The Talker: Pension plan showdown between Madigan, Cullerton

The Talker: Pension plan showdown between Madigan, Cullerton

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CHICAGO (FOX 32 News) -

20-percent of your state tax dollars go to pay for the pensions of state workers. And all that money is a drop in the bucket compared to what the plan is actually costing.

Pensions have gotten so expensive and have been so underfunded that the system has a $100 billion cash shortfall and is headed for bankruptcy.

The good news is the politicians are finally getting serious about doing something, but there's disagreement about what to do.

State senators passed a plan Thursday put forth by Senate President John Cullerton. It's a totally different plan from one passed earlier in the house, backed by the House Speaker Mike Madigan.

The Madigan plan would fill more of the pension hole, and would fill it faster. State unions do not like it.

The plan would have state workers' pay 2-percent more of their paychecks toward their pensions. It would also reduce the annual increases to their pension checks—the so-called cost-of-living adjustments--and would raise the retirement age for workers currently younger than 45. The plan would save $150 billion over 30 years

The Cullerton plan has the support of a group of unions. His plan would give state workers some options.

They could keep the current cost-of-living raises but give up their state health insurance in retirement or they could keep the retirement health insurance and take a lower cost-of-living adjustment. His plan would save $46 billion over 30 years -- about two-thirds less savings than the Madigan plan.

Hanging over all of this is that the Illinois constitution says pension benefits cannot be diminished. John Cullerton says his plan, legally, is safer.

Mike Madigan says his plan is going to be passed.

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