GOP to Illinois State Leaders: There Will Be No Federal Pension Bailout‏

This morning, Chief Deputy Whip Peter Roskam (IL-06), 8 House GOP Committee Chairs, and the entire Illinois GOP Delegation sent a letter to Illinois’ legislative leaders and Gov. Quinn in advance of next week’s Veto Session. Gov. Quinn wrote in his FY 2012 Budget earlier this year that his Administration was considering “seeking a federal guarantee of the debt” for Illinois’ $85 billion unfunded pension liability.

They write, “we urge you to seize the opportunity to appropriately reform the State’s public pension systems to address their massive unfunded liabilities,” but “we can say with clarity: there will be no legislative bailouts from the U.S. House of Representatives.”

Roskam was joined by the Illinois GOP congressional delegation and Appropriations Chairman Hal Rogers, Budget Chairman Paul Ryan, Education & Workforce Chairman John Kline, Energy & Commerce Chairman Fred Upton, Financial Services Chairman Spencer Bachus, Judiciary Chairman Lamar Smith, Oversight Chairman Darrell Issa and Ways & Means Chairman Dave Camp.

Gov. Quinn’s Budget:
“While the pension reform of 2010 improved the situation by decreasing future liabilities—and certainly the economic recovery improved net assets for the pension funds—significant longterm improvements will come only from additional pension reforms, refinancing the liability and seeking a federal guarantee of the debt, or increasing the annual required state contributions.” (Governor Pat Quinn, FY 2012 Operating Budget, Page 2-7)

Letter to Illinois leaders Cullerton, Radogno, Madigan, and Cross (cc’ed to Gov. Quinn):

October 17, 2011

The Honorable John Cullerton
Senate President
327 Capitol Building
Springfield, IL 62706

Senate Republican Leader
309A Capitol Building
Springfield, IL 62706

The Honorable Michael Madigan
Speaker
300 Capitol Building
Springfield, IL 62706

The Honorable Tom Cross
House Republican Leader
316 Capitol Building
Springfield, IL 62706

Text of Letter

Dear President Cullerton, Speaker Madigan, Leader Radogno, and Leader Cross,

As you prepare for the upcoming veto session, we urge you to seize the opportunity to appropriately reform the State’s public pension systems to address their massive unfunded liabilities – and to do so by your own means.

We can say with clarity: there will be no legislative bailouts from the U.S. House of Representatives. The federal government is already borrowing over 40 cents of every dollar it spends – a sad reality House Republicans are working to correct. Given that incredible fiscal weight, and the pressures facing many other States in our Union, the federal government cannot be expected to take on these additional obligations.

With that said, the need for pension reform is as strong as ever. As you know, the Illinois public employee pension plans have $85 billion in unfunded liabilities. The cost of waiting is even greater as the unfunded liability hole grows with each day of inaction. Bold necessary reforms will take a strong commitment by State leaders to fix the problem. Yet, with the problem growing worse daily, now is the opportunity for true pension reform.

Some in the State may expect the federal government to provide the remedy. Governor Quinn, addressing the State’s massive unfunded pension liabilities in his Fiscal Year 2012 budget proposal, included “seeking a federal guarantee of the [state’s] debt” as an option to help Illinois’ long-term solvency. Again, let us be clear: there will not be any legislative bailouts from the U.S. House of Representatives.

Reform is necessary because the alternatives are potentially catastrophic. The State is already suffering under the weight of higher borrowing costs because of credit rating downgrades, which if left unabated could risk future financing. The threat of higher taxes looms large, and that contributes to an uncertainty for employers that dissuades greater investment in job creation and economic growth.

For the sake of the Illinois taxpayer, we urge you to meet the challenge of the day and enact true reform of the Illinois pension system. There will not be a federal remedy, and so the solution must come from within the State of Illinois.

Sincerely,

Peter Roskam
Chief Deputy Majority Whip

Dave Camp
Chairman, Committee on Ways and Means

Hal Rogers
Chairman, Committee on Appropriations

Paul Ryan
Chairman, Committee on the Budget

Lamar Smith
Chairman, Committee on the Judiciary

Darrell Issa
Chairman, Committee on Oversight and Government Reform

Fred Upton
Chairman, Committee on Energy and Commerce

John Kline
Chairman, Committee on Education and the Workforce

Spencer Bachus
Chairman, Committee on Financial Services

Judy Biggert
Member of Congress

Bob Dold
Member of Congress

Randy Hultgren
Member of Congress

Tim Johnson
Member of Congress

Adam Kinzinger
Member of Congress

Don Manzullo
Member of Congress

Bobby Schilling
Member of Congress

Aaron Schock
Member of Congress

John Shimkus
Member of Congress

Joe Walsh
Member of Congress

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