Massive increases in public safety pension contributions have failed to keep Oak Lawn’s credit from being downgraded to junk status. The Chicago suburb’s leaders are fighting cuts and tax increases, which are inevitable without pension reform in Springfield.
East St. Louis is short $9.5 million between a budget deficit and back payments owed to its fire and police pensions. As a result, city leaders are closing a firehouse and laying off nine firefighters.
East St. Louis already faces a $2.2 million state funding diversion for its firefighters pension fund. Now the police pension board is demanding $1.79 million the city owes that fund.
The southwestern Illinois city faces high crime and poverty rates, as well as a $5.5 million budget deficit. Now, $2.2 million owed to its firefighters pension threatens to halt the flow of state funds.
Avenues for state oversight for cities with financial difficulties have limited utility in the face of massive pension debt and have almost never been invoked since Springfield passed them into law in 1990.
Chicago’s $1.15 billion projected budget gap is the latest in a decades-long string of structural deficits. Making Chicago’s high taxes worse is not the solution.