Ruling on Chicago pension law expected Friday

July 21, 2015

A Cook County judge is expected to rule Friday on the legality of a 2014 pension law aimed at reforming two of Chicago’s underfunded city retirement systems.

CHICAGO (July 21, 2015) –  A Cook County judge is expected to rule Friday on the legality of a 2014 pension law aimed at reforming two of Chicago’s underfunded city retirement systems. While the pension law included some much-needed reforms, such as an increase in the retirement age, if upheld the law ultimately would put Chicago residents on the hook for millions of dollars of tax increases.

Pensions and legal experts with the nonpartisan Illinois Policy Institute are available for comment in the days leading up to the ruling, and immediately following the ruling.

The Illinois Policy Institute has researched the Chicago pension crisis in-depth. In 2014, the Institute released its own plan to fix Chicago’s pension system which was vetted by an actuary. The Institute’s plan would have immediately reduced the city’s pension debt by half and would not require tax increases.

Here are some facts about the 2014 Chicago pension law at issue in Friday’s ruling:

  • The 2014 Chicago pension law only affects two of the city’s retirement funds: the municipal workers’ and laborers’ pension systems.
  • The pension funds for police, firefighters, teachers, parks and transit workers are untouched by this law.
  • The municipal workers’ pension fund has just 41 cents in the bank for every $1 that has been promised in retirement benefits.
  • The laborers’ pension fund has just 64 cents in the bank for every $1 that has been promised in retirement benefits.
  • The pension debt from the two pension systems affected by the 2014 law represents just $8.3 billion in pension debt.
  • In total, Chicago residents are on the hook for more than $34 billion in pension debt, or roughly $33,000 per household.

When: Ruling is expected Friday, July 24

Experts: 

  • Ted Dabrowski, vice president of policy at Illinois Policy Institute
  • Jacob Huebert, senior attorney at the Liberty Justice Center, the Institute’s litigation arm

Additional details available online here: https://www.illinoispolicy.org/8-things-to-know-about-chicagos-pension-reform-law/

FOR INTERVIEWS, CONTACT: Diana Rickert or Nathaniel Hamilton 312-607-4977