September 4, 2014 / 10:34 PM / 3 years ago

Illinois pension reform lawsuit may be resolved this year

CHICAGO (Reuters) - An Illinois circuit court judge on Thursday indicated that consolidated lawsuits challenging the constitutionality of a new pension reform law could be resolved by the end of the year given a State Supreme Court ruling on pension benefits in July.

At a status hearing on Thursday, Sangamon County Circuit Court Judge John Belz gave the state until Oct. 3 to respond to plaintiff motions for summary judgment and two other motions and scheduled a status hearing for Oct. 8, according to a court filing.

The public labor union coalition We Are One Illinois and other parties are seeking an expedited ruling in their consolidated lawsuits arguing that the pension reform law passed in December is unconstitutional.

They cited an Illinois Supreme Court decision on July 3 in the case Kanerva v. Weems, in which the court ruled that health care for retired state workers is a pension benefit protected by the state constitution.

The same provision is the focus of the lawsuits filed by We Are One Illinois. The new pension reform law reduces and suspends cost-of-living increases for pensions, raises retirement ages and limits the salaries on which pensions are based.

“In his comments today, Judge Belz indicated that he had read Kanerva and that he believes that he can get this case resolved this year,” said John Shapiro, an attorney for the union coalition.

“The coalition plaintiffs and the other plaintiffs are encouraged by those words that a judgment in their favor will be entered before long.”

Judge Belz on Thursday also struck all other discovery dates in the case from the court calendar.

The state has contended that its sovereign powers allow it to act in a fiscal emergency. Illinois has a $100 billion unfunded pension liability and the country’s worst-funded state retirement system. Illinois’s credit ratings are also the lowest among U.S. states.

A spokeswoman for Illinois Attorney General Lisa Madigan did not immediately respond to a request for comment.

Reporting by Karl Plume; Editing by Dan Grebler

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