In re Pension Reform Litigation
2015 IL 118585
| Ill. | 2015Background
- Public Act 98-599 (2014) reduced Tier 1 pension benefits for GRS, SERS, SURS and TRS members who joined before 2011; JRS was excluded.
- Five lawsuits consolidated in Sangamon County challenged the Act as violating the Illinois Constitution, including pension protection clause Art XIII, §5, and at least one contract/ equal protection argument.
- Circuit Court granted partial summary judgment for plaintiffs on pension clause claims, declared Act unconstitutional in full, and enjoined enforcement.
- Act’s core features included delaying annuity eligibility, capping pension calculations, eliminating or reducing automatic increases, and altering money-purchase base calculations.
- State asserted a reserved sovereign (police) power defense to override constitutional protections; the appeals were taken directly to the Illinois Supreme Court under Rule 302(a)(1).
- Court’s ultimate holding affirms that Act violates the pension protection clause and is not salvaged by police powers; severability language cannot save the statute; the Act is void in its entirety.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Does Act 98-599 violate the pension protection clause (Art. XIII, §5)? | RSEA/ISEA/SUAA/Harrison contend benefits are protected | State argues police power allows modification for fiscal health | Yes; Act violates Art. XIII, §5 and cannot be sustained. |
| Can the Act's reductions be upheld under police powers despite Art. XIII, §5? | Pension protections trump emergency measures | Police power justifies necessary public welfare actions | No; police power defense fails. |
| Are the invalid provisions severable from the remainder of Pub. Act 98-599? | Even with invalid parts, remainder could stand | Legislative purpose relies on invalid provisions | No; statute void in its entirety. |
| Does Act violate the contracts clause (Art. I, §16) or otherwise impair contracts? | Reductions impair contractual rights | Cannot alter contract protections under crisis | Yes; contracts clause violation identified; cannot be saved by remedial police power. |
Key Cases Cited
- Kanerva v. Weems, 2014 IL 115811 (Illinois Supreme Court 2014) (pension protection clause meaning remains prohibitive of diminishment or impairment)
- Sklodowski v. State, 182 Ill. 2d 220 (1998) (protects enforceable pension benefits from diminishment)
- Jorgensen v. Blagojevich, 211 Ill. 2d 286 (2004) (judicial salaries cannot be diminished; limits on police power over protected rights)
- Felt v. Bd. of Trustees of the Judges Retirement System, 107 Ill. 2d 158 (1985) (contracts clause and protections against pension reductions)
- Miller v. Retirement Board of Policemen’s Annuity & Benefit Fund, 329 Ill. App. 3d 589 (2001) (benefit calculation formulas protected from unilateral changes)
- Ex parte Milligan, 71 U.S. 2 (1866) (constitutional protections cannot be suspended in emergencies)