Gov. Quinn signs Chicago pension bill

CHICAGO (WLS) -- Governor Pat Quinn signed the Chicago pension reform bill Monday that will cut benefits and raise the retirement age for many workers, but it left open the question of property tax increases.

There was no bill signing ceremony, no press statements from the governor. The legislation clears the way for the city to raise property taxes, but Mayor Rahm Emanuel says that won't happen for at least a year.

The bill signed by the governor affects nearly 57,000 city workers and retirees whose pensions are underfunded by more than $9 billion.

"It means a step in the right direction for the city of Chicago," said Laurence Msall, The Civic Federation. "It buys them more time. It's not a panacea. It's not a perfect bill, but it's much better than where we were."

To close the pension shortfall, city workers will have to contribute more and retired workers will get a smaller cost of living increase.

The city, in turn, must make additional annual payments totaling $250 million over a five-year period.

"This is a significant step forward in meeting our obligations to our workers, so they will have a retirement check they can rely on," Emanuel said.

For Governor Quinn, the bill had become a political hot potato.

An early version of the bill featured a property tax increase for Chicago homeowners, flying in the face of the governor's election year pledge of no new property taxes.

Though the governor's signature means the city can raise revenue however it wants, Mayor Emanuel Monday promised no property tax hike for at least a year.

"Today we now have a path forward, which is essential for the city. And we're going to do it in a responsible way," he said.

"It's all about politics," said ABC7 political analyst Laura Washington. "It's all about getting past the next election, Quinn's election in November, Rahm Emanuel's election in February. They don't want any property taxes. This delays it, kicks the can down the road."

This pension reform plan has some union support but others are vowing a legal challenge.

"I don't yet know exactly how the lawsuits will work out, but I can promise you that we will fight for our constitutional rights and rights of our members," said Chicago Teachers Union Vice President Jesse Sharkey.

This legislation does not deal with the underfunded police, fire, and teachers pensions, which are seen as the next challenge. In a statement, Republican gubernatorial candidate Bruce Rauner said he would have vetoed the bill and accused the governor of breaking his promise on property taxes.