The Illinois Policy Institute has come out in opposition to Reps. Tom Cross' and Elaine Nekritz's pension reform bill (HB3411) and in favor of Rep. Tom Morrison's legislation (HB3303).
According to the Institute the differences are as follows:
PENSION RAMP
HB3411: Keeps pension ramp, so pension contributions increase each and every year.
HB3303: Eliminates pension ramp, so pension contributions remain level.
RETIREMENT CONTROL
HB3411: Keeps politicians in control over workers' retirement savings.
HB3303: Empowers workers with control over their own retirement savings.
BENEFIT DESIGN
HB3411: Maintains outdated defined benefit model for current and future workers.
HB3303: Modernizes retirement systems with new defined contribution model for all future work.
INVESTMENT FREEDOM
HB3411:
Puts politician-controlled retirement systems in control of workers'
investment decisions, even for the small defined contribution element.
HB3303: Gives workers full control over their investment decisions for all future retirement savings.
CONTRIBUTIONS
HB3411: Forces current workers to contribute more of their money to the failed pension plans.
HB3303:
Liberates workers from contributing to the failed pension plans and
instead gives them full control over their future contributions.
BALANCING PRIORITIES
HB3411: Prioritizes pensions above all else, including education, health care and public safety.
HB3303:
Reduces the pension crowd-out of core services by eliminating pension
ramp, making sure state pension contributions gradually consume a
smaller and smaller share of the overall budget each year.
COST SHIFT
HB3411:
Shifts large risks of the defined benefit plan, including investment
returns, life expectancy, etc., to school districts, community colleges
and public universities.
HB3303: Provides accountability by setting
employer contributions at a fixed percentage of payroll, with zero risk
for investment returns, actuarial assumptions or future unfunded
liabilities.
