Pension reform may cause financial pain for Chicagoans - Dallas News | myFOXdfw.com

Pension reform may cause financial pain for Chicagoans

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CHICAGO (FOX 32 News) -

There is financial pain for everyone in Mayor Emanuel's new pension reform plan. For the typical city homeowner, property taxes would go up about $300. For city workers, more of their paychecks would be diverted into the pension fund. Plus, all of this would only deal with half of the city's crisis.

Mary Jones has a lot more time now to show flash cards to her 2-year-old granddaughter Natalja. After 33 years as a Chicago librarian, the 61-year-old retired with a $33,000 pension. She likes the 3% raise she now gets every year and worries that the mayor's proposal to cut it in half, to 1.5%, could eventually hurt her purchasing power.

"To take away that 3% and give me 1.5%...That's not helping me. That's hurting me," Jones said.

Jones is also a homeowner, and fears her Chatham neighborhood would be hit hard by the $750 million in property tax increases that the public employee pension reform plan would require by 2019.

When asked what it will mean being hit with hundreds of dollars in property taxes, Jones responded, "That will mean that I will have to get rid of my house…You see neighborhoods now that are boarded up. I can see my neighborhood becoming one of those."

Mayor Emanuel argued the alternatives, which include doing nothing, would be far worse; given Chicago's already nearly-rock-bottom credit rating.

"When you compare this to a 150% property tax, the largest in the history of the city, which I opposed; or massive service cuts and massive layoffs on the other side, which I opposed…And the other rejection I have is to leave it on course and allow it to go belly up. Those are the three options that I think are unacceptable," said Mayor Emanuel.

The mayor's proposal now goes to the General Assembly in Springfield. He said a majority of the city's 30 public employee unions had signed off on it. However, it faces fierce opposition from some of the biggest government unions, including the Chicago Teachers Union, the Fraternal Order of Police and the Chicago Fire Fighters Union. The firefighter's pension fund is in the worst shape of all, and could be completely broke in as little as 5 years.

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