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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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Whatever we do, let’s not reduce the pensions and health care benefits of current retirees, because, you know, they “earned” those benefits and were promised them. Those are the people, especially teachers, who retired in their 50s and will live 30-40 more years with free health care benefits and pensions well in the six figures. What a massive abuse of the IL taxpayer!
Let’s say the Tier 2 pension fix is either reducing the employee contribution rate or the # of years to full vesting. Shouldn’t we have the actuaries that calculate the unfunded pension liabilities for all 5 state pension funds start including these Tier 2 “fixes” in their liability calculations? THat would be a nice chart to see in a CAFR.
Because Hynes and Co who are pushing POB’s and re-amortization are basing all their bogus numbers on the assumption that Tier 2 will remain as-is forever.
Absolutely. That or something like it. That’s probably why Tier 3 has stalled. It’s intended to be a sort of fix and a replacement for Tier 2s to opt into. It was passed last year but follow-up legislation is needed to get it implemented. We’ve always suspected it would cost more and a good analysis of that was never released. In any event, the cost of fixing Tier 2 is being hidden.