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This installment plan is commonly referred to as the pension ramp. Instituted in 1994, the ramp was intended to address years of the state not making their contribution to the pension system and the resulting billion dollar unfunded pension liability, by forcing increased allocations to the pension over time. The reform established a 15 year ramp period, during which the newly mandated contributions Illinois had to make for current and past employees increased in gradual increments. Since these make up payments increased annually, they became knows as the 'pension ramp', that is they 'ramp up' over time.

However, locating the necessary millions in the state budget that are required each year under the pension ramp puts an immense strain on the rest of the budget. If lawmakers stick to the payment schedule they will have to find an additional $721 million for pension when they work on a new state budget next spring. The year after that, the increase for pensions is expected to be $759 million. State pension obligations have the potential to swallow almost all of the natural revenue growth the state can expect and will hamper any effort to do anything beyond paying the pensions.

The truth is, the idea of fully funding the pensions is an illusion. The budget is balanced and pensions fully funded this year- only because the state underfunds other costs. Typically, pensions have been underfunded in order to fund those other costs.

Sadly, Illinois suffers from a structural deficit. Our poorly designed tax system does not grow with the economy, and hence generates less revenue than needed to maintain current public service levels and make the required pension payments from year to year. In fact, the source of Illinois $40.7 billion unfunded pension liability stems from decades of Illinois having to borrow against the pension contribution it owes, simply to maintain public services.

The fact of the matter is that before Illinois can actually 'fully fund' the pension system, they must modernize the state's tax system to comport with today's economy. Only then will funds no longer need to be borrowed against others costs to create the illusion of fully funded systems and a balanced budget.

Illinois must then, eliminate the current pension ramp, which irresponsibly backloads costs and effectively defers the problem to future generations and constrains the states ongoing ability to fund services. Illinois should adopt a flat annual payment amortizing the unfunded liability in equal, annual installments over a period of 40 to 45 years. This will make the obligations far less constrictive of state finances, as the real value of the flat annual payment will decrease over time.

Congress Considers Whether to Impose Collective Bargaining

Introduced by Representative Dale Kildee (D-MI), congress is considering House Resolution. 980, a bill which would establish a national system of collective bargaining for most of the nation's public safety officers, including but not limited to law enforcement officers, firefighters, and other emergency service personal employed by state and local governments.

The impetus behind this bill is the notion that the health and safety of the Nation and the best interests of public safety employer and employees can best be protected by the settlement of issues through the process of collective bargaining. The Federal Government is said to need to encourage conciliation, mediation and voluntary arbitration to aid and encourage employers and the representatives of their employees to reach and maintain agreements concerning rates of pay, hours, and working conditions, and to make all reasonable efforts through negotiations to settle their differences by mutual agreement reached through collective bargaining or by such methods as may be provided for in any applicable agreement for the settlement of disputes. The absence of adequate cooperation between public safety employers and employees is deemed to have implications for the security of employees, impacts the upgrading of police and fire services of local communities, the health and well being of public safety officers, and the morale of the fire and police departments, and can affect interstate and intrastate commerce.

If passed, H.R. 1980 would establish a national collective bargaining system for fire and police personnel, governed by a federal agency called the Federal Labor Relations Authority (FLRA). Not later than 180 days after the enactment of the Act, the FLRA shall make a determination as to whether State law 'substantially provides' for the rights and responsibilities comparable to or greater than 1)granting public safety employees the right to form and join a labor organization which excludes management and supervisory employees, and which is, or seeks to be, recognized as the exclusive bargaining agent for such employees; 2) requiring public safety employers to recognize and agree to bargain with the employees' labor organization 3) providing for bargaining over hours, wages, and term and conditions of employment and 4) making available and interest impasse resolution mechanism, such as fact finding, mediation, arbitration, or comparable procedures.

If a state fails to meet these minimum criterion, the FLRA has the authority to 1) determine the appropriateness of unities for labor organization representation; 2) supervise or conduct elections to determine whether a labor organization has bee selected as an exclusive representative by a voting majority of the employees 3) resolve issues relating to the duty in good faith 4) conduct hearings and resolve complaints of unfair labor practices 5) resolve exceptions to arbitrator's awards 6) protect the right of each employee to form, join, or assist any labor organization, or to refrain from any such activity, freely and without fear of penalty or reprisal, and protect each employee in the exercise of such right and 7) take such other actions as are necessary and appropriate to effectively administer the Act.

It is too early to tell whether H.R. 980 would have a significant impact on Illinois public sector labor relations and/or whether the Illinois General Assembly would have to modify its own local bargaining statutes in order to meet the criteria outline in H.R. 980. However, various public employer organizations, such as the National Public Employer Labor Relations Association (NPELRA), have expressed serious concerns about the practical impact of H.R 980, as well as its ability to pass constitutional muster if ever challenged in a court of law.

On June 5. 2007, labor attorney Theodore Clark, testified on behalf of NPELRA before the House Subcommittee on Health, Employment, Labor and Pensions. During this hearing, Mr. Clark, pointed out that even though the National Labor Relations Act provides for ceding authority to state laws not 'inconsistent' with the provisions of the NLRA, 'the National Labor Relations board has repeatedly refused to cede jurisdiction to the state boards.'

On that basis, Clark speculated, "One could take virtually any of the 38 state statutory provisions providing collective bargaining rights for police officer and/or firefighters and come to the conclusion that there is something in each law that likewise does not meet the 'substantially provides' test."

The House Committee on Labor and Education approved the legislation on June 20, 3007 with an overwhelmingly bipartisan vote of 42-1. The bill passed the full U.S. House of Representative 314-97 (with 20 not voting) on July 17, 2007. When it reached the Senate, the bill was put on the General Calendar, from which it can be brought up at any time. There are indications that the bill has a good chance of passing through the Senate, however less is clear whether the current administration would veto the bill and/or if Congress has the votes to override any such veto.

IRS Will Tax 401 (k) Savings Used to Buy Retiree Health Coverage

Very soon, employees who designate a portion of 401(k) or other saving plan contributions to pay for retiree health care coverage will be taxed on those contributions. In proposed rules published last week, the Internal Revenue Service said such an arrangement is not entitled to tax favored treatment and that such contributions would be included as taxable income to the employee.

Though such arrangements have long been discussed, few employers have implemented them amid informal warning from IRS officials that the arrangements are not entitled to the same tax breaks provided to other benefit plan designs. The attraction to such decisions is obvious: Employees make pretax contributions to 401(k) plans, the money earns tax free interest and then can be pulled out tax free to pay for retiree health care premiums.

However in their proposed rules published in the August 20, 2007 edition of the Federal Register, the IRS says Congress has very 'carefully and strictly limited the ability to prefund' health care benefits on a tax favored basis. Under federal law, employers can designate that up to 25 percent of their contributions to their defined-benefit pension plans be used to fund retiree health benefits, while a portion of assets from overfunded pension plans can be used for the tax-favored funding of retiree health care benefits so long as certain conditions are met.

Furthermore, last year's sweeping pension funding reform law includes a provision through which retired public safety officers can use up to $3,000 a year of their pension benefits to pay for retiree health care premiums on a tax-free basis. So long as the retiree makes such an election and the amount is directly transferred by the plan to an insurer, the retiree will not be taxed on the amount.

According to the IRS, given how specific Congress has been in laying out rules for tax-favored funding of retiree health care benefits, "a broad exclusion permitting a tax-favored treatment of any distribution used to pay accident or health insurance premiums would be inconsistent with this intentional statutory scheme."

Before these proposed regulations are adopted as final regulations, consideration will be given to any written or electronic comments that are submitted to the IRS. A public hearing will take place on December 6, 2007 at the IRS office in Washington D.C.

General Motors and United Auto Workers Strike a Deal; But who does it Benefit?

The United Automobile Workers union and General Motors reached a landmark agreement early on September 26, ending a two day strike. The key provision of the new contract is a deal that would allow G.M to unload $51 billion in retiree health costs into an independent trust administered by the UAW. According to G.M. implementation of the trust would be subject to court approval, as well as a review of G.M.'s accounting for the trust by the Security and Exchange Commission.

The union also agreed to lower wages for some workers, in exchange they won commitments from G.M. to invest in U.S. plants, bonuses and an agreement to hire thousands of temporary workers which will boost UAW membership. Union president, Ron Gettelfinger, said the new contract 'will absolutely protect their jobs and keep jobs from being reduced.'

The U.A.W.'s old agreement with G.M. expired midnight on Sept. 14. Rather than strike immediately, however, the union extended the contract on an hour by hour basis. But on Monday, the U.A.W. struck G.M when it failed to reach agreement by an 11am strike deadline. The strike was sufficient to push the two sides toward an agreement.

G.M.'s key demand was the trust, called a Voluntary Employee Benefit Association or VEBA. The VEBA which would include the union's participation would be the first among the Detroit companies to take full responsibility for coverage for active and retired workers and their families.

Similar trusts could soon follow at the Ford Motor Company and Chrysler LLC. They have pushed hard in contract negotiations for the union to agree to form such trusts, maintaining that their so call legacy costs hinder their ability to compete with Japanese auto companies, whose costs are lower.

Specifics of the funding for the trust are not yet available; however, Mr. Gettelfinger said it would "secure the benefits of our retirees' and every G.M. hourly worker now at the company. He said the fund, which would last for 80 years 'would be solvent' throughout that time.

However, many seem to disagree with Gettelfinger. According to concerned employees VEBA will simply allow G.M. to walk away from retiree health are commitments, and shift all risk.

To understand the basis of such claims, we must ask one question;

What exactly is a VEBA?

On the surface, a Voluntary Employee Benefit Association (VEBA), is nothing more than a federally recognized non profit 501(c)(9) corporations set up to insure that health care, pension, unemployment or other benefits are routinely paid out to workers covered by the trust. According to the non profit monitoring service Guidestar, there are at least 2,700 VEBA's already in existence for union and non union employees, indeed several of them already exist for Big 3- auto companies or major auto part suppliers like Visteon.

However, closer examination of VEBA's lead to real concern. One big problem with the VEBA trusts are that many of them start off underfunded. In fact, business analysts claim that this underfunding is one of the key advantages of a VEBA solution. They point to the success of Goodyear tires in dumping $1.3 billion of retiree health care obligations in favor of a $1 billion lump sum payment into a VEBA in the wake of the settlement of its grueling strike with the Steelworkers in late 2006.

Business analysts predict G.M. may be only willing or able to offer less than $35 billion of the estimated $50 billion that it owes retired workers. Ford was estimated to only be able to put $13 billion of $17 billion, while Chrysler, with mounting financial pressures from its recent buyout by Cerberus, remained unknown in what it is expect to offer.

U.A.W. member's fear that under funding could lead to a simple, grim arithmetic: each dollar shortchanged will presumably translate into a dollar that can't be spent on health care premiums, co-pays, deductibles, or quality of care. Under a VEBA, the remaining costs of maintaining health care benefits will have to be shifted back to the workers themselves. Skyrocketing health care costs or an economic downturn my make an underfunded VEBA even more disastrous for workers.

Moreover, the liability may be more than financial- it may also become political. By taking on the role of health care administrator, the union could be forced into a compromised position, having to potentially limit or cut benefits for the workers it represents.

The Reality of VEBA's

These pitfalls are not merely hypothetical. They have already occurred with disastrous results for workers inside the U.A.W.

Following the signing of a concessionary two-tiered contract in January 2005, workers at Caterpillar found themselves with a bankrupt VEBA. According to the Caterpillar VEBA's 2005 tax filing, the fund paid out $1,350,131 while only having $1,345,186 left in contributions, leaving it owing $4,500.

Retired Caterpillar workers expecting to draw from the fund suffered from the shortfall. They were left to deal with dramatic increases in co-pays, premiums, and deductibles despite previous agreements to protect them.

Fed-up with the inaction of U.A.W. international leadership, members filed a federal class-action lawsuit against Caterpillar in May 2007. Currently, the case is still pending in the courts and in a final twist "now Caterpillar is suing the UAW because they should have prevented retirees from suing the company."

A similar case occurred again at Detroit Diesel. Set up in 1993 to fund retiree benefits, the joint company-and U.A.W. administered fund was exhausted by 2004. Saddled with sudden out-of-pocket health care costs, three Detroit Diesel members turned to the courts in desperation, filing a class action suit in January 2007 in defense of the 1,126 affected retirees and surviving family members.

In certain cases, employers can even raid a VEBA's funds after it has been set up to fund capital expenditures. In 2000, G.M. shifted $1 billion from a VEBA that covered members of the UAW and other unions. G.M. spent $500 million of the $1 billion on investments in Suzuki plants and another $500 million to boost the profits of its financing arm, GMAC.

With these dangers in mind, anti VEBA UAW members are fighting against their implementation. However U.A.W president Mr. Gettelfinger continues to assert their value and safety, even stating he will be "glad to stand up in front of anybody and defend VEBA."

U.S. Houses Takes Stance on Sudan

In response to the burgeoning movement in the United States for states, cities and universities to restrict investments in companies doing business in Sudan, the United States House of Representatives passed House Resolution 180, the Darfur Accountability and Divestment Act of 2007, by an overwhelming majority of 418 to 1.

Sponsored by Representative Barbara Lee (CA-9) and co-sponsored by 130 members of the House of Representatives, the bill directs the Secretary of the Treasury to ensure the publication every six months in the Federal Register of a list of all business who have a direct investment in or are conducting business operations in Sudan's power production, mineral extraction, oil-related, or military equipment industries.

The bill states that it is U.S. policy to support state and local efforts to divest funds from, or restrict investments in, companies that conduct business operations in Sudan and authorizes state or local government divestment in such companies. It prohibits the U.S. government from contracting or renewing a contract for goods or services with a company that is on such list and authorizes the President to waive such prohibition for national security reasons.

In addition the bill states that it is U.S. policy to support any state or local government decision to prohibit state or local government contracting for goods or services with a company that is on such list and authorizes a state or local government to prohibit such contracts.

Illinois is among many states to follow suit with a bill that requires the State funded retirement systems to divest from Sudan. Senate Bill 1169 passed both Houses on May 31, 2007 and was approved by Governor Blagojevich on August 28, 2007. SB 1169 provides that retirement funds shall not transfer or disburse funds to, acquire any bonds, loans, or invest in any entity unless a certifying company certifies to the retirement system that 1) the certifying company has relied on information provided by an independent researching firm that specializes in global security and 2) 100% of the retirement system's assets for which the certifying company provides services or advice have not been invested or reinvested in any forbidden entity at any time 4 months after the effective date. The certifying company shall also make the certification required to a retirement system 6 months after the effective date of the Act and annual thereafter.

Since the government of Sudan relies heavily on foreign investment to fund its military, divestment is deemed an effective strategic move against the crisis. The hope is that the Darfur Accountability and Divestment Act will maximize the impact of divestment on the Sudanese government while minimizing potential harm to both innocent Sudanese civilians and investment returns.

*19 states have adopted divestment policies from Sudan. Twelve of these states have passed the Sudan Divestment Task Force model of targeted Sudan divestment: California, Colorado, Florida, Hawaii, Indiana, Iowa, Kansas, Minnesota, New York, Rhode Island, Texas, and Vermont. Seven of these states have developed state specific methods of Sudan divestment: Arkansas, Connecticut, Illinois, Maine, Maryland, New Jersey, and Oregon.

*18 other states have initiated Sudan divestment campaigns. Seven of these states have targeted Sudan divestment legislation currently introduced: Massachusetts, Michigan, North Carolina, Ohio, Pennsylvania, South Carolina, and Wisconsin. Eleven of these states have campaigns awaiting introduction of legislation or are pursuing Sudan divestment by other means: Arizona, Delaware, Georgia, Idaho, Missouri, Nebraska, Nevada, New Hampshire, New Mexico, Oklahoma, and Tennessee.

*54 universities have adopted divestment polices from Sudan. Beginning with the first university - Harvard- to the most recent- including the University of Minnesota, the University of Illinois and Connecticut College - in a display of grassroots power, students, faculty and administers have united to ensure that their schools make conscionable, genocide-free investments. 47 other universities have initiated campaigns to pursue Sudan divestment policies.

*9 cities have adopted divestment policies from Sudan: Denver; Los Angeles; Miami Beach, Fla.; New Haven, Conn.; Newton , Mass; Philadelphia; Pittsburgh; Providence, RI.; and San Francisco.

*8 countries have initiated targeted Sudan divestment campaigns. International divestment campaigns currently included Australia, Canada, Ireland, Italy, South Africa, Germany, the United States and the United Kingdom.

*5 companies - Roll Royce, Siemens, ABB, CHC Helicopter and Schlumberger - have ceased operations in Sudan or formalized and publicized a plan to do so, or have significantly changed their behavior in the country since the Sudan divestment movement began.

Public Sector Retirement News From Across The Country for Sept. 2007

California

Mayor points finger at Aguirre, wants judge to settle pension dispute

By Matthew T. Hall and Jennifer Vigil

The San Diego Union-Tribune

September 26, 2007

SAN DIEGO -- Mayor Jerry Sanders wants a judge to settle the latest employee-benefit dispute between City Attorney Michael Aguirre and San Diego's pension system.

At issue is the date that San Diego halted several pension and health benefits. Labor contracts eliminating the benefits took effect in July 2005, but the contracts weren't formally codified until this past February. [Read More]

CA Governor Backs Bill on Pension Funding

By Harrision Sheppard

MediaNews Sacramento Bureau

San Jose Mercury News

September 25, 2007

SACRAMENTO - Gov. Arnold Schwarzenegger said Monday that he intends to sign a bill requiring the state's pension funds to divest from companies that do business with the energy and defense sectors of Iran.

Estimates vary on how much money the state funds have invested in companies that do business with Iran, but it could run as high as

$24 billion. Divesting that much stock could cost more than $120 million in taxes, commissions and other expenses. [Read More]

Doolittle term affects pension; But lawmaker denies he's running to raise his retirement benefit.

By David Whitney

Bee Washington Bureau

The Sacramento Bee

September 22, 2007

Washington -- Rep. John Doolittle may have a lot more at stake in the 2008 elections than his reputation. Winning a 10th term also could be worth as much as $16,000 annually on his federal pension. [Read More]

State seeks fix for crisis in pensions; Panel weighs options for $5 billion cost

By Troy Anderson

LA Daily News

September 21, 2007

Alarmed that the annual taxpayer tab for teachers' and state workers' pensions and health benefits has soared from $1 billion to more than $5 billion since 2000, California officials called on Friday for fixes to stem the financial outpouring.

The calls come amid growing concern about California's pension crisis, which has deepened over the past seven years as the average county fund has gone from being flush with cash to being at least 9 percent underfunded. [Read More]

Fund's impact in state gauged; CalPERS investments are tied to 124,000 jobs in California

By Gilbert Chan

Bee Staff Writer

The Sacramento Bee

September 19, 2007

Whether it's backing a trendy Richmond neckwear designer or building loft-style apartments in downtown Sacramento, the investments of California's leading public pension fund inject an estimated $15.1 billion a year into the state economy, according to a new study. [Read More]

CalPERS to use its investment might on government projects.

By Gilbert Chan

Bee Staff Writer

The Sacramento Bee

September 11, 2007

California's deep-pocket public pension fund is poised to invest up to $1.5 billion over the next year in building bridges, power generating plants and other government rebuilding projects. [Read More]

State yields; teacher fund gets millions

By Gilbert Chan

Bee Staff Writer

The Sacramento Bee

September 11, 2007

A four-year skirmish over a skipped payment to a special teacher's retirement fund ended Monday with a $500 million check from the state.

Foreseeing another courtroom loss upon appeal, Gov. Arnold Schwarzenegger agreed to tap the state's $4.1 billion reserve to repay the money owed to the giant California State Teachers' Retirement System. [Read More]

Connecticut

Pension revocation examined

By Angela Carter, Register Staff

New Haven Register

September 21, 2007

NEW HAVEN -- The Board of Aldermen's Finance Committee Thursday decided to collect data from 13 states that have pension revocation laws and from two state officials who have researched such legislation. [Read More]

The Bottom Line: Playing By Its Own Rules

By Judy Ward

PLANSPONSOR

August 2007

A bill that would let Connecticut's state comptroller set aside any or all of the Governmental Accounting Standards Board (GASB) accounting rules got shot down by the state's governor, but the issue may not be over. [Read More]

Denver

DPS weighing pension option; $400 million may be borrowed under new plan

By David Milstead

Rocky Mountain News

September 26, 2007

Denver Public Schools may borrow $400 million, with its buildings as collateral, to pump up its underfunded pension. [Read More]

Denver Public Schools Eye Pension Refinancing to save at least $14 million

By Jeremy P. Meyer

Denver Post Staff Writer

The Denver Post

September 26, 2007

Denver Public Schools wants to refinance the unfunded portion of the pension system to put the district on better financial footing. The move would save DPS between $14 million and $18 million a year, said the district's chief operating officer, Tom Boasberg. [Read More]

Kentucky

Lawyer: Pension changes risky

By Stephenie Steitzer

The Courier-Journal

September 27, 2007

FRANKFORT, Ky. -- A California attorney confirmed in a report this week what some Kentucky officials already suspected -- altering the contract that guarantees retirement benefits to public employees would be hard to defend in court. [Read More]

State workers to pay 5.8 percent more for health benefits

Business First of Louisville

September 12, 2007

State employees in Kentucky will pay 5.8 percent more for their health insurance benefits in 2008, although the benefits themselves will remain unchanged, the state announced Wednesday. [Read More]

Louisiana

Teachers' pension fund posts 19.67 percent return

From Staff Reports

The Shreveport Times

September 16, 2007

The Teachers' Retirement System of Louisiana achieved one of the highest portfolio returns in its history, TRSL Board Chair Sheryl R.

Abshire announced this week in a news release. [Read More]

Michigan

State lawmakers float a first: A tax on health care benefits

By Chris Christoff

Detroit Free Press

September 26, 2007

Lansing -- In a possible first, individuals would pay state income tax on health benefits from their employers under one scenario lawmakers are considering to resolve the state's budget crisis. [Read More]

Minnesota

Mayoral race focuses on retiree healthcare . . . again

by Paul Lundgren

Business North

August 29, 2007

The key issue in Duluth's 2003 mayoral race was a massive unfunded liability for healthcare benefits promised to retired city employees-- then projected to be nearing $200 million. Herb Bergson was elected, promising to solve the crisis. [Read More]

New Hampshire

Report: NH pension tab to soar

By Norma Love

The Associated Press

Union Leader

Sep. 20, 2007

Concord -- Taxpayers will have to pay more to ensure New Hampshire's retirement system keeps its promises to current and future retired state and municipal workers, a new study concludes. [Read More]

New Jersey

State pension fund managers seek profits in volatile market

By Dunstan McNihol

Star-Ledger Staff

The Star Ledger

September 21, 2007

Managers of New Jersey's $81 billion pension fund said yesterday they sidestepped the worst of the fallout from the financial crises that have roiled Wall Street since summer, and are now betting $3 billion that they can profit from the damaged financial markets. [Read More]

Workers protest pension fund being in N.J. hands

BLOOMBERG NEWS SERVICE

Asbury Park Press

September 21, 2007

About 50 New Jersey public union representatives and workers attended a meeting of the state pension board to object to the panel's plan to put at least $9 billion in alternative investments such as hedge funds. [Read More]

Pension funds to boost N.J. companies

By Hugh R. Morley

The Record

September 5, 2007

Short of cash for economic development and desperate to grow the state employee pension fund, New Jersey is seeking to attack both problems with one tool.

The New Jersey Division of Investment, which is responsible for managing the state employees' $80 billion pension portfolio, has created a fund to back New Jersey companies. [Read More]

New York

Under Bloomberg, Budget and Revenues Swell

By Diane Cardwell

The New York Times

September 17, 2007

Mayor Michael R. Bloomberg has promoted himself as a model of fiscal restraint, issuing dire warnings about the slowing economy, recently asking agencies to limit hiring, and even listing "fiscal responsibility" as an interest on his MySpace page.

At the same time, a review of the city's budget since 1980 shows that Mr. Bloomberg has been presiding over one of the greatest expansions of city government since the John V. Lindsay administration, fueled by an extraordinary surge in real estate revenues, both from higher property taxes and transfer taxes from sales. [Read More]

Cuba Could Trip Up New York Divestment Movement

By Jill Gardiner

Staff Reporter of the Sun

New York Sun

September 14, 2007

A push to rid New York State's pension fund of companies invested in nations identified as backers of terrorism could be derailed by America's longtime pariah state: Cuba. [Read More]

AG: Probe of state pension fund will uncover corruption

By Joe Mahoney

NY Daily News

September 13th 2007

Attorney General Andrew Cuomo says New Yorkers will be startled by the extent of the "pay-to-play" culture his expanding probe of state pension fund corruption will uncover. [Read More]

Ohio

Judges' working retirements rile critics

The Columbus Dispatch

September 16, 2007

At age 50, Judge Scott D. VanDerKarr seems too young to be retiring from Franklin County Municipal Court.

But he is not leaving the bench. Unopposed for re-election Nov. 6, VanDerKarr will "retire" in name only before beginning another six-year term. [Read More]

Texas

Bigger bonuses approved for Texas Retirement System investment staff; those who help boost returns at $111 billion fund can qualify for up to $9 million in rewards.

By Robert Elder

Austin American-Statesman

September 14, 2007

Despite warnings of a backlash from educators and lawmakers, a divided Teacher Retirement System board Thursday approved a compensation plan that could pay up to $9 million in bonuses to its investment staff and push the total pay of its investment chief to $904,500. [Read More]

Court decision puts pension fund salaries out of public view

By Robert Elder

Austin American-Statesman

September 12, 2007

The pay of many public pension fund employees has suddenly become a state secret. A court victory by the Houston Municipal Employees Pension System means the compensation of pension fund employees -- the people who manage billions of dollars for public-sector plans -- is no longer available under the Texas Public Information Act. [Read More]

Virginia

Newport News moves to close loophole in benefits

By Sabine Hirschauer

Newport News Daily Press

September 26, 2007

The city took a first step toward overhauling its retirement system by approving changes to its pension plan Tuesday night. In a unanimous vote, the Newport News City Council scaled back the pensions for teachers up to the age of 55. [Read More]

Wisconsin

Schools consider trust fund as retirement funds

By Martin Lundeen

Sentinel Reporter

Burnett County Sentinel [Grantsburg WI]

Sep 26, 2007

GRANTSBURG -- Siren and Grantsburg school boards are facing a common challenge in the near future. By the 2009-10 fiscal year, Wisconsin districts will be required to account for benefits in a manner dictated by the Government Accounting Standards Board (GASB.)

And in light of this common challenge, it was little surprise when both district's meetings shared a common speaker Monday night - Michael Blackburn of Mid America Solutions.

The issue which brought Blackburn before both boards is an upcoming change in the way school districts are required to account for funds paid as benefits. [Read More]

Wyoming

Boomers' retirement challenges system

By Joan Barron

Star-Tribune capital bureau

Casper Star-Tribune

September 10, 2007

CHEYENNE -- The Wyoming Retirement System is in good shape but faces a challenge as baby boomers retire, says a new legislative audit of the system.

"As baby boomers retire, greater numbers of retirees will be relying on plan benefits yet there will be proportionately fewer contributing members," said the Legislative Service Office staff report to the Legislature's Management Audit Committee. [Read More]

Recent Resarch in the Retirement World

Survey of Employer Benefits 2007

By The Kaiser Family Foundation and the Health Research & Educational Trust

According to this recent report, the rising cost of health insurance continues to drive a slow but steady decline in employer sponsored coverage and an increase in the number of uninsured people according to the authors of an annual employer survey.

Premiums are said to have increased 6.1% on average in 2007 - the slowest rate since 1999. However, that figure is more than twice the 2.6% rise in inflation and outstrips the 3.7% boost in workers' earnings. [Read the Full Report]

Social Security Reform; The Nature of the Problem

Issued by The United States Department of Treasury

In this new report issued Monday September 24^th, the Bush administration said that Social Security is facing a $13.6 trillion shortfall in coming years and that delaying reform is not fair to younger workers.

The report states that some combination of benefit cuts and tax increases will need to be considered to permanently fix the funding shortfall. [Read the Full Report]

Promoting Work: Implications of Raising Social Security's Early Retirement Age

By The Center For Retirement Research at Boston College

In this brief the Center for Retirement Research addresses the question of whether today's workers would be able to work longer without unique hardship if the early eligibility age were raised.

There findings include that raising Social Security's early retirement age of 62 would encourage longer work lives, thereby improving retirement security, and that trends in health and the physical demands of work making raising the early retirement age feasible. [Read the Full Report]

"The Illinois Retirement Security Initiative is a project of the Center for Tax and Budget Accountability. The goal of the Illinois Retirement Security Initiative is to ensure public retirement benefits in the state are adequately financed and designed to attract high quality employees to the public sector. The Initiative will research, formulate and advocate for public policies towards that end."

Questions; Comments, Concerns?

Pease Contact:

Jourlande Gabriel

Director of the Illinois Retiremement Security Initiative

jgabrie@ctbaonline.org