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Path to Illinois pension reform now even trickier

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SPRINGFIELD, Ill. (AP) — Illinois Gov. Pat Quinn had claimed he was “put on earth” to solve the nation’s worst pension crisis, but the goal eluded him once again as lawmakers adjourned their session without addressing the $100 billion burden on the state’s struggling economy.

On a marathon final day when several other key measures were approved, including a compromise on concealed weapons, lawmakers couldn’t find common ground on an issue that the governor and fellow Democrats who lead the Legislature labeled as the session’s top priority. They even turned aside a relatively minor fix that would have chipped away at the problem by getting state universities and community colleges to pay their own retirement costs.

“I will not stop fighting until pension reform is the law of the land,” Quinn said Friday after the vote. “But … I cannot act alone.”

Even if Quinn or legislative leaders call a special session to force a new vote on pension reform, the task of passing it this year now becomes even tougher. After May 31, it requires a three-fifths majority rather than a simple majority to approve legislation.

Quinn has pushed a pension overhaul for more than a year, even veering into odd territory when he introduced an animated python named “Squeezy” to emphasize the vise grip that growing pension obligations have on other state services.

“The biggest supermajorities in modern history, the biggest issue facing the people of Illinois in a generation and you failed to deliver,” said Sen. Matt Murphy, a Palatine Republican. “… The governor is going to bring Squeezy out again tomorrow because you guys couldn’t figure out how to communicate with a supermajority of the same party on the other side of the building.”

Lawmakers spent the final days of session approving medical marijuana; a deal on hydraulic fracturing, or “fracking;” a method for legalizing the carrying of concealed guns; and a historic expansion of Medicaid, a key part of President Barack Obama’s health care law.

They also sent Quinn a new $35.4 billion general revenue fund budget that avoids cuts to education for the first time in several years. But they had nothing to show for on pensions, legalizing gay marriage or expanding gambling.

Senate President John Cullerton, whose chamber did approve same-sex marriage and a gambling plan, was at a loss to explain where lawmakers can go from here after years of discussing, studying, and railing against the pension crisis.

“I’ve tried everything,” the Chicago Democrat said. “You’re fighting unions and you’re fighting the business community at the same time. And that’s what’s so difficult. I’m trying to thread the needle.”

Cullerton and House Speaker Michael Madigan each had their own pension plans that they passed and sent to the other chamber. Cullerton noted he sponsored the Madigan plan and called it for a vote, but it failed 16-42.

After years of state underfunding and skipped or shorted payments, Illinois’ five public employee retirement systems are about $97 billion short of what’s needed to pay benefits as currently promised. The full annual payment in 2014 will be about $6 billion — nearly one-fifth of the state’s general revenue fund.

If the Legislature doesn’t take action by 2016, the governor’s office estimates the state’s pension payment will be larger than the amount spent on education.

Quinn said afterward he would call legislative leaders together next week to try again to come up with an agreement. Both Cullerton and Madigan also pledged to continue working, despite a stubborn standoff over the issue in recent weeks.

“I don’t think we should take a lack of success today as a reason to give up,” Madigan said.

Leaving town without a resolution on the massive public retirement system crisis means soaring pension payments will continue to put pressure Illinois’ budget. The inaction also could prompt credit rating agencies to further downgrade the state’s credit rating, which already is the lowest of any state in the U.S.

The failure also could pose political problems for Quinn as he eyes a re-election bid. Two members of his party have already said they’re weighing a possible run: Former White House chief of staff Bill Daley and Attorney General Lisa Madigan.

Illinois Treasurer Dan Rutherford, a Republican, was set to announce his bid for 2014 on Sunday.

Associated Press writer Sara Burnett contributed to this report.

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