State considers borrowing for pension payment

May 25, 2010 (SPRINGFIELD)

The various House committees that considered spending reductions rejected most of them, including a plan to cut $300 million from K-12 education and another $100 million from aid to state universities.

"Our young people deserve better. We just should not do that to them," said State Rep. Monique Davis, (D) Chicago.

"My belief is that if we're not paying the bills, it doesn't do any good to promise the funding," said State Rep. Elaine Nekritz, (D) Des Plaines.

The executive committee would not change free health insurance for state retirees nor would it support reducing the mileage reimbursement for state lawmakers and employees from 50 to 39 cents a mile.

"Some of the members of the General Assembly aren't ready to make tough decisions and I think that they're just not," said State Rep. Sara Feigenholtz, (D) Chicago.

The lack of appetite for cuts has intensified the effort to borrow money to make the state's nearly $4 billion pension payment due in July. Angling for the three-fifths majority required to borrow, the governor and House Speaker Michael Madigan amended their bill to offer some reluctant Republicans construction projects in their home districts.

"The day of trying to buy people off, pay to play politics in this state are over. Why do have to continue to borrow to get more money to spend," said State Rep. Tom Cross, (R) House minority leader.

If the Republicans hold the line against loans, a simple majority of Democrats could vote to forego the pension payment until early next year. But they could pay a steep price in long-term interest.

"When it comes to borrowing for the pensions, there is no question that is the fiscally responsible, prudent way to go," said State Rep. Barbara Flynn Currie, (D) House majority leader.

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