President's Corner

 

July 2019 Illinois Passes Largest Infrastructure Bill in State History

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President’s Corner – IT’S TIME TO CELEBRATE OUR SUCCESSES

Twice a year, the General Membership Meeting gives members the opportunity to get an in-depth update on our union’s activities and achievements, and also recognize our new Lifetime Members – members who have reached 70 years of age with at least 30 years of service.

At the beginning of these meetings, when Lifetime Members have an opportunity to address the membership, their comments almost always credit our union for providing them a decent way of life and urge the membership to keep up the fight for the next generation. Lifetime members have seen tough times, both in the economy or on picket lines, and they often attest to the strength of Local 150 to face and overcome challenges. The future strength of this union relies on preserving that mindset in every apprentice, journeyman, officer and staff member. No matter what we are up against, we can and will come out stronger on the other side.

After taking the oath of office, President-Business Manager James M. Sweeney talked about how far Local 150 has come since the depths of the Great Recession only a decade ago.

During the depths of the economic downturn, when my General Membership Meeting presentations offered little good news, I said that we would see the day when the meetings were a time for celebration rather than harsh realities. Brothers and Sisters, we’re there. The state of our union is stronger than ever.

Earlier this spring, we celebrated the passage of Illinois’ largest ever capital bill, a $45 billion six-year plan that has been described as “epic” by politicians of both parties. This plan, modeled after the plan passed in Indiana in 2016, created long-term revenue streams and indexed them for inflation to ensure consistent support for Illinois’ transportation infrastructure. An additional $2 billion will go to Illinois’ roads and bridges each year, and hundreds of millions more from the motor fuel sales tax will be returned to the Road Fund in years to come.

This plan is the result of the hard work of Local 150. We were the driving force in passing the Illinois Safe Roads Amendment two years ago to protect transportation revenue, and we were the force that made our dangerous infrastructure a statewide issue. After years without investment in maintenance or modernization of state-funded roads, this plan will create hundreds of thousands of good-paying jobs for years to come as Illinois catches up on its massive backlog. Every Local 150 member should take pride in the role that we had in getting this done.

In addition to the capital plan, we once again have a voice in the operations of the Illinois Tollway, which has been responsible for several billion dollars in investment over the past few years – work which kept road contractors and workers afloat during the complete absence of state funding. I was nominated by Governor Pritzker and confirmed by the Senate to return to the Illinois State Toll Highway Authority Board of Directors, along with leaders from the Carpenters and Laborers.

I am proud of my contribution to the Tollway in its execution of its own capital plan when I served under Governor Quinn, and I am excited to get back to work. There is plenty of work to be done, as the Tollway will spend more than $4 billion in the next few years on the reconstruction of Interstate 294 and $1.8 billion this year and next on the completion of the Elgin-O’Hare Western Access project.

Between state-funded and Tollway work, our members in Illinois will be busy building roads in the coming years, just as Indiana members have been since the passage of its infrastructure plan. With comprehensive infrastructure investment achieved in both Illinois and Iowa, our political priority is evolving toward stamping out one of the most prominent weapons against union members – “right to work.”

The very public defeat of “right-to-work” in Missouri last year demonstrated that when people are informed on what it really is, they will reject it. While defeating a law like this during a legislative session is quite an achievement, the law could be reintroduced the very next year, requiring repeat battles at great expense. The way to kill this policy once and for all is to amend the state constitution to prohibit the law from being adopted, and that is what we will do in Illinois. Amending Illinois’ constitution is certainly a challenge, but we did it once already, with 80 percent of the public supporting the Illinois Safe Roads Amendment. We have no doubt that we are up to the challenge, and that the outcome will be well worth the effort on behalf of our members.

There is good news to report from the Health and Welfare Fund, which currently holds around $1.2 billion in the bank. Consider this in contrast to only nine years ago, when we went on strike across northeastern Illinois simply to preserve our ability to provide decent healthcare benefits. Our victory in that strike was a decisive event in the history of Local 150.

Less than a decade later, we’ve been able to create a healthcare system that allows individual members the ability to choose coverage that suits their lifestyle and budget. We built up reserves sufficient to distribute $300 million into members’ individual credit banks, while leaving nearly a year’s worth of reserves within the fund itself. We’ve never had a backstop like this, and we are in a better position to weather a downturn than we have ever been.

Looking back once again, in late 2011, the union and the fund dedicated $3.5 million to cover COBRA costs so that members who were out of work did not completely lose healthcare. Along with providing food through the Food Bank, ensuring that members didn’t lose insurance was our top priority. By committing nearly all of our reserves to this effort, we were able to reduce COBRA payments from $1,200 per month to only $200. It kept thousands of members insured, but it brought the union within weeks of being unable to make payroll. We implemented emergency cost cuts and laid off staff. From that point, it was a lengthy process to regain financial footing and rebuild the staff. Fast-forward to the present, we currently have a strike fund of almost $15 million. Not only do our finances allow us to operate the most sophisticated organization in the Midwest, but we have the resources to weather any strike that an employer would force upon us. Just knowing that we are able to outlast a contractor serves as an important reminder not to test us. We’ve shown our willingness to go out on strike, and we don’t bluff. We win.

As construction workers, securing quality healthcare for our retirements is critically important, and has always been a top priority for the trustees of the Health and Welfare Fund. This year, we were able to freeze retiree healthcare premiums for the second straight year, which is quite an achievement in the current environment, where healthcare inflation is still running at nearly double-digit rates.

One of the other key tools that we provide to ensure members’ healthcare during retirement is the Retiree Medical Savings Plan (RMSP), a tax-free savings plan that has allowed the union to gradually reduce the subsidy on retiree healthcare while allowing members to save enough money to cover those costs when they come. In 2011, we received projections on how much our contracts should allocate to the RMSP to be sure that the funds would keep up with escalating costs, and have allocated accordingly. Updated projections from late last year indicate that the RMSP has outperformed our expectations. Members’ savings will last several years further into retirement than projected in every scenario we have examined. The ability to pay retirement healthcare costs through a tax-free fund will maximize members’ pensions, and the success of the RMSP will enhance the quality of life for every member in retirement.

The most highly anticipated topic in my presentations at General Membership Meetings is the status of the Pension Fund. I am excited to report that the projected outlook of the Pension Fund is very positive since our return to the “green zone” earlier this year. Remember that the members present at a September 2017 Special General Membership Meeting approved a plan to use existing benefit dollars to shore up the Pension Fund, and despite realizing a return of only 4.5 percent last year, we were certified at 81 percent funded – back into the “green zone” – at the beginning of April.

The plan actually worked better than expected. We planned to shift $290 million in benefit resources to the Pension Fund, but thanks to a very strong market and solid returns, we only had to utilize $200 million to accomplish our goal. The remaining funds were directed into the Health and Welfare Fund earlier this year.

The state of our Pension Fund today is stronger than it has been at any time over the past decade. Whereas in past years, a bad market return was enough to change the course of our recovery, we are set to see increases in our funding percentage, and tough years will serve as a “bump in the road” rather than a catastrophe that requires immediate action.

This renewed strength provides options that we haven’t had in a decade. I promised members at the September 2017 meeting that our return to “green” would prompt another special meeting to discuss options for enhancement of the fund. That meeting date has been set for September 15th, and I would encourage every member to be there. Details of the meeting are on the back cover of this edition of the Engineer.

Finally, I want to recognize the recipients of the 2019 Local 150 Scholarships. This program started in 2013, and has grown each year to provide more scholarships with larger values. Before the General Membership Meeting, we awarded 28 scholarships to Local 150 members’ children and dependents. The total value of these scholarships – awarded for university, community college, and technical schools – was more than $288,000. These funds come primarily from grievance settlements paid by contractors who have violated our contracts.

Each year, standing with these young men and women as we recognize their academic achievements fills me with immense pride. As a second-generation member, Local 150 has meant many things to me ever since I was a child. It provided me a stable home to grow up in, coverage to stay healthy, and a sense that fighting for a better life was always worthwhile. Providing scholarships is a whole new dimension of service to members, and supporting members’ children as they pursue their dreams is something we should all be very proud of.

United We Stand, Divided We Fall.