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STILL TO COME TONIGHT, HOW TO

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SAVE MONEY ON YOUR TAXES.

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JAMES "BIGCAT" WILLIAMS ON THE

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LATEST LOP-SIDED LOSS IN THE

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GRIM SEASON FOR THE BEARS.

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AND MAKING GUITARS WITHOUT THE

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HELP OF A COMPUTER, ONE CHICAGO

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MAN SAYS IT IS A DYING ART.

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BUT FIRST, COULD CITIES AND

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TOWNS IN ILLINOIS GO BANKRUPT?

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A NEW REPORT SAYS LOCAL LEADERS

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ARE EYEING BANKRUPTCY AS A WAY

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TO RESTRUCTURE DEBT AND PENSION

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OBLIGATIONS, EVEN THOUGH IT IS

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TECHNICALLY ILLEGAL FOR

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MUNICIPALITIES IN ILLINOIS TO

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FILE SOME ARE PUSHING FOR IT AS

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AN OPTION.

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JOINING US TO DISCUSS THIS IS

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ANDREW SCHROEDTER AND PATRICK

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REHKAMP OF BGA.

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AND THE CO-AUTHOR A REPORT ON

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MUNICIPAL BANKRUPTCY THIS MONTH

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THAT RAN IN THE "SUN-TIMES".

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AND LARRY MORSEY MAYOR OF

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ROCKFORD, FIRST ELECTED IN 2005.

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AND JAMES MCNAMEE, PRESIDENT OF

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THE ILLINOIS PUBLIC PENSION FUND

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ASSOCIATION.

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THAT IS AN UMBRELLA ORGANIZATION

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REPRESENTING POLICE AND FIRE,

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AND IN THE INTEREST OF FULL

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DISCLOSURE I SHOULD NOTE I HAVE

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MODERATED DEBATES ON PENSION

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REFORM FOR THE ASSOCIATION.

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WELCOME BACK TO "CHICAGO

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TONIGHT."

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GLAD YOU ARE HERE.

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PATRICK OR ANDREW, HOW DID YOU

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COME TO FOCUS ON THIS ISSUE?

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>> A LOT OF REPORTING ON THE

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FINANCIAL CONDITIONS, WE FOUND A

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LOT OF MUNICIPALITIES STRUGGLE

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TO PAY THE BILLS AND STRUGGLING

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WITH PENSION DEBT AND CUT JOB,

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ET CETERA.

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AND WE STARTED TO ASK OURSELVES

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WHAT CAN THEY DO TO GET OUT OF

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THE MESS AND A LOT SAID IF IT

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WAS AVAILABLE THEY WOULD

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CONSIDER FILING BANKRUPTCY.

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>> CURRENTLY AS WE MENTIONED,

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THE LEGAL STALL US OF MUNICIPAL

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BANKRUPTCIES IS...

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>> THE WAY FEDERAL BANKRUPTCY

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LAW WORKS MUNICIPALITIES NEED

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STATE APPROVAL BUT THERE IS NO

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STATE LAW THAT SPECIFICALLY

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OUTLINES HOW TO DO THIS.

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I GUESS IF THEY WANTED TO DO THE

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THEY WOULD NEED APPROVAL FROM

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STATE IF THEY DID IT ONE BY ONE

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BUT WE FOUND SOME TOWNS IN EAST

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ST. LOUIS AREA THAT DID FILE FOR

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BANKRUPTCY WASN'T THROUGH IT.

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WE HAVE A GRAPHIC SHOWING THAT,

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THE FEW TOWNS, ONE IS BROOKLYN,

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750 PEOPLE, AND IT FILE FORWARD

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BANKRUPTCY IN 20 HAVE 3 AND

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FACED PAYOUTS FOR POLICE

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MISCONDUCT ANDALLERTON, IT FILED

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IN 2005, AND IT FACED A PAYOUT

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TO A POLICE SHOOTING VICTIM.

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VERY SMALL COMMUNITIES, AND

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THOSE TWO ISSUES THEY WERE

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FACING BANKRUPTED THEM.

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IF IT IS NOT LEGALLY POSSIBLE TO

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FILE FOR BANKRUPTCY IN ILLINOIS,

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HOW DID THEY DO IT?

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>> THEY FLEW UNDER THE RADAR,

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VERY SMALL TOWNS, AND DID NOT

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HAVE A LOT OF DEBT, NOT A MAJOR

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PRESTRUCTURES AND THEIR ATTORNEY

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SAID, HE GOT AWAY WITH IT.

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NO ONE NOTICED, PROBABLY

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WOULDN'T HAPPEN IN THE CHICAGO

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AREA.

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BUT WITH MORE MEDIA AND PEOPLE

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WATCHING.

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BUT IT DID TAKE PLACE DOWN

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THERE.

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MAYOR MORSEY WOULD YOU BE IN

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FAIR OF BANKRUPTCY AS AN OPTION?

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>> THE CITY OF ROCKFORD HAS

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ABSOLUTELY NO PLANS TO FILING

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FOR BANKRUPTCY EVEN IF WE HAD

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THE NORTH.

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WHY DO I FAVOR IT AS A TOOL

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SENATE LEGISLATURE FAILING TO

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TAKE ACTION ON CRITICAL ISSUES

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LIKE PENSIONS AND ASH STRAIGHT

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REFORM AND COLLECTIVE BARGAINING

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REFORM MAY LEAVE THE COMMUNITIES

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NO OPTIONS AND DO WE HAVE A

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DISORGANIZED CHAOTIC QUESTION OF

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HOW WE PAY OUR BILLS OR AN

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ORGANIZED FORMAT THAT WORKED FOR

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GM AND CHRYSLER TO RESET AND

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REBUILD, FRANKLY I THINK CITIES

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NEED THE SAME TOOLS.

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JAMES MCNAMEE, HOW ABOUT THAT,

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CHRYSLER CAN DO IT, IF

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INDIVIDUALS CAN DO IT, WHY NOT

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MUNICIPAL PAYMENTS?

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>> MUNICIPALITYS ARE A

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GOVERNMENT, AND IT IS MUCH

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DIFFERENT THAN A CORPORATION.

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YOU ARE SHAKING THE INVESTOR

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CONVERSATION IN THE COMMUNITY

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AND THEIR LEADERSHIP.

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WHAT IS NEEDED RIGHT NOW IN A

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LOT OF MUNICIPALITIES IS A

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MARSHAL PLAN, WHERE THEY PUT

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FORWARD A PLAN TO REBUILD

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EUROPE, THERE NEEDS A MARSHAL

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PLAN FOR THE COMMUNITIES.

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WE NEED LEADERSHIP THERE AND WE

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NEED A PLAN THERE TO SELL THAT.

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WHEN YOU PUT THAT PLAN FORWARD,

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AT THE END OF WORLD WAR 270% OF

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THE PUBLIC WAS AGAINST IT AND BY

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THE END YOUED WITH 8 HAVE% FOR

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IT.

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>>> MAYOR, WHAT IS THE STATUS OF

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ROCKFORD'S PENSION OBLIGATIONS?

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A PENSION OBLIGATION FOR POLICE

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AND FIRE THAT ARE CREATING THIS

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PRESSURE, THIS INTEREST IN

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EXPLORING THE POSSIBILITY OF

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MUNICIPAL BANKRUPTCY?

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>> BASED ON THE LAST BIT OF

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LEGISLATION CREATING A SECOND

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TIER OF PENSIONERS, A BIG PART

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CREATES IN 2016 A DAY OF

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RECKONING, IF YOU ARE NOT

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FUNDING, THE STATE WILL HAVE THE

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NORTH TO START REDIRECTING

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FUNDINGS IN YOO PENSION SYSTEMS.

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>> THAT IS NOT THE MARSHAL PLAN?

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>> I WASN'T ALIVE WHEN THAT

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HAPPENED SO I DON'T KNOW.

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THE REALITY I LIVE IN IS THAT WE

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ARE PAYING OUR BILLS IN ROCKFORD

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AND WE WON'T HAVE A BIG CRISIS

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LIKE SOME CAN.

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BUT FANGLY AT SOME POINT IN TIME

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IF WE DON'T REDIRECT OR

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ATTENTION, WE DO HAVE A HAVE A

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PLAN THAT DEALS WITH THE

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UNDERLYING ISSUES, ORB STRAIGS

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REFORM IS ONE.

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WE HAVEN'T BEEN ABLE TO GET THE

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STATE'S ATTENTION, THE

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NONEPALITIES HAVE BEEN FORGOTTEN

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AND WHEN CHICAGO MOVES BECAUSE

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THEY HAVE TO MOVE, WE WANT TO BE

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PREPARED IN THE SPRING TO MAKE

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SURE DOWNSTATE HAS A GOOD PLAN.

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ANDREW, WHAT IS THE STATUS OF

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SUBURBAN DEBT AND POTENTIAL

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BANKRUPTCY?

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>> PATRICK AND I LOOKED AT EVERY

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SINGLE POLICE DEPARTMENT IN COOK

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COUNTY, WE FOUND THAT THEY ARE

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UNFUNDED LIABILITIES, AND $23

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BILLION IN UNFUNDED LIABILITIES

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AND MOST INTERESTINGLY, WE SAW

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FOUNDS THAT WERE BORROWING TO

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MAKES PAYMENTS AND THAT A FEW

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HUNDRED THOUSAND LEFT.

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REALLY IN DANGER OF GOING

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BANKRUPT.

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>> GIVE ME AN EBBS OF SOME OF

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THE MUNICIPALITIES IN BAD SHAPE?

185
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>> A LOT OF THE SOUTHLAND,

186
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SOUTHERN COOK COUNTY AND NEAR

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WESTERN SUBURBS, AND ST. CLAIRE

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COUNTY BY EAST ST. LOUIS.

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OBVIOUSLY, WE FOCUSED ON ALERTON

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AND BROOKLYN, AND THEY ARE

191
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BETTER, BUT STRUGGLE AT TIMES.

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WASHINGTON PARK, ANOTHER TOWN

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FILED FOR BANKRUPTCY.

194
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THEY WERE DENIED IT, BUT ONE OF

195
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THE ATTORNEYS FOR THE VILLAGE

196
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TOLD US THAT IN WASHINGTON PARK,

197
00:07:17,733 --> 00:07:22,466
SOONER OR LATER YOU WILL HAVE

198
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BANKRUPTCY WITHOUT HAVING IT.

199
00:07:21,066 --> 00:07:26,833
>> WHAT WOULD BE THE CONSEQUENCE

200
00:07:22,466 --> 00:07:28,800
OF THAT?

201
00:07:23,400 --> 00:07:30,766
EVEN IF THERE WEREN'T A FORMAL

202
00:07:26,833 --> 00:07:31,266
BANKRUPTCY PROCEEDING, WHAT

203
00:07:28,800 --> 00:07:32,900
HAPPENS IF THEY JUST RUN OUT OF

204
00:07:30,766 --> 00:07:34,266
MONEY?

205
00:07:31,266 --> 00:07:36,933
>> MY ARGUMENT HAS BEEN SOME OF

206
00:07:32,900 --> 00:07:38,666
THE FINANCE FOLKS THAT WE ARE

207
00:07:34,266 --> 00:07:41,566
MUCH BETTER OFF HAVING ORGANIZED

208
00:07:36,933 --> 00:07:43,533
FORM OF RESOLVING ISSUES BECAUSE

209
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THE END OF THE DAY IF A COUNCIL

210
00:07:41,566 --> 00:07:47,533
MEMBER HAS TO MAKE A CHOICE, TO

211
00:07:43,533 --> 00:07:48,833
I KEEP COPS AND FIRE MACHINE ON

212
00:07:45,200 --> 00:07:50,733
THE STREETS OR PAY A BOND, I

213
00:07:47,533 --> 00:07:51,833
KNOW THE ANSWER.

214
00:07:48,833 --> 00:07:53,566
SHOULDN'T WE ADDRESS THE ISSUES.

215
00:07:50,733 --> 00:07:55,500
THAT IS NUMBER ONE.

216
00:07:51,833 --> 00:07:58,233
IF WE DON'T WOULDN'T WE LIKE TO

217
00:07:53,566 --> 00:08:02,100
HAVE A SYSTEM THAT DEALS WITH

218
00:07:55,500 --> 00:08:02,733
THIS, THESE OBLIGATIONS IN AN

219
00:07:58,233 --> 00:08:04,500
ORDERLY FASHION AS OPPOSED TO

220
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CHAOS.

221
00:08:02,733 --> 00:08:08,333
THAT WHAT IS IT WOULD BE.

222
00:08:04,500 --> 00:08:09,633
MPBLTSDS JIM, WOULD IT BE CHAOS?

223
00:08:06,766 --> 00:08:12,466
>> THERE ARE SOME ISSUES OUT

224
00:08:08,333 --> 00:08:14,266
THERE WITH THE FUNDING AND

225
00:08:09,633 --> 00:08:18,500
MAKING SURE LEVELS OF FUNDLING.

226
00:08:12,466 --> 00:08:19,766
GOING THROUGH BANKRUPTCY TO GET

227
00:08:14,266 --> 00:08:21,733
OUT OF AN OBLIGATION IS

228
00:08:18,500 --> 00:08:24,466
REPREHENSIBLE IN MY OPINION.

229
00:08:19,766 --> 00:08:27,733
IT IS A WAY TO WIPE THE SLATE

230
00:08:21,733 --> 00:08:29,466
CLEAN OF YOUR OBLIGATIONS.

231
00:08:24,466 --> 00:08:32,333
IF THEY LOOK AT BLOOMINGTON THAT

232
00:08:27,733 --> 00:08:35,733
SAYS WE WILL FUND OUR PLANS AND

233
00:08:29,466 --> 00:08:38,200
THEY CAME UP WITH A PLAN AND THE

234
00:08:32,333 --> 00:08:40,366
MAYOR SAID WE WILL DO THAT.

235
00:08:35,733 --> 00:08:42,600
IN THE CITY OF BLOOMINGTON

236
00:08:38,200 --> 00:08:44,300
APASSED A UTILITY TAX AND

237
00:08:40,366 --> 00:08:45,466
DEDICATE TAD TAX TOWARD THE PPX

238
00:08:42,600 --> 00:08:46,733
AND IN THE LONG RUN IT WILL SAVE

239
00:08:44,300 --> 00:08:49,566
THEIR RESIDENTS MONEY.

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00:08:45,466 --> 00:08:50,333
MILLIONS OF DOLLARS.

241
00:08:46,733 --> 00:08:52,266
THEY HAD IT PROJECTED OUT, WHAT

242
00:08:49,566 --> 00:08:54,466
THE SAVINGS WOULD BE.

243
00:08:50,333 --> 00:08:55,566
THAT IS WHAT I'M TALKING ABOUT.

244
00:08:52,266 --> 00:08:57,333
SOME CASES WE ARE DEALING WITH

245
00:08:54,466 --> 00:09:01,033
WASHINGTON PARK AND WE ARE

246
00:08:55,566 --> 00:09:03,733
DEALING WITH CORRUPTION AND

247
00:08:57,333 --> 00:09:05,500
ABSOLUTE STEALING OF CITY ASSETS

248
00:09:01,033 --> 00:09:07,933
THIS HAPPENED IN DIXON, AND THEY

249
00:09:03,733 --> 00:09:09,533
BECAME WHOLE, LATER ON.

250
00:09:05,500 --> 00:09:11,200
BUT YOU HAD THEY COULDN'T EVEN

251
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OPEN THE POOL UP BECAUSE THEY

252
00:09:09,533 --> 00:09:14,666
SHUT IT DOWN BECAUSE SO MUCH

253
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MONEY WAS DIVERTED AND STOLEN.

254
00:09:12,800 --> 00:09:18,833
WE HAVE SEEN THIS IN OTHER

255
00:09:14,666 --> 00:09:20,433
CITIES, TOO, SOME MALFEASANCE.

256
00:09:17,266 --> 00:09:22,100
>> RESPECTFULLY THAT IS NOT IRAQ

257
00:09:18,833 --> 00:09:23,466
FORWARD AND THE PICTURE IN MOST

258
00:09:20,433 --> 00:09:24,800
ILLINOIS CITIES WHERE WE PAY OUR

259
00:09:22,100 --> 00:09:26,266
BILLS AND WE ARE FINANCIAL

260
00:09:23,466 --> 00:09:28,466
RESPONSIBLE AND WE NEED TO KNOW

261
00:09:24,800 --> 00:09:30,100
THE SYSTEM THAT WE HAVE TO PAY

262
00:09:26,266 --> 00:09:31,333
ON IS A SYSTEM DESIGNED APRIL

263
00:09:28,466 --> 00:09:33,200
BUILT FOR BY THE STATE OF

264
00:09:30,100 --> 00:09:34,600
ILLINOIS AND PENSIONERS AND WE

265
00:09:31,333 --> 00:09:36,033
HAVE TO PAY THE BILL.

266
00:09:33,200 --> 00:09:38,900
WE HAVE NO IMPACT ON THE DESIGN

267
00:09:34,600 --> 00:09:39,800
OF THE PLAN.

268
00:09:36,033 --> 00:09:41,600
>> HOW IS IT THAT THESE

269
00:09:38,900 --> 00:09:42,733
MUNICIPALITIES GOT IN TROUBLE.

270
00:09:39,800 --> 00:09:44,900
THE STATE TOOK THE PENSION

271
00:09:41,600 --> 00:09:46,866
HOLIDAYS AND DID NOT CONTRIBUTE

272
00:09:42,733 --> 00:09:49,566
ITS SHARE.

273
00:09:44,900 --> 00:09:51,533
>> IT IS THE SAME, I THINK, JIM

274
00:09:46,866 --> 00:09:52,400
WOULD AGO REWITH US ON.

275
00:09:49,566 --> 00:09:53,700
WE HAVE FOUND THEY DID NOT MAKE

276
00:09:51,533 --> 00:09:56,033
THEIR PAYMENTS.

277
00:09:52,400 --> 00:09:57,333
THEIR FULL PAYMENTS TO THE

278
00:09:53,700 --> 00:09:58,466
PENSION FUNDS AND THE BENEFITS,

279
00:09:56,033 --> 00:09:59,833
THEY ARE NOT FUNDING THEIR

280
00:09:57,333 --> 00:10:02,366
BENEFITS AND THEY SAY IT IS

281
00:09:58,466 --> 00:10:03,600
BECAUSE THE MONEY IS NOT THERE,

282
00:09:59,833 --> 00:10:04,966
AND I THINK JIM AND OTHERS WOULD

283
00:10:02,366 --> 00:10:06,833
PROBABLY DISAGREE BUT THE FACT

284
00:10:03,600 --> 00:10:08,433
OF THE MATTER IS THAT COUPLED

285
00:10:04,966 --> 00:10:11,266
WITH THE RECESSION AND LOSSES IN

286
00:10:06,833 --> 00:10:12,433
THE STOCK MARKET AND THE FACT

287
00:10:08,433 --> 00:10:15,600
THAT, LET'S BE HONEST, LAW

288
00:10:11,266 --> 00:10:17,333
ENFORCEMENT FOKTS ARE MAKING

289
00:10:12,433 --> 00:10:19,333
MONEY AND THEY ARE LIVING LONG

290
00:10:15,600 --> 00:10:21,700
AND THE PENSION BENEFITS ARE

291
00:10:17,333 --> 00:10:22,466
SWEETER AND THAT IS A PERFECT

292
00:10:19,333 --> 00:10:25,266
STORM THAT CAUSEDS FUNDS TO

293
00:10:21,700 --> 00:10:27,100
SUFFER.

294
00:10:22,466 --> 00:10:28,400
GIVE ME AN IDEA OF WHAT AN

295
00:10:25,266 --> 00:10:31,100
AVERAGE PENSION IS FOR A RETIRED

296
00:10:27,100 --> 00:10:32,333
POLICE OFFICER OR FIREFIGHTERS?

297
00:10:28,400 --> 00:10:33,966
>> IT WOULD BE IN AND AROUND THE

298
00:10:31,100 --> 00:10:34,833
50s.

299
00:10:32,333 --> 00:10:40,633
IT DEPENDS ON WHAT AREA YOU WERE

300
00:10:33,966 --> 00:10:42,366
IN.

301
00:10:34,833 --> 00:10:43,900
PAYING BENEFITS, IT CHAIGS BY

302
00:10:40,633 --> 00:10:45,600
WHAT COMMUNITY YOU WORKED FOR.

303
00:10:42,366 --> 00:10:47,966
IN HAVE HIGHER THAN OTHERS.

304
00:10:43,900 --> 00:10:49,433
I WOULD SAY IN THE 50s.

305
00:10:45,600 --> 00:10:51,533
DO THEY GET SOCIAL SECURITY NO

306
00:10:47,966 --> 00:10:53,633
THE CITY DOESN'T HAVE TO PAY FOR

307
00:10:49,433 --> 00:10:56,500
THE SOCIAL SECURITY END OF IT,

308
00:10:51,533 --> 00:10:58,066
AND THE BENEFIT THAT GIVES THEM

309
00:10:53,633 --> 00:11:00,366
THEIR BACKUP IS THEIR PENSION.

310
00:10:56,500 --> 00:11:03,533
>> WHAT WE NEED TO REMEMBER FEF

311
00:10:58,066 --> 00:11:06,200
FOLKS THAT ARE ELIGIBLE TO

312
00:11:00,366 --> 00:11:07,033
RETIRE AT AGE 50 AND 75% OF

313
00:11:03,533 --> 00:11:08,133
THEIR HIGHEST WAGE AND

314
00:11:06,200 --> 00:11:11,433
COMPOUNDING INTEREST AND FOR

315
00:11:07,033 --> 00:11:13,666
POLICE AND FIREFIGHTERS THAT

316
00:11:08,133 --> 00:11:17,066
MEANS THEIR SPOUSE GETS THEIR

317
00:11:11,433 --> 00:11:19,700
BENEFIT WITH NO DECREASE.

318
00:11:13,666 --> 00:11:21,600
THAT IS A NOT FINANCIALLY SOLVE

319
00:11:17,066 --> 00:11:24,100
VENT SYSTEM, AND AN APPROACH, IT

320
00:11:19,700 --> 00:11:25,800
CAME AT A TAME WHEN A LOT OF

321
00:11:21,600 --> 00:11:27,666
CHANGES WERE MADE THE STOCK

322
00:11:24,100 --> 00:11:31,033
MARKET WAS GOING CRAZY IN THE

323
00:11:25,800 --> 00:11:32,600
EARLY 90s AND WE DON'T HAVE THE

324
00:11:27,666 --> 00:11:34,600
ABILITY TO KEEP PAYING AT THE

325
00:11:31,033 --> 00:11:36,266
SAME LEVEL.

326
00:11:32,600 --> 00:11:38,700
WE HAVE A CHOICE, WE REFORM THE

327
00:11:34,600 --> 00:11:40,566
SYSTEM AND WE DO IT IN A WAY

328
00:11:36,266 --> 00:11:42,766
THAT IS PROTECTED OR WE HAVE TO

329
00:11:38,700 --> 00:11:43,033
PREPARE FOR BIG TAX INCREASE

330
00:11:40,566 --> 00:11:46,166
THAN AND UTILITY TAX, PROPERTY

331
00:11:42,766 --> 00:11:47,866
TAX.

332
00:11:43,033 --> 00:11:50,033
WE ARE NOT THE LARGEST HOME

333
00:11:46,166 --> 00:11:51,666
RULED KMTD IN THE STATE AND WE

334
00:11:47,866 --> 00:11:52,033
ARE UP AGAINST PROPERTY TAX CAPS

335
00:11:50,033 --> 00:11:54,433
AND WE CAN'T RAISE OUR RATES

336
00:11:51,666 --> 00:11:55,633
HIGHER.

337
00:11:52,033 --> 00:11:57,233
WE HAVE TO LOOK AT A DIFFERENT

338
00:11:54,433 --> 00:11:58,733
WAY TO RAISE REVENUE.

339
00:11:55,633 --> 00:12:00,433
WE ARE LOOKING AT REFORMS TO

340
00:11:57,233 --> 00:12:01,866
DEAL WITH THE PROBLEM.

341
00:11:58,733 --> 00:12:04,300
>> SO THE PENSION IS GOING

342
00:12:00,433 --> 00:12:07,133
FORWARD AS YOU MENTION, AND THEY

343
00:12:01,866 --> 00:12:08,233
HAVE BEEN CHANGED AND THEY

344
00:12:04,300 --> 00:12:10,766
REDUCED ALL FROM THE COLAS TO

345
00:12:07,133 --> 00:12:12,500
THE RETURMT AGE.

346
00:12:08,233 --> 00:12:13,733
A LOT OF THIS WE HAVE TO KEEP

347
00:12:10,766 --> 00:12:15,400
PERSPECTIVE ON WHEN WE LOOK AT

348
00:12:12,500 --> 00:12:17,966
PUBLIC SAFETY INDIVIDUALS WHY

349
00:12:13,733 --> 00:12:20,133
THEY RETIRE AT THATLE AGE.

350
00:12:15,400 --> 00:12:21,666
DO YOU WANT A 60-YEAR-OLD MAN

351
00:12:17,966 --> 00:12:23,466
WRESTLING WITH AN 18-YEAR-OLD

352
00:12:20,133 --> 00:12:25,100
MAN OUT THERE.

353
00:12:21,666 --> 00:12:28,966
YOU WILL HAVE A DISABILITY ON

354
00:12:23,466 --> 00:12:30,633
THAT 60-YEAR-OLD.

355
00:12:25,100 --> 00:12:32,766
WE DESIGN THE PLANS WITH THE

356
00:12:28,966 --> 00:12:35,633
INDIVIDUALS IN MIND TO GET THE

357
00:12:30,633 --> 00:12:36,800
ROTATION OUT AND BRING IN

358
00:12:32,766 --> 00:12:38,300
YOUNGER PEOPLE AS YOU POINTED

359
00:12:35,633 --> 00:12:38,600
AUTOMATIC THERE ARE BANKRUPTCIES

360
00:12:36,800 --> 00:12:42,133
IN THE U.S. THAT WE ARE TALKING

361
00:12:38,300 --> 00:12:43,333
ABOUT.

362
00:12:38,600 --> 00:12:45,900
FOR EXAMPLE, OYK ORANGE COUNTY,

363
00:12:42,133 --> 00:12:47,533
CALIFORNIA, FILED FOR BANKRUPTCY

364
00:12:43,333 --> 00:12:50,733
IN 1994.

365
00:12:45,900 --> 00:12:52,166
DETROIT, MICHIGAN, WELL KNOWN

366
00:12:47,533 --> 00:12:54,366
CASE, 700,000-PLUS IN 2012.

367
00:12:50,733 --> 00:12:56,266
JEFFERSON COUNTY, ALABAMA

368
00:12:52,166 --> 00:12:58,366
POPULATION ABOUT 700,000, FILED

369
00:12:54,366 --> 00:12:59,566
IN 2011.

370
00:12:56,266 --> 00:13:00,866
IN SOME OF THOSE

371
00:12:58,366 --> 00:13:03,566
JURISDICTIONINGS MY

372
00:12:59,566 --> 00:13:05,066
UNDERSTANDING THINKS WERE

373
00:13:00,866 --> 00:13:05,466
CONSTITUTIONAL PROTECT TEXTS AND

374
00:13:03,566 --> 00:13:06,333
FEDERAL COURTS WENT ALONG WITH

375
00:13:05,066 --> 00:13:08,133
IT.

376
00:13:05,466 --> 00:13:09,333
HOW COME?

377
00:13:06,333 --> 00:13:10,500
>> THAT IS WHERE IT GETS

378
00:13:08,133 --> 00:13:11,800
INTERESTING, ESPECIALLY HERE IN

379
00:13:09,333 --> 00:13:12,866
ILLINOIS.

380
00:13:10,500 --> 00:13:14,400
PENSIONS PROTECTED BY THE

381
00:13:11,800 --> 00:13:17,033
CONSTITUTION BUT THE JIFRT OF

382
00:13:12,866 --> 00:13:18,300
WHAT HAPPENED IN THE BANKRUPTCY

383
00:13:14,400 --> 00:13:21,000
CASES AT THE FEDERAL JUDGES SAID

384
00:13:17,033 --> 00:13:23,700
FEDERAL LAW SUPERCEDES THAT

385
00:13:18,300 --> 00:13:24,733
STATE PROTECTION AND I THINK

386
00:13:21,000 --> 00:13:27,000
SOME JUDGES SAID THEY CAN'T BE

387
00:13:23,700 --> 00:13:29,100
ADJUSTED AND THIS IS WHERE THE

388
00:13:24,733 --> 00:13:30,266
FEAR IS IF THERE WAS A PROVISION

389
00:13:27,000 --> 00:13:31,633
IN ILLINOIS THAT ALLOWED THEM TO

390
00:13:29,100 --> 00:13:32,733
FILE FOR BANKRUPTCY A LOT OF

391
00:13:30,266 --> 00:13:35,566
PEOPLE WOULD SEEK TO TAKE

392
00:13:31,633 --> 00:13:36,466
ADVANTAGE OF IT BECAUSE SOME OF

393
00:13:32,733 --> 00:13:38,366
THE PENSIONS BENEFITS COULD BE

394
00:13:35,566 --> 00:13:39,233
RESTRUCTURED.

395
00:13:36,466 --> 00:13:40,700
>> AS WE MENTIONED JAMES

396
00:13:38,366 --> 00:13:43,233
MCNAMEE, TODAY THERE WAS A

397
00:13:39,233 --> 00:13:46,133
LAWSUIT FILED AGAINST THE CITY

398
00:13:40,700 --> 00:13:47,466
OF CHICAGO PLANS FOR PENSION

399
00:13:43,233 --> 00:13:48,733
REFORM THAT INCLUDES HIGHER

400
00:13:46,133 --> 00:13:50,033
CONTRIBUTIONS AND LOWER COST OF

401
00:13:47,466 --> 00:13:51,333
LIVING INCREASES.

402
00:13:48,733 --> 00:13:55,066
IS THIS A CONCERN THAT THE

403
00:13:50,033 --> 00:13:58,133
FEDERAL COURT MAY STEP IN AND

404
00:13:51,333 --> 00:14:00,133
SAY FEDERAL LAW PREEMPTS STATE

405
00:13:55,066 --> 00:14:02,733
LAWS?

406
00:13:58,133 --> 00:14:03,900
WE GET CONCERNED ABOUT THAT AND

407
00:14:00,133 --> 00:14:05,533
WE SHOULD LOOK AT MICHIGAN.

408
00:14:02,733 --> 00:14:06,766
MICHIGAN'S CONSTITUTION IS A

409
00:14:03,900 --> 00:14:09,500
LITTLE BIT DIFFERENT AND THE

410
00:14:05,533 --> 00:14:11,266
LANGUAGE IS DIFFERENT ABOUT HOW

411
00:14:06,766 --> 00:14:12,533
THEY PROTECT PENSIONS.

412
00:14:09,500 --> 00:14:14,033
AND THERE ARE DIFFERENCES THERE.

413
00:14:11,266 --> 00:14:15,966
AND IN CALIFORNIA WHERE THE

414
00:14:12,533 --> 00:14:16,466
BANKRUPTCIES CAME IN PLACE THE

415
00:14:14,033 --> 00:14:19,966
PENSION BENEFITS WERE NOT

416
00:14:15,966 --> 00:14:20,666
REDUCED.

417
00:14:16,466 --> 00:14:22,500
THE BANKRUPTCY COURTS DO D NOT

418
00:14:19,966 --> 00:14:24,300
REDUCE THEM.

419
00:14:20,666 --> 00:14:25,566
COULD HAVE BUT DIDN'T.

420
00:14:22,500 --> 00:14:27,600
AND IN CHICAGO, I THINK ONE OF

421
00:14:24,300 --> 00:14:29,433
THE QUESTIONS THAT WE HAVE TO

422
00:14:25,566 --> 00:14:30,766
GET GOING, AN ISSUE THAT WE HAVE

423
00:14:27,600 --> 00:14:33,166
BEEN PUSHING IS THEY SHOULDN'T

424
00:14:29,433 --> 00:14:34,766
BE SELLING OFFER INFRASTRUCTURE,

425
00:14:30,766 --> 00:14:35,900
TO PLUG A ONE-TERM BUDGET HOLE

426
00:14:33,166 --> 00:14:36,933
LIKE WHAT HAPPENED WITH PARKING

427
00:14:34,766 --> 00:14:38,500
METERS.

428
00:14:35,900 --> 00:14:40,866
THEY SHOULD HAVE BEEN LOOKING AT

429
00:14:36,933 --> 00:14:43,133
THE MONEY AND PARKING METER

430
00:14:38,500 --> 00:14:44,900
GIVEN TO THE PENSION FUND.

431
00:14:40,866 --> 00:14:47,066
>> WE ARE OUT OF TIME.

432
00:14:43,133 --> 00:14:49,133
BUT REAL QUICKLY, WHAT DO YOU

433
00:14:44,900 --> 00:14:50,400
WANT THE PUBLIC TO KEEP IN MIND?

434
00:14:47,066 --> 00:14:51,100
>> WE'LL HAVE A BUSY SPRING

435
00:14:49,133 --> 00:14:53,933
LEGISTATIVE SESSION AND

436
00:14:50,400 --> 00:14:55,900
UNDERLYING ACTION THAT HAS TO

437
00:14:51,100 --> 00:14:57,733
TAKE PLACE F IF WE TAKE ACTION

438
00:14:53,933 --> 00:14:58,833
SOME OF THE FUNDAMENTAL COST

439
00:14:55,900 --> 00:15:00,700
DRIVERS WE WON'T HAVE TO TALK

440
00:14:57,733 --> 00:15:02,333
ABOUT MUNICIPAL BANKRUPTCY.

441
00:14:58,833 --> 00:15:04,233
THE CITY OF ROCKFORD IS IN A

442
00:15:00,700 --> 00:15:05,033
STRONG FOOTING AND WE WILL DO

443
00:15:02,333 --> 00:15:06,966
OUR PART TO HELP LEAD REFORMS IN

444
00:15:04,233 --> 00:15:08,266
THE STATE.

445
00:15:05,033 --> 00:15:11,033
>> I APPRECIATE IT AND ANDREW

446
00:15:06,966 --> 00:15:14,466
SCHROEDTER AND PATRICK REHKAMP