Illinois’ worst-in-the-nation pension debt shrank slightly after investments more than tripled predictions, thanks partly to COVID-19 stimulus. Experts caution 1 year cannot undo decades of overpromising and underfunding.

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.

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.