Two more Illinois retiree associations have joined the legal fray against the state's pension reform law, filing lawsuits on Thursday against the law's constitutionality.
The Illinois State Employees Association Retirees and Retired State Employees Association of Illinois both filed suit in Sangamon County, calling for the circuit court to strike down the portion of the law that reduces automatic cost-of-living adjustments for retirees of the state-run pension systems.
Both associations are also asking the court to set up an escrow fund for the difference in benefits retirees would receive under the new law that takes effect June 1, 2014.
The Illinois Constitution states pension benefits “shall not be diminished or impaired.”
Rudy Kink Jr., executive director of the ISEA, said he thinks the lawsuits will be combined, along with any other potential lawsuits from retiree groups. The Illinois Retired Teachers Association filed a lawsuit Dec. 27 challenging the constitutionality of the law. Mr. Kink added the courts could decide to look at two separate issues, one pertaining to active participants and one to retirees.
“Basically, our lawsuit is dealing with the automatic increases … and its direct conflict with the Constitution,” Mr. Kink said in a telephone interview.
The ISEA, which represents about 6,000 retirees, filed suit naming plaintiffs from the four pension funds affected — the $40.8 billion Illinois Teachers' Retirement System, $16 billion Illinois State Universities Retirement System, $12.9 billion Illinois State Employees' Retirement System and the $49 million Illinois General Assembly Retirement System.
The RSEA filed on behalf of the 9,000 retirees it represents in Illinois SERS.
“In addition to the RSEA, the complaint names four retirees as class plaintiffs representing over 60,000 retirees in a class action against these same defendants,” the RSEA said in a statement. “There is also a subclass named of the more than 10,000 state workers who purchased extra service credits and took early retirement in 2002 and other years.”
“The complaint demonstrates not only that the General Assembly has violated the Constitution, but has ignored its own statutes in using money owed to SERS and other pension systems to fund daily operations of state government,” said Bruce Strom, RSEA president, in the statement.
