Scherer Sponsors Smart Reforms to Improve Employee Retirement Plans

SPRINGFIELD, Ill. – State Rep. Sue Scherer, D-Decatur, is working to improve the economic security of tens of thousands of teachers, public safety workers, and state employees by sponsoring smart reforms to strengthen the state’s retirement systems and help recruit and retain great public service workers.

“Illinois’ retirement systems need to balance the financial realities facing the state with our commitment to the men and women who educate our children, who keep us safe, and who build and maintain our communities,” said Scherer. “The so-called ‘Tier 2’ benefits are not balanced, and that’s making it harder to keep great people in these critical jobs. Fixing Tier 2 is about keeping Illinois competitive and keeping our communities strong.”

A major restructuring of state employee benefits in 2011 created two tiers of retirement plans for teachers and state workers. Those hired after Jan. 1, 2011 receive “Tier 2” plans with lower benefits and an increased retirement age. More than half of all teachers, firefighters, nurses, and other public employees are now enrolled in Tier 2. As many of these employees are not eligible for Social Security, there is concern that the diminished guarantees of Tier 2 violate federal standards ensuring employees who cannot enroll in Social Security receive at least equivalent benefits.

Inadequate retirement security is also cited as a major cause of the teacher shortage, and a challenge recruiting and retaining first responders and other public employees.

In response, Scherer is sponsoring House Bill 5909, which makes Tier 2 more competitive by raising cost of living adjustments and aligning the retirement age with Tier 1. These reforms will make it easier for schools, universities, and communities to hire and keep qualified employees, while still controlling pension liabilities.

“As an educator of over 30 years, I know firsthand the dedication it takes to serve the young people in our classrooms. And I think we need to do right by the people who do the hard work that helps our state function,” said Scherer. “This is just the latest step we are taking to undo some of the past mistakes our state has made and invest in people to make sure Illinois’ future remains bright.”