Illinois' top court to decide if public-employee pension bailout violated state constitution

Economic IndicatorsAssociated Press

One of the most critical issues for Illinois government in recent history is heading to the state Supreme Court.

Lawyers representing the state will argue that a state-employee pension overhaul is necessary because of a dire fiscal emergency — a $111 billion deficit.

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Lawmakers adopted the plan in 2013 for four state pension systems. It reduces retirement benefits to current state workers while also slightly reducing contributions.

A county judge ruled last fall that the initiative violates the Illinois Constitution because it cuts promised retirement benefits to current employees.

The state argues that the government has "police powers" to change contracts in extraordinary circumstances.

It's uncertain when the court will rule, but it heard the case on an accelerated timetable.