Gov. Quinn signs pension reform bill
December 30, 2010 (WLS) -- Governor Pat Quinn has signed a law that Mayor Richard Daley says will trigger the largest property tax increase ever in Chicago.
Quinn signed a pension reform bill into law, meaning that cities must contribute more money to help fund pensions for law enforcement officers and firefighters in Illinois.
The governor says the new law is going to stabilize the pension system, but critics warn it will burden taxpayers.
There was no signing ceremony and press conference, just a one-page statement from the governor's office. The bill passed with wide bipartisan support in the general assembly.
Police and fire unions praised Quinn Thursday night.
"This is a very big deal for the members of the Chicago police department and chicago fire department that are currently collecting a pension, those that are earning their pensions now, and for future hires as well," said Chicago Fraternal Order of Police President Mark Donahue.
Leaders of several municipalities, including Chicago, say steep tax hikes are on the way.
In a statement Thursday night, Daley said, "the direct result of the governor's actions will be a massive property tax hike for Chicago residents of at least $550 million, or about a 60 percent increase."
Daley previously said that this would be the largest property tax increase in city history.
The new law forces municipalities to raise contributions to their currently under-funded pension systems. In exchange, benefits will be decreased for officers and firefighters hired on or after January 1st.
The law also pushes back the full benefits retirement age from 50 to 55, limits the maximum salary on which a pension amount is based, and stops the practice of promotions and raises in the last year of service for the purpose of increasing benefits.
"I think that the events that have occurred here in Chicago - the loss of life both in the Chicago police department and Chicago Fire Department - have opened the eyes a little bit of some of those biggest critics," said Donahue.
Quinn echoed that sentiment earlier in the week.
"They volunteer to do dangerous things," said Quinn. "I want to make sure they have a secure retirement and a decent pension."
In a statement Thursday night, the governor's office said reform is the right long-term solution: "Municipalities face the increased challenge of funding pensions. The changes made under Senate Bill 3538 will help ease that burden."
Supporters of the new law say the higher contributions would not have to be funded through property taxes, as Daley has said.
The general assembly is expected to consider additional legislation to address Chicago's budget concerns.
politics, eric horng
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