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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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“Chicago is currently adhering to a non-actuarial ramp with set payments laid out in statute through 2020 when an actuarial contribution then hits for police and firefighters and through 2022 when it hits for municipal and laborers.”
That’s the result of the General Assembly overriding Governor Rauner’s veto of SB 777, creating PA 99-0506 effective May 30, 2016.
PA 099-0506 is what is responsible for my leaving Chicago. In one of the city’s bond offerings they laid out what the contribution amounts will be under an actuarially required contribution, and the numbers are staggeringly bad. Too bad everyone looked at me like I was crazy, because now those that failed to heed my advice are complaining about property taxes. And you ain’t seen nothing yet.
PA 99-0506 changed employer contributions to the Chicago Police and Chicago Fire pension funds.
Employer contributions to the Chicago Laborers (LABF) and Chicago Municipal (MEABF) changed when the General Assembly overrode Governor Rauner’s veto of SB 42 on July 6, 2017, resulting in PA 100-0023.
http://www.civicfed.org/civic-federation/blog/chicago-municipal-and-laborers-pension-funding-changes-approved-part-state
The required employer contributions to the five state pension funds (TRS, SURS, SERS, JRS, GARS) during the 15 year ramp period (Edgar Ramp) of the 50 year funding schedule in Public Act 88-0593 were also non-actuarial. In Illinois pension vernacular, required employer contributions to pension funds described as ramps and holidays are non-actuarial. Illinois state law mandated many such non-actuarial employer contributions to many pension funds over the decades. In such instances the state law intentionally ignored actuarial recommendations. Yet for decades rather than emphasizing that fact, employers, politicians, and the press often would proclaim the required employer contribution was… Read more »
And according to some (not WirePoints) the Illinois State Constitution protects the Ponzi Scheme, which in turn is protected by the US Constitution.
Full pension contributions less than actuarial required, the Illinois Pension Ponzi Scheme, and state and Federal constitutional law, politics, and the media from the Land of Lincoln.
So much intrigue.
Will the US Constitution protect Squeezy the Pension Python.