Ill. Gov: Pension Revamp a 'Political Earthquake'

SPRINGFIELD, Ill. (AP) -- Legislation to trim Illinois pension costs amounts to a ''political earthquake'' that proves state government is willing to tighten its belt as it asks more of taxpayers, Gov. Pat Quinn said Thursday.

The pension overhaul, approved by lawmakers on Wednesday, won't have a major effect on the state's current budget crisis but it will reduce retirement costs by roughly $100 billion in the coming decades.

''It's been talked about by many governors before me. Yesterday was a day of action,'' said Quinn, a Chicago Democrat. ''That was an earthquake ... a political earthquake.''

Illinois faces a record-high budget deficit of roughly $13 billion in the upcoming fiscal year. Officials could reduce that deficit by allocating some of the long-term pension savings to the next budget.

Saying government should be conservative about that financial maneuver, Quinn advocated using just $300 million of the pension savings in the next budget.

The pension legislation also could help Quinn politically.

His Republican opponent, Sen. Bill Brady of Bloomington, opposes a tax increase and argues that the keys to balancing the budget are cutting Medicaid and overhauling government pensions. Quinn has now taken one of those steps himself.

But Quinn may pay a price in union support and campaign donations. Organizations like the Illinois Federation of Teachers and the American Federation of State, County and Municipal Employees strongly oppose the pension overhaul.

The Brady campaign did not immediately return a phone call seeking comment.

Quinn, who favors raising income taxes by one-third, did not directly say the pension cuts were a necessary step before any increase. But he repeatedly said taxpayers want proof that government is willing to make changes before they would consider paying more.

He rejected union complaints that it's unfair to reduce retirement benefits for future employees because of a pension shortfall caused by the state's long failure to make its full contributions to government retirement systems.

''I think it's fair. I think everything's fair,'' Quinn said.

Illinois pension systems are among the most financially troubled in the nation. They have money for benefit checks now, but the amounts promised to future retirees outweighs the systems' assets by roughly $80 billion.

Eventually, taxpayers will have to come up with that money. Already, rapidly increasing annual payments to the pension systems eats up billions of dollars in state revenue each year, leaving little new money for government services.

Quinn did not say when he will sign the legislation, which reduces benefits for future government employees but does not affect payments to current workers.

It would require employees to work until age 67 to qualify for full retirement benefits. It also caps the amount of salary that can be used to calculate benefits and limits the annual growth in benefit checks.