Illinois’ worst-in-the-nation pension debt shrank slightly after investments more than tripled predictions, thanks partly to COVID-19 stimulus. Experts caution 1 year cannot undo decades of overpromising and underfunding.
Gov. J.B. Pritzker signed a bill to consolidate local police and firefighter pensions from across downstate Illinois, but beneficiaries are suing because the state is notorious for poor pension management.
Peoria leaders said they are in ‘survival mode’ and need to take $4 million from this year’s budget to help make pension payments for the next two years. The mayor calls for state action to fix the pension debt crisis.
“City officials claim pension payments are going up faster than the city can handle them. Yet, several city officials make comfortable pensions and retirements, and continue to spend our tax dollars on things that don’t serve the taxpayers.”
Barring reforms, the Teachers’ Retirement System could eventually run out of money and be unable to pay promised benefits to retirees, all while making it more expensive for teachers to live in Illinois.
Bills backed by Illinois public-sector unions would give them more power in administering pension funds despite evidence of worse outcomes.
The mayor’s Chicago budget plan includes a $76.5 million property tax hike despite $3.5 billion in federal aid and funds permanent programs with temporary revenues but includes no push to fix pensions.
“The pension problem is Illinois is multi-faceted and misunderstood.”
Rapidly rising property taxes and growing pension costs leave homeowners asked to pay more to get less. Relief requires structural pension reform, starting with a constitutional amendment.
Quincy property taxes do not generate enough to fund the municipal pension costs. Even with that heavy burden, there is so much state and local pension debt that the average Quincy household owns more than $35,600.
Rapidly rising pension costs compete with classroom spending, reducing resources for teachers and students while driving up property taxes.
Despite so much of the property tax share going to public pensions, there is still a huge unmet pension debt. The average Rock Island household owes nearly $40,000 to state and local pensions.
The average Danville household owns nearly $40,000 in state and local pension debt.
Public pensions are growing and taking a greater share of property taxes, hurting public services. Still, the average Rockford household owes over $35,000 in state and local pension debt.