Leadership Matters - June 2013

Pension reform, cost shift still in limbo The Illinois General Assembly concluded its session May 31 without taking comprehensive action on pension reform, meaning that issue will continue to percolate as we head into the Fall Veto Session and into 2014, which of course also is a gubernatorial election year.

the governor will sign the budget bill as it has been sent to him by the General Assembly. Based on some of the debate surrounding the education budget, we wouldn’t be surprised to see efforts next year to change the way in which public schools are funded. Senate Joint Resolution 32 , sponsored by Sen. Andy Manar (D-Bunker Hill) creates an advisory committee to review the current funding-distribution methods for public education in Illinois and make recommendations for a more fair and adequate funding system by Feb. 1, 2014. The pension reform situation is no clearer now than it was going into the session, except perhaps for the fact that Senate President John Cullerton and most of his caucus stood their ground against SB 1 on the basis that it was unfair and unconstitutional. Of course, the lobbying efforts of the We Are One Illinois labor coalition that supported Cullerton’s SB 2404 were critical to holding off the most draconian of the pension reform plans as SB 1 would have unilaterally raised the retirement age, capped pensionable salaries and drastically reduced the pension COLAs of employees and retirees. Similarly, the efforts of IASA member superintendents and administrators getting the education budget back to at least the FY13 levels. Thanks to those of you who contacted your legislators and even made trips to Springfield to meet with lawmakers. Your voices were heard. Your voices also will be important going forward because the legislative outlook for the rest of this year and the 2014 election year looks every bit as stormy as what we just survived. The budget, the cost shift, pension reform and unfunded mandates will continue to be the main battlegrounds as we fight for top-quality educational opportunities for children in Illinois. had an impact when it came to

Diane Hendren, Chief of Staff / Director of Governmental Relations

Also left for possible future action is the issue of a cost shift for local

school districts as at this time there does not appear to be enough legislative support to force the cost shift onto local school districts or their taxpayers. The underlying reasons go to the fundamentals of the issue as well as the combined efforts of the Illinois School Management Alliance partners. House Speaker Michael Madigan has said he remains intent on passing the state’s normal pension costs to local school districts, similar to a Higher Ed bill, Senate Bill 1687 , which narrowly passed the

House but fell seven votes shy in the Senate. That legislation would have moved the state’s pension costs to universities and community colleges at a rate of ½ percent a year, estimated to be in the range of $18 million beginning in FY15 and continuing to increase by a

similar amount each year until the normal pension costs are completely the responsibility of the higher education schools in the state. The FY 14 budget for PreK-12 public education ended up being essentially the same as for FY13, with level funding for General State Aid, Transportation, Early Childhood and Bilingual Education. While that ended up being much better than the drastic cuts to GSA and Transportation proposed by Governor Pat Quinn, the fact remains that GSA still is being prorated at 89 percent and Transportation at 64 percent. The main part of the education budget bill is in SB 2555 . The hope is that

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