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The Great Pension Debate. A detailed analysis of the Illinois Constitution’s pension clause. [UPDATED]

Read the full text of the speech given by Franklin MacVeagh, former President of the Commercial Club of Chicago and U.S. Secretary of Treasury, on the importance of honoring one's contracts, his views on labor unions, and other significant matters
 

 


Over the course of the past two years a great legal debate has been brewing.  It’s come at a time when lawmakers and Governors in states all across America have called for cuts to public employee benefits – especially pensions.

One of the state’s most vocal advocacy groups for reducing the retirement benefits of public employees is the Civic Committee of the Commercial Club of Chicago.  Their enlistment of the prestigious law firm of Sidley Austin LLP has repeatedly made the argument that benefits for public workers can be diminished by maneuvering through the pension clause of the Illinois Constitution.

Can Illinois lawmakers break the pension promise with workers?  What was the intent of the Constitution’s framers in 1970?  What did the media at the time report about the issue?  What have the courts said?

Those are among the questions that attorney Eric Madiar, Chief Legal Counsel to Illinois Senate President John Cullerton, began asking about Article XIII, section 5 of the Illinois Constitution.

Madiar’s 76-page analysis of this clause is comprehensive and concludes that welching on public pension promises is not an option for Illinois as some legal and civic commentators have suggested.
 

Can The Pension Promise Be Broken?
This section contains Eric Madiar’s comprehensive legal and historic analysis of the 1970 Constitution’s pension clause.  In this report, you will find a history of the convention debates and discussions, media perspectives of the time, what the courts have said throughout the past 40 years, as well as an analysis of recent arguments from Sidley  Austin LLP and Gino DiVito.  

Abstract - a one-page overview of the comprehensive analysis.

 

 

 

 

Full Article - A 76-page comprehensive analysis.

 

 

 

 

Appendices

 

 

Correspondence
Below, find copies of the varied back and forth memorandums and analyses of attorneys on both sides of the issue.  These opinions are among the source materials referred to in the comprehensive analysis. 

Sidley Pension Reform Analysis - 3-10

Devito Response - 4-12-10

Devito Letter - 4-13-10

ISBA Pension Statement - 4-14-10

Sidley Memo - 4-27-10

Devito Memo - 5-5-10

Guarantor Memorandums
What if the Illinois retirement systems go broke?  See what Sidley Austin LLP had to say. 

Sidley Guarantor Memo

Sidley Supplemental Guarantor Memo

Pay More for the Same?
Can the General Assembly force workers to pay more of their income for the same level of benefits? The law firms of DLA Piper and Jenner & Block have said no.

Constitutionality Memo - 04-19-2010

Jenner and Block Memo

UPDATED 12/12/13:  Pension debate at 1970 Constitutional Convention echoes in today's crisis - Chicago Tribune