Illinoisans are feeling the pain of growing pension costs. Pension payments account for more than 25 percent of the state’s general fund spending each year. One of the few bright spots of Illinois’ spending plan for fiscal year 2019 were new restrictions on “pension spiking” – the practice of hiking an employee’s end-of-career salary to increase his or her lifetime pension benefits. The new provision lowered the cap on end-of-career salary increases to 3 percent of salary from 6 percent.
Pension spiking for employees enrolled in the Illinois Teachers’ Retirement System, or TRS, has long been a problem in Illinois school districts. Unfortunately, some lawmakers want to eliminate taxpayers’ new protection from these abuses before it has the chance to have an impact.
Senate Bill 3622, filed July 25 by state Sen. Dale Fowler, R-Harrisburg, would undo the recently enacted 3 percent cap on pension spiking.
While some claim pension spiking can be an important tool for attracting talent, pension benefits for TRS participants are already extremely generous. An Illinois Policy Institute report found that the average recently retired career teacher in Illinois receives a $73,300 annual pension benefit and can expect a total of $2.2 million in lifetime benefits.
Sign the petition today to tell your lawmaker to oppose reversing the cap on pension spiking.