TAYLORVILLE - This list of Christian County’s top pension recipients was released today by Taxpayers United of America. The list includes annual pensions, total employee contributions, pension paid out to date and estimated lifetime payouts based on life expectancy of 85. Courtesy of Taxpayers United of America
TAYLORVILLE - The first semblance of a plan aimed at solving a $95 billion pension funding shortfall seems to be taking form in the Illinois State Legislature.
Representative Elaine Nektriz (D-Northbrook) unveiled a proposal today that would increase the financial obligation of state pension recipients and reduce costs of living increases, while also ensuring that the state meets its own funding obligations to the 5 pension programs.
An article in the Peoria Journal Star today stated that a summary of the new proposal would allow for “the intercept of other state funds” and the use of the court system to help meet funding requirements.
The Journal Star also stated that like previous legislation introduced earlier this year the bill would gradually shift the cost of teacher and university pensions over to school districts and colleges. Lawmakers have voiced concern in the past about shifting funding obligations to downstate school districts that are already experiencing financial hardships.
No details for the unnamed bill have appeared as of press time today.
Yet, an Associated Press article today stated “the proposal would have to overcome lingering partisan divisions over the issue in Springfield, and it was unclear if it would get the support of Gov. Pat Quinn and Democratic legislative leaders who hope to have a solution in the works for the Legislature’s planned lame-duck session in January.”
Illinois Senate President John Cullerton says the plan appears to impose unilateral cuts to benefits, which he believes the Illinois Constitution prohibits.
Before today, state efforts for pension reform had been embodied by a cartoon python named Squeezy, Illinois Governor Pat Quinn’s chosen figurehead in the marketing push for state pension reform. The state’s management of, and response to what some say could be a $200 billion plus pension funding hole under new accounting rules has been nothing less than animated.
The reality, however, of the situation is not the stuff of cartoons. The figures associated with the pension shortfall paint a desperate scenario for Illinois taxpayers.
Taxpayers United of America President Jim Tobin was in Taylorville on Tuesday to discuss the TUA’s stance on the pension funding shortfall. In a written press release distributed by Tobin the TUA had this to say about the status of pension funding in Illinois.
“While taxpayers across Christian County face crushing tax increases, falling home values, rising unemployment, and a painfully slow economic recovery, government employees continue to receive stunning pensions largely funded by taxpayers who will never collect more than $22,000 a year from social security.”
The TUA and other groups, including a Chicago based com
mittee run by former State Attorney General Tyrone Fahner, have said the current system is unsustainable - the TUA uses the term “mathematically impossible”.
Numbers compiled through the Illinois Policy Institute and recent news articles suggest a situation that could be far worse than previously imagined.
By The Numbers:
95 - $95 Billion dollars is estimated to be the current unfunded pension liability in the State of Illinois. That figure ballooned 14 percent from last year’s $82.9 Billion dollar liability. (Illinois Policy Institute)
209 - Under new accounting rules the actual accrued debt of Illinois’ pension funding programs will look to be around $209 Billion. The Illinois Policy Institute states on their website www.illlinoispolicy.org that “The state’s five pension funds officially report $146 billion in accrued liabilities for earned benefits. But $146 billion is not the amount of money that the state will actually payout for those benefits. Instead, $146 billion is the money that the state should have in the bank today to earn enough investment income to pay out earned benefits.” The report goes on to say that “State and local taxpayers are on the hook for far more than the pension debt owed by the state’s five pension funds. The state also owes $54 billion in unfunded retiree health benefits and another $15 billion the state borrowed to make its annual pension payments and shore up investment losses.
632 - Under the current system Illinois will spend more than $632 billion dollars for pension benefits between now and 2045. (Illinois Policy Institute)
1 - Illinois’ estimated total pension pay out in all 5 state pension programs is set to increase from $5.9 billion to 6.8 billion in the next fiscal year, an increase of nearly $1 billion dollars. (Illinois Policy Institute)
19 - The per-annual percentage of return on pension fund investments that the state would need to cover pension costs. The State predicts it’s return on pension funds this year to be between 7 and 8.5 percent. (Illinois Policy Institute)
40 - The percentage of the state’s general revenue that will be required to keep the pension fund going by 2020, according to former Illinois Attorney General Tyrone Fahner. (State Journal-Register article, November 14, 2012.)
25,000 - The number of State retirees projected to collect six-figure pensions 8 years from now. 6,700 retirees currently collect a six-figure pension (Taxpayers United of America)
3 and 25 - State retirees see an annual 3 percent increase in pension benefits to offset cost of living increases. That 3 percent increase will double the payout of a pension over a 25 year period.
The TUA has proposed broad measures that include employee contribution levels similar to those in place in Wisconsin.
“Without sweeping and immediate reform that includes raising retirement age to 67, increasing employee contributions by 10%, increasing healthcare contributions to 50%, and replacing the defined benefit system with a defined contribution system for all new hires, Illinois’ pension system will collapse” said the TUA press release. “It’s mathematically impossible to tax your way out of this problem.”
The TUA included with their press release a list of the top pension recipients in Christian County. That list includes annual pensions, total employee contributions, pension paid out to date, estimated lifetime payouts (based on life expectancy of 85), and the percentage of employee contributions to lifetime payout.
The top estimated lifetime pension payout in Christian County is $3,781,030.00 for a retired superintendent of schools. Number two is a retired principal at $3,718,883.00. No one in Christian County is taking home a six-figure annual pension, but the highest annual payout is close at $95,794.00.
In comparison Sangamon County’s top pension recipient currently stands to receive an estimated lifetime payout of over $7 million. Of the top 25 pension recipients in Sangamon County only 9 are receiving an annual pension of less than $100,000 with the top annual payout of $153,456.00 going to a retired superintendent of Ball Chatham CUSD 5.
Categorized lists of Illinois’ highest paid pensions are available at www.taxpayersunited.org.