Emanuel's plan to fix Chicago pension problem clears hurdle

April 2, 2014 (CHICAGO)

State lawmakers in Springfield advanced the mayor's plan to reform two city pension funds. Emanuel would not rule out more property tax increases to address the remaining systems.

"I have a responsibility to live up to what I pledged in the campaign. We can no longer run away from this issue," said Emanuel.

But the mayor avoided a yes or no answer to the question: will more property tax increases be needed to resolve the large and severely underfunded police and firefighter pension systems?

"We're working through the issues to get people the security they need in a responsible way," said Emanuel.

In Springfield, the Illinois House Pensions Committee gave initial approval to the mayor's plan to replenish the Chicago's municipal and laborer's pension funds.

"Clearly, these are local pension systems that are in distress," said House Speaker Michael Madigan.

Among its provisions, the bill would allow Chicago property taxes to be increased, city worker contributions to rise in the next five years by nearly 30% and retiree cost of living increases to be reduced.

"This bill would be a sweeping diminishment in the value of their retiree benefit," said John Cameron, AFSCME Council 31.

If passed by state lawmakers and signed by the governor, Chicago aldermen would vote on the money.

"It will be solely up to the city council to determine whether they need to increase property taxes to make their payment," said Madigan.

"We're not at the point of a vote yet and what I want to do is gather more information to see how this is going to hit people," said Ald. John Arena, 45th Ward.

Back in Chicago, the mayor repeated his vow not to depend solely on taxpayers to resolve pension deficits. Still, he would not rule out additional property taxes when police and firefighter settlements are negotiated.

"I can't tell people something I don't know because we don't know that yet," said Emanuel.

On Tuesday, union officials demanded the mayor consider new taxes on luxury services, financial transactions and wealthy individuals as opposed to homeowners. Emanuel said Wednesday he's willing to listen to new ways to raise revenue.

Copyright © 2023 WLS-TV. All Rights Reserved.