Senate Bill 1 is designed to close a $97 billion deficit that hangs over the state’s pension plans. Underfunding for decades has left the pension systems short of what they need.
The bill would require employees to contribute an additional two percent of their earnings to their pensions, delay retirement, and accept smaller cost of living increases. The state also would promise to make its required contribution each year.
“Today the Illinois House of Representatives took the biggest step to date towards restoring fiscal stability to Illinois,” said Illinois Gov. Pat Quinn in a prepared statement. “With the passage of this comprehensive pension reform solution, Illinois is closer than ever to addressing a decades-long problem that is plaguing our economy, our bond rating and the future of our children.”
“In my judgment, this is a critical action that must be taken now,” Madigan said. “It must be taken for future budget making. It must be taken for the fiscal well-being and reputation of the State of Illinois.”
The measure now goes to the Senate.