Illinois Senate President John Cullerton’s pension bill could be unconstitutional, is unfair to workers and based on unproven math, and perpetuates Illinois’ broken pension system.
State Sen. Dale Righter, R-Mattoon, has proposed a plan that would give all state workers access to retirement plans that offer portability and flexibility – and an escape from Illinois’ broken pension system.
Former U.S. House of Representatives Speaker Dennis Hastert had been receiving nearly $30,000 annually from the underfunded General Assembly Retirement System.
Nearly 38 percent of Illinois Teachers Retirement System assets are in so-called alternative investments.
Illinois’ teacher pension system is structured to allow local school boards to agree to generous contracts, knowing taxpayers across the state will foot the bill. This system should change so that local school boards cover their own pension costs. That way, they will bear the full cost of salary increases they decide on, rather than pushing much of that cost onto unaware state taxpayers.
Since 1998, more than 20,000 state university workers have opted into a 401(k)-style plan instead of the traditional pension plan.
In 2010, the unfunded debt related to pensions and retiree health care costs for local and state government workers across Illinois was $203 billion, the equivalent of more than $43,000 per household. In just six years, the total debt Illinois households are on the hook for has jumped to $56,000, or 31 percent. That’s a $13,000 increase for each household. Total unfunded debt for state and local governments in Illinois now totals $267 billion.
More than 50 percent of the state’s $4.1 billion budget for public universities is spent on retirement costs alone.
While sick leave is necessary for working teachers, letting unpaid sick leave accumulate for the purpose of boosting pensions is an expensive perk that taxpayers cannot afford.
A golden rule of finance is this: Debt that can’t be paid won’t be paid.
The head of the Illinois Municipal Retirement Fund, or IMRF, has dismissed calls for pension reform, disregarding the fact that pensions aren’t manageable, benefits aren’t affordable, and previous “reforms” propped up pensions on the backs of new workers.
Illinois households are now on the hook for $27,000, up 17 percent from 2015.
The ratings agency cited the city’s “considerable growth” in pension debt in its Oct. 28 downgrade to A3 from A1.
Former Gov. Jim Edgar’s pension compromise with House Speaker Mike Madigan in the 1990s set the state’s pension funds down an unsustainable road.