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Legislative session closes with a flurry

June 1, 2011

Seal of the State of IllinoisThe General Assembly closed out its spring session Tuesday night by passing a budget for Fiscal Year 2012, but set aside issues related to pension reform and annuitant health insurance premium changes. Both of those items are expected to be the topic of continued discussion and debate over the summer and are scheduled to be taken up again this fall during the General Assembly’s veto session beginning Oct. 25.

Here is a recap of issues of importance to NIU faculty, staff and students:

FY2012 Budget – The higher education appropriations bill approved by the General Assembly was based on a version drawn up by the House of Representatives; it calls for a 1.15 percent base budget reduction in funding to Illinois public universities.

Cash Flow Crisis Compounded in FY12

As of June 1, 2011, the state owes NIU $42,819,271; with only four weeks remaining in the fiscal year, the state still owes NIU 42 percent of its appropriated operating funds.  In addition, the General Assembly extended the lapse payment period to Dec. 31 to allow the state more time to clear the $8 billion backlog in unpaid obligations.

The new fiscal year begins July 1, 2012 and our cash flow backlog will be compounded almost immediately as unpaid FY12 vouchers pile up in the Comptroller’s office. Our budgetary hole is much deeper on June 1, 2011 than it was one year ago in terms of funds the state still owes NIU as Fiscal Year 2011 concludes.

Pensions – Discussion of major changes to Illinois pension programs for current employees was shelved after SB512 was met with tremendous resistance from employees across the state.   However, proponents of the bill made it clear that this is not the end of the issue.

“We are absolutely committed to reforming Illinois’ public pension system for current employees,” said Speaker Mike Madigan and House Republican Leader Tom Cross in a joint statement. “It must be done to stabilize our systems and address long term financial issues for both the public employee pension systems and state government. We believe passage of legislation addressing this issue is essential to the state’s well being.”

The House leaders pledged hearings over the summer and another attempt at pension reform in the fall veto session.

Annuitant Health Care – A proposal that would have ended free health care for annuitants with 20 or more years of service in the state, was also temporarily shelved. The plan would have instituted a new system under which retirees would be required to pay a percentage of their health insurance costs. It would have established a sliding scale taking into account years of service, age at retirement and the size of the pension collected (as a measure of ability to pay.)  This is another issue that will continue to be discussed throughout the summer with potential action during Veto Session in October.

Capital Bill – Some last minute maneuvering in the Senate, which added $343 million to the amount proposed in the House version, will likely place this bill in limbo until later this fall. That could tie up funding for the next phase of work on the Cole-Stevens complex and planning for a new computer technology building.