05/31/2012 09:32 am ET

Illinois Pension Reform: House Speaker Strikes Last-Minute Deal, Favoring Schools

As the clock ticks in Springfield for Illinois to establish a new pension deal before lawmakers conclude their spring session Thursday, House Speaker Michael Madigan late Wednesday announced a "breakthrough" on the legislation that has sharply divided the House and Senate.

At stake is the state's massively underfunded pension system, which Democrats said could be balanced by shifting teacher pension costs from the state to schools, universities and community colleges.

Earlier this month, Gov. Pat Quinn seemed to back the measure, and a report by the Illinois Policy Institute supported the measure. In a study released in early May, the Institute reported that shifting teacher pension costs onto schools, as is the case in Chicago Public Schools, would only increase costs by 1 to 4 percent in some cases, while 57 percent of the districts will save money.

But downstate school districts pushed back, and on Wednesday Madigan announced that the governor had had a change of heart.

“I had an interesting meeting this morning with Gov. Quinn and I was surprised the governor disagreed with me on the issue," Madigan said Wednesday night before the House adjourned, according to the Chicago Sun-Times. "He agrees with you. He agrees with the Republicans, and he thinks we ought to remove the shift of normal costs out of the bill."

Madigan then removed his name as the House sponsor of SB 1673, and transfered ownership to House Minority Leader Tom Cross (R-Oswego), a vocal opponent of charging schools to cover pensions, according to WBEZ.

The bill now joins a host of issues that will face a House executive committee Thursday morning as the Spring legislative session winds down.

Pension reform, particularly within schools, has been uniquely divisive in Illinois this year. During a debate Tuesday, state Rep. Mike Bost (R-Murphysboro) shouted and threw things during an impassioned speech against the legislation and the vote that moved it to the House floor.