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Summary and audio linked here.
Chicago’s political leadership is floating a pension buyout program as evidence it is seriously addressing the city’s thirty-six-billion-dollar unfunded pension liability, but Mark Glennon, founder of the Illinois policy research organization Wirepoints, said that the proposal moves debt from one column to another rather than reducing it, and that the broader fiscal picture facing the city continues to deteriorate across every measurable dimension. Audio here.
Expect no retraction or apology. This what they do.
The state’s existing buyout program for its own pensions is the precedent for Chicago, which should be a warning: Look out for similar exaggerated claims and shoddy analysis.
Full interview and summary linked here.
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There are public entities that are still using Covid funds to balance next year’s budget. Those funds are running out and either service cuts get made or the money is going to need to come from somewhere. The ratings agencies seem to be ignoring reality.
“The ratings agencies seem to be ignoring reality.” How are the rating agencies “ignoring reality” when they are the same ones stating that the city needs a “revenue strategy” to continue improvements in their ratings? “While the city has made some important progress on the expenditure side, the new mayor’s first budget didn’t make similar strides on the revenue side, according to Fitch Ratings, which upgraded Chicago’s general obligation debt to BBB-plus from BBB in October. For example, the budget didn’t include raising the property tax levy to account for inflation”“Chicago’s credit quality “is heavily pressured by its expenditure burden… Read more »