(From the Crains Chicago Business…)

Rauner vetoes Emanuel’s pension bill

In an expected but still provocative action, Gov. Bruce Rauner today vetoed legislation strongly pushed by Mayor Rahm Emanuel to refinance cash-short pension funds that cover city laborers and white-collar workers.

The state needs comprehensive pension changes, not fund-by-fund ones, Rauner said in a veto message, noting that the city separately is pushing for $215 million to shore up Chicago Public Schools’ pension fund.

“It’s like trying to fix a drought with a drop of rain. We see pension funding challenges throughout the state—one-off, short-sighted approaches won’t really fix the problem,” Rauner said. “We must have comprehensive, long-term pension reform. Let’s get it done.”

Rauner specifically wants approval of a pending bill that, if upheld by the Illinois Supreme Court, would force state workers and teachers outside of Chicago to choose between keeping their guaranteed 3 percent compounded cost-of-living hike in pension benefits, or including pay hikes in their pension base. That measure has been caught in wrangling over the wider state budget.

Emanuel had no immediate response, but is likely to be quite sharp when he does.

Both of the funds—the municipal and laborers retirement systems—are in danger of becoming insolvent in a few years. Emanuel’s bill would require taxpayers to pay more, stretch out payments, and require new but not current workers to make additional contributions.

The latter is the best the city says it can do under Supreme Court rulings.

Emanuel already has pushed though major hikes in the city’s water and sewer fee (a sort of property tax) to pay for the bill.

Rauner had mentioned that in previous threats to veto the bill, but did not include it in today’s veto message.

Expecting the veto, the Senate already has approved and sent identical legislation to the House. The bill Rauner vetoed cannot be overridden because it was passed by a prior General Assembly whose tenure has ended.

Rauner last year similarly vetoed legislation to shore up the city’s police and fire retirement funds, but lawmakers over-rode him and the measure became law.

Update— Emanuel is out with a statement, and it indeed is on the bitter side, with spokesman Adam Collins terming the veto “irresponsible and irrational.”

More from the statement: ‘This bill passed with overwhelming bipartisan support because it improves our fiscal stability for taxpayers and shores up pensions for thousands of retirees who earned them. Instead of helping secure the future of our taxpayers and middle-class retirees, the governor chose to hold them hostage – just as he has done to social service providers, schoolchildren and universities across the state . . . The people of Illinois deserve better.”

Doesn’t sound like the mayor is endorsing the governor for-reelection next year, does it?

If this goes through, Madame Prez will be next in line with her hand out for a hand out!