining three days of the veto session.

Appearing before The State Journal-Register editorial board, Sen. Larry Bomke, R-Springfield, and Reps. Raymond Poe, R-Springfield, and Rich Brauer, R-Petersburg, also said they might consider a borrowing plan for the state if the money could be repaid in less than a year and Gov. Pat Quinn specifies exactly how the borrowed money will be spent.

The General Assembly is taking a week off before returning Tuesday for the final three days of the veto session.

Read more at the State Journal-Register…

Ed Hunt, our former NEIU chapter president, forwarded the following pension info to us:

This is from the SUAA fall board meeting a couple of weeks ago. Most people, including legislators, do not understand the flaws in the plan to push everyone into a 401(k). Illinois could end up in a worse situation with all retirees forced into Social Security and the state forced to make back payments into the system.

“Bill Mabe, Executive Director of the State University Retirement System (SURS) was the luncheon speaker. He addressed the current state of the pension system and noted that the system was funded for the current fiscal year. Payments of 81.7 million dollars were to be made to the System each month. However, the full payments were not being made but he has been told that they would catch up to the full payment amount owed to the system.

Among the problems faced by the System is simple demographics. The number of applicants (retirees) has doubled over the last 10 years, benefits have increased, but the number of active members (employees) has not increased and salaries have not increased enough to offset the number of those retiring.

Mr. Mabe discussed the four pension reform working groups which have been working over the summer and continue working to address the funding problem. He has been testifying at their sessions and believes that the members of the groups have come away from the meetings much more aware of the issues. He has pointed out that SB 512 does not save money in the long run and does not address the current unfunded liability. For example, he states that money required of the Defined Contribution plan (401 (k) type plan) costs significantly more to operate than the current system, would not allow the State to defer payments to the pension fund as it does now, and would take away money used to support the other pension plans. He also noted that he did not think the alternative plans would meet the Social Security standards for exemption from Social Security. Thus, Social Security officials would start demanding payroll taxes at some point. Those taxes would be due from the first day the covered plan took effect so there could be years of back payroll taxes due. He also noted that many part-time workers might receive small pensions but the pension would cause the offset and WEP provisions of Social Security to take effect, reducing the Social Security benefit awarded more than the pension was worth.”

As many of you know the state legislature has entered its veto session. An agenda item that has the potential to affect all NEIU employees is the bill to alter our pension benefits. I’ve included an article from the State Journal Register below that describes the Cross bill which has been gaining support. I’ve emphasized (turned it red) a brief summary of the Cross bill.

Illinois House Minority Leader Tom Cross, R-Oswego, said he will be ready to call a bill to set up a three-tiered pension system for state workers during the second week of the legislature’s veto session, which starts Nov. 8.

But demonstrations against Cross’ bill, among other employee funding issues, resulted in the Statehouse being closed for about 10 minutes Wednesday as thousands of union members packed the rotunda.
Cross said the Civic Committee of the Commercial Club of Chicago, a group of the city’s top CEOs, has brokered a deal in which House Republicans would provide 30 votes for the pension bill, Senate Bill 512, and House Democrats would provide another 30. Sixty votes are needed for legislation to pass the House.
“We have 30,” Cross said.

The Senate is another story. Senate President John Cullerton, D-Chicago, says the pension bill is unconstitutional, although he has not ruled out allowing a vote in his chamber.

3 options
The bill would offer current teachers, university employees and state workers three pension options: Stay in the current system but pay significantly more, go into a second tier for workers hired after Jan. 1 that has reduced benefits or choose a 401(k)-style defined contribution plan.

Read more at the State Journal Register…