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As progressive tax debate starts, some push for constitutional pension change

Illinois Watchdog.Org

Tuesday, February 5, 2019  |  Article  |  By Greg Bishop

Pensions (70) , Taxes, Graduated/Progressive
Some at the statehouse want a constitutional amendment to change how the state taxes income, while others want to amend the constitution’s pension protection clause to change pensions for state employees.

State Rep. Jay Hoffman, D-Swansea, said Gov. J.B. Pritzker expects quick action to get the graduated income tax question to voters.

“The governor has made it very clear that he would like to see on the ballot in 2020 a constitutional amendment regarding a fair tax, make sure that people [making] over a million a year would pay their fair share,” Hoffman said.

While state Sen. Don Harmon, D-Oak Park, has filed Senate Joint Resolution Constitutional Amendment 1, the measure does not include tax rates.

Harmon’s proposed change would strike out the language that the state’s income tax “shall be at a nongraduated rate” and replace it with “a fair tax where lower rates apply to lower income levels and higher rates apply to higher income levels.”

State Sen. Dan McConchie, R-Hawthorn Woods, said there’s still no talk about rates. He said what is known is Illinois doesn’t have the money to pay pensions.

“The way that the state Supreme Court has ruled on pensions, it has provided every incentive for public sector unions just to put the metal to the floor and get as much as they can because it can never be rolled back, it can never be taken away," McConchie said. "Some sort of change to the constitution is really necessary to get our pensions under control.”

A constitutional amendment filed in the previous General Assembly would have asked voters to repeal the constitutional provision regarding diminishment or impairment of benefits, but it died in the House Rules Committee early last month.

An amendment to change the state constitution’s pension protection clause is expected to be filed in this session, but more than 18 months out from the 2020 election, one still has not been filed.

"I think the pension reform is a more difficult issue because of the rulings of the Supreme Court," Hoffman said. "I think the courts would probably not look fairly on that either. They could essentially rule that the unconstitutional changes are unconstitutional."

Hoffman said there are limits to how many amendments there can be in front of voters in 2020.

“There's always going to be, I believe, a push to try and make sure that whatever is on the ballot in 2020 is something of significance as opposed to something that just sort of takes up space,” Hoffman said.

McConchie said pension costs are taking up a growing part of the state's spending.

“And that limits our ability to be able to take care of our roads, build our parks, really kind of expand some of the government services we do need and take care of people that really can’t take care of themselves,” McConchie said. “[Pension costs have] been really crowding out the other things we need to do in this state.”

Voters would get the final say on any change to the state's constitution.