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Lightfoot called the 3 percent COLAs built into public employee pensions "unsustainable" and implied Illinois needs a constitutional amendment to fix a broken system. She was right. Too bad she had to take it back.
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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COLA’s are not the highest priority in pension reform. Reducing the service year multiplier upon which the initial pension is calculated from 2.2 to 2 would add 3 years to reach full vesting, which is 3 more years of employee contributions and 3 less years of employees drawing a pension. The initial pension amount would be higher due to higher salaries, but that should be offset by the added service years and the trickle down effect on all pensions. Also, I would not allow pension participants to accumulate sick days and count it towards serviceable pension years. Sick days should… Read more »