If an Illinois worker takes a pay cut during a recession, she knows the state isn’t going to take an even bigger chunk out of her paycheck. That’s because the state income tax rate stays the same. But if her home loses value, too, she could still see her property tax bill go up. Government...View Report
Pension funds aren’t immune to the volatility of the stock market. Even before Brexit, Moody’s warned that low investment returns are already putting Chicago’s pension funds at risk. A major stock market correction or another recession just might put Chicago and CPS over the edge if their already-underfunded pension systems collapse.
The state must get its financial affairs in order by allowing municipal bankruptcy and enacting real pension reforms.
Gov. Bruce Rauner and Republican state lawmakers have proposed bankruptcy for Chicago Public Schools; Mayor Rahm Emanuel has rejected the idea of bankruptcy, repeating his demand that Illinois taxpayers bail out the struggling school district.
If the White House wants to give Puerto Rico the right to bankruptcy, it should extend the option to all states and territories.
Where is the school district going to get $1.1 billion? The state? Think again.
Local governments should structure themselves in a way that best meets the needs of their budget, taxpayers and public employees. And the state should give them the power to do so.
A federal judge approved Detroit’s historic Chapter 9 bankruptcy, allowing the city to shave off $7 billion in liabilities from a total debt of $18 billion.
It’s ironic that Detroit government workers and pensioners, on the one-year anniversary of the Motor City’s bankruptcy, have voted to cut their own pensions. Their vote is part of a “grand bargain” bankruptcy restructuring that seeks private, philanthropic and state funds to help avoid massive cuts in government pensions. The bargain reduces Detroit’s debt by...
The California city of Stockton’s bankruptcy case took an interesting turn yesterday. The big question surrounding the city’s bankruptcy has always been what might happen to city employee pensions. Most government advocates assumed that these pensions would remain untouched no matter what happened to Stockton’s finances. Now the federal judge in charge of the bankruptcy...
Yet another city is heading toward bankruptcy. Desert Hot Springs, Calif., a city of 26,000 in the south-central part of the state, warned it could run out of money as soon as March 2014. If that occurs, the city could be forced to file for bankruptcy. If that happens, Desert Hot Springs will be the...