Budget + Tax

Illinois pension funds need 19 percent annual investment returns to make ends meet

Illinois reports that it owes $83 billion to its five public pension funds. Worse yet, under new reporting requirements by the Governmental Accounting Standards Board and Moody’s Investment Services, the state’s pension debt will more than double. There are a lot of numbers being thrown around in the fight over pension reform. But these are the...

By Jonathan Ingram

Institute in Baltimore Sun: Is another federal bailout coming?

Maryland stands to lose big if the government steps in to save state pension systems

The cost of pension inaction

by Conor Durkin When politicians lose interest in reform, taxpayers “lose interest,” too. Last week Gov. Quinn’s special legislative session failed to pass a bill dealing with Illinois’ pension problems. Yet even if any measure had passed, Illinois’ massive problems would persist. The proposals debated in Springfield were far too small to make a visible...

By Chris Andriesen

Quotes from Aug. 17 special session to reform state pensions

While they only managed to pass an amendment, the House provided some memorable quotes.

Illinois must shift from defined benefit to defined contribution plans.

Illinois’ state pension systems are barreling towards insolvency. Without a complete pension overhaul, Illinois’ five pension systems may reach their breaking point. There is only one way to prevent a collapse. Illinois must shift from defined benefit (DB) to defined contribution (DC) plans. In a DB plan, an employer pays fixed, regular pension payments over a...

By Benjamin VanMetre

Pension debt more than doubles under new rules

THE PROBLEM Illinois reports that it owes $83 billion to its five public pension funds. That amount represents the chronic failure of the state to fully fund its pension systems, overly generous retirement benefits for state workers, and the inability of those funds to meet their investment targets. Unfortunately, this $83 billion figure grossly understates...

By Jonathan Ingram

Illinois’ pension math

When Rhode Island saw the writing on the wall late last year, its legislature did something no one thought it could do. It passed the boldest pension reforms in the nation. A democrat-controlled state, with the second-worst funded pension system in the nation, passed a series of reforms that cut the state’s unfunded liabilities by...

By Ted Dabrowski

Teacher retirement costs stealing our kids’ futures

Just over the past five years, 71 cents from every new dollar set aside by state government for Pk-12 education went to teacher retirement costs.

LOCAL PENSION ACCOUNTABILITY POLL

Illinois survey of 500 likely voters Who should fund the employer share of teacher pensions: the state or local school districts? Will local pension accountability lead to higher property taxes? Last month, these questions prompted legislative talks over pension reform to come to a standstill. The results of a new poll commissioned by the Institute finds that public...

By Chris Andriesen

Illinois pension debt: It’s worse than you imagined

Last week, the Governmental Accounting Standards Board, or GASB, finalized new rules to make pension funding more transparent. These new rules require governments to use more appropriate discount rates than most public pension plans have been using. Pension plans with sufficient funds set aside to pay future benefits can continue to discount future liabilities by current investment...

By Jonathan Ingram

Five reasons why local pension accountability is right for Illinois

To see how local pension accountability will affect your district, click here. For decades, the state has subsidized the costs of pensions awarded to teachers who work at locally-run school districts. How? The state pays the “employer” share of pension benefits that teachers accrue each year, even though teachers are not state employees. That arrangement...

By Ted Dabrowski

$203 billion and counting: Total debt for state and local retirement benefits in Illinois

The problem State government owes billions of dollars for the pensions and health insurance benefits of retired government workers. Local governments owe billions more. Illinois taxpayers are on the hook for the liabilities of both state and local government. State government alone owes $83 billion to its pension funds. However, this figure alone presents an...

By Collin Hitt, Ted Dabrowski, Jonathan Ingram

$203 billion and counting: Total debt for state and local retirement benefits in Illinois

$203 billion and counting: Total debt for state and local retirement benefits in Illinois by Illinois Policy Institute

By Jonathan Ingram

UPDATE: Senate concurs with tax hike on the poor

We’ve previously reported on SB 2194, which imposes new taxes on tobacco products and hospitals. Of course, cigarette taxes can’t fix the structural problems of Medicaid. Last week, the bill passed the House 60-52, with eighteen Republicans voting for the tax hike. Moments ago, the Illinois Senate concurred with the House 31-27, sending the bill to the Governor’s...

By Jonathan Ingram