Akst: ‘Pension reform’ at NIU
“Crisis” is a word closely associated with public pensions in Illinois, and the emotional level of a Wednesday forum on pensions at Northern Illinois University left little doubt that people are worried and angry.
Several hundred people, mostly NIU employees and retirees, gathered in the Carl Sandburg Auditorium of the Holmes Student Center for blamestorming and advocacy of various approaches.
State Sen. Dave Syverson, R-Rockford, and state Reps. Mike Fortner, R-West Chicago, and also a physics professor at NIU, Bob Pritchard, R-Hinckley, and Tom Demmer, R-Dixon, sat at a lonely table on stage. With them were Steve Cunningham, NIU vice president for administration, and Jim Lockard of the NIU Annuitants Association.
The meeting revealed some ugly truths:
• Many people think House Speaker Mike Madigan should be … um … punished.
• Our situation was decades in the making.
• Just because it’s a gathering of aging university folks doesn’t mean it can’t get rowdy. The first person to pose a question to the panel used profanity.
Syverson, who said that as early as 1995 it was evident (to him, at least) that the way Illinois funds its pension system is “a Bernie Madoff Ponzi scheme,” noted that “the reality is that there is no painless solution.” Demmer agreed, saying that Illinois has the lowest credit rating of any state, that the system continues to put Illinois at a disadvantage in the credit market, and that we still have $6 billion in unpaid bills, even though Illinois brings in more revenue than it ever has.
Fortner said the problem needs to be looked at as two separate problems. One is the $100 billion unfunded liability, “and then there’s the issue of sustainability,” he said, meaning how to keep the system functioning and fair while repaying the debt. He advocated dedicating revenues from bonds, as they mature, to the pension system.
“This is no different than if you have a car payment as well as a home mortgage,” Fortner said. “And when that car payment was done, rather than take the money and go on vacation somewhere, you say, ‘No, I’m going to take those same payments I was making and put it toward the mortgage.’ ”
The legislators said they consistently vote against budgets that don’t fully fund the pension system. One attendee called them “well-behaving members of a gang of thieves.”
Cunningham reiterated that university presidents and chancellors around the state had endorsed a so-called “six-step plan.” That plan was published in March by the University of Illinois’s Institute of Government and Public Affairs and is available here (igpa.uillinois.edu/system/files/Six-Simple-Steps-for-Reforming-SURS.pdf).
If the six-step plan is adopted, Cunningham said, it wouldn’t have to be 100 percent funded; 85 percent funding would be “more than adequate.”
“The key is to have in place a funding plan that is reliable, that is predictable,” he said.
Of a gathering full of painful statistics, Cunningham shared one I had not heard before. In the past four years, NIU has experienced a 42 percent turnover. Sixty percent of that turnover, he said, pertained to “mid-career separation.”
That is, our best people find better deals elsewhere.
• Jason Akst teaches journalism and public relations at Northern Illinois University. You can reach him at email@example.com or follow him on Twitter (@jasonakst).