The mayor’s Chicago budget plan includes a $76.5 million property tax hike despite $3.5 billion in federal aid and funds permanent programs with temporary revenues but includes no push to fix pensions.View Report
A new report from watchdog Truth in Accounting shows each taxpayer’s share of state debt has nearly doubled since 2009 to $57,000 as total debt increased by $10 billion—mostly due to pension obligations.
Pension obligation bonds, like payday loans, are a sign of mismanaged finances. Illinois not only leads the nation for using that risky debt, it owes the bulk of it.
Pension debt is a record $144.2 billion while Illinois’ short-term debt is on track to reach $22 billion in three years, exceeding the record $16.7 billion hit during the budget impasse.
S&P Global Ratings said Illinois’ public pension systems are in trouble, and will get worse thanks to the Illinois Exodus and because state leaders refuse to fix the problems.
Fiscal watchdog Truth in Accounting’s July 2021 report showed the Windy City’s pension-fueled debt rose by $2.3 billion from 2019 to 2020 despite receiving substantial federal aid during the pandemic.
Pritzker borrowed during the pandemic rather than making responsible budget decisions. So Illinois’ federal relief must repay debt rather than helping businesses recover like other states.
Chicago had planned to use half of its federal relief funds to pay down pandemic debts, but new federal guidance may prevent that. Regardless, without pension reform the city will continue drowning in debt.
Under a new proposal, the city of Chicago would issue debit cards to 5,000 low-income residents that provide $500 each month for a year using some of its COVID-19 relief money.
Illinois worst-in-the-nation public pension debt grew 19% year over year. It will continue hurting the state economy and job growth, driving more people out of Illinois, unless there are reforms.
A new report from government finance watchdog Truth in Accounting gave the Windy City an “F” for financial health. Chicago’s massive $36 billion net debt stems primarily from pensions.