| With an unfunded liability of $100 billion and a funding ratio of roughly 40 percent, Illinois has the worst-funded state pension system in the U.S. The fixed-income market has taken notice: In June two major rating agencies downgraded Illinois bonds. Democratic Governor Pat Quinn has been fighting to get pension reform through the state legislature almost from the day he took the job, in early 2009. “The taxpayers are paying $5 million a day more in pension liability,” says Quinn, 64, who’s running for reelection next year. The governor thought he had a deal this spring, when the Illinois Senate, led by powerful president John Cullerton, approved reform legislation, but a similar bill failed to pass the Illinois House of Representatives. To force a solution during the current legislative session, former tax lawyer Quinn vetoed lawmakers’ pay and threatened to hold fast until a pension bill hit his desk. But Cullerton and house speaker Michael Madigan overturned the veto through the courts; the governor, who’s appealing that ruling, now must rely on the ten-person legislative committee he’s established to hammer out a pension reform deal. “I’m not going to sign anything that’s piecemeal or incomplete,” Quinn says. The committee’s current plan, backed by Cullerton, aims to save about $138 billion over the next 30 years through measures that include shrinking the compounded cost-of-living allowance from 3 percent annually to half of the Consumer Price Index. | |||||
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