CHICAGO – A new report from the Commission on Government Forecasting Accountability found that Illinois’ pension debt has increased to $130 billion in 2016, up 17 percent from 2015.
Illinois’ pension crisis continues to worsen despite the fact that pension costs now consume more than 25 percent of the state’s yearly budget.
Illinois households are now on the hook for $27,000 each in state pension debt, $4,000 more than last year. The new data come as state taxpayers are already suffering from one of the nation’s worst economic recoveries, one of the country’s highest unemployment rates and the nation’s highest property taxes.
The report also found that the state’s five pensions funds now have less than 38 cents on hand for every dollar needed today to pay out future benefits. According to Fitch Ratings, Illinois’ pension plans are the worst-off in the nation.
“Now more than ever, this shows that the state’s pension math doesn’t work,” said Ted Dabrowski, vice president of policy at the Illinois Policy Institute. “It doesn’t work for struggling taxpayers who are forced to pay more and more into the pension funds. It doesn’t work for the poor and disadvantaged who are seeing core services cut. And it doesn’t work for state workers whose retirements are at risk.
“Lawmakers have no excuse to continue ignoring Illinois’ crippling pension crisis. They can immediately implement reforms that don’t require changes to the Illinois Constitution, including putting all new government workers on 401(k)-style plans and providing optional self-managed accounts to existing workers.”
Taxpayers are already on the hook for more than $1 billion in extra contributions to the pension systems in 2018, which will result in greater cuts to core state services. Without reforms, these costs will only continue to rise, the Illinois Policy Institute said.
— From the Illinois Business Journal via the Illinois Policy Institute