Despite claims of Chicago’s improving financial condition, the $48 billion in pension debt for the city’s core retirement systems continues to loom over its fiscal future.
Mayoral candidate and Chicago Teachers Union organizer Brandon Johnson is eligible to collect an estimated $1.1 million pension through the Chicago Teachers’ Pension Fund despite only teaching for four years. His future path could yield a public pension worth over $2.8 million.
A Chicago civic group suggests either increasing the state’s personal and corporate income taxes for 10 years or implementing a retirement tax to help pay for the state’s worst-in-the-nation pension debt. Here are the problems with that plan.
The typical career state worker collected $82,478 in annual pension benefits, recouping more income in 17 months of retirement than they contributed over 35 years. Working Illinoisans only earned $59,650 a year.
Just like Chicago Mayor Rahm Emanuel did late in his term, Mayor Lori Lightfoot is calling for public pension reforms. Pensions are damaging cities, she said.
The typical career state pensioner earns more in retirement than Illinoisans do working. Households now pay over three times more than they did nearly two decades ago to cover the costs.
Illinois’ five statewide pensions system saw their debt increase by nearly $10 billion to a grand total of $140 billion in fiscal year 2022. Pensions will cost the state nearly $11 billion next year, but that’s still $4.4 billion too little.
The Biden administration promised nearly $36 billion to stabilize pension plans for Teamsters nationwide after forecasts predicted the system’s default by 2026. Union members would have seen their retirement benefits slashed by 60% if the system defaulted.
A former CTA clerk was indicted on five counts of wire fraud for allegedly creating and approving 43 fraudulent benefit requests.
Illinois taxpayers spent $3.3 billion more on public pensions between 2017 and 2022 than state forecasts said they would. Had that money not evaporated, it could have paid to repave 150,000 miles of roads or for nearly 25,000 full-ride scholarships.
Chicago Mayor Lori Lightfoot earmarked $442 million to help pay down Chicago’s $46.9 billion pension debt. The Civic Federation said stop-gap measures will only delay future property tax hikes unless there’s statewide pension reform.
A new financial report predicts residents in the nation’s largest cities will pay more for pensions next year as inflation and recessionary fears “erase” 2021 gains. Chicago topped the big cities for pension debt.
Pension expert Richard Ennis analyzed public pension performance of 24 funds, finding the Teachers’ Retirement System of Illinois among the worst after underperforming for 10 years.
Published Aug. 17, 2022 Illinois is home to one of the worst pension crises in the country.1 At 39% funded, according to the nonpartisan Pew Charitable Trusts, Illinois has the worst pension funding ratio of any state.2 By contrast, neighboring Wisconsin’s pension system is 103% funded.3 In fiscal year 2022, Illinois’ total general funds pension...