Illinois Pensions Reviewed
Police & Firefighter Pension Consolidation
"After eight months of data collection, analysis, and many meetings, the Task Force recommends the State take the following actions:
STEP 1: Consolidate suburban & downstate police & fire pension plan assets...
STEP 2: Review consolidation of suburban/downstate police & fire pension plan benefit administration; review of other state and local plans to determine advantages of consolidation...
The issues surrounding pension funding in Illinois have been decades in the making. Underinvestment, overly optimistic projections, and the required trade-offs with other critical public services all place great pressure on the financial health of retirement systems. The State and local governments are now faced with limited options to remedy these issues."
Other Pension Studies & Reports
"Underfunded pensions occur when promised pension benefits are not backed with an adequate amount of assets (Inman, 1986). This situation can occur for a variety of reasons. For example, pensions may be underfunded because investment returns fall short of expectations, or actuarial assumptions about factors such as participant mortality rates may differ from reality (Coggburn and Kearney, 2010). Alternatively, elected officials may choose to deliberately underfund pension plans to save money in the short-term (Thorn and Randazzo 2015; Smith, 1981). Deliberate underfunding can be dangerous to governments and their residents as it is essentially “borrowing against the future” but can go unnoticed (Mitchell & Smith, 1994: 278)."
"The Pew Charitable Trusts conducted a comprehensive 50-state review of state constitutions, statutes, and case law to determine the level of legal protection for not only public employee pensions—a monetary annuity paid throughout the lives of retired employees and often to a surviving spouse as well—but also retirement health care plans. Pew’s research examined the annuity and health care benefits separately because the law in most states treats the two differently. The research also focused on the legal rights of current employees and retirees because retirement benefits can be modified for new employees prior to their date of hire."
"I had a lengthy visit the other day with a man in search of redemption. That would be John Filan, who was Mr. Blagojevich's chief financial officer and sold him on the POB. The big borrowing actually worked, it's a success and the numbers are there to prove it, says Mr. Filan, presenting a stack of papers and charts and data-based scenarios."
Illinois Pension Laws & Litigation
"The Supreme Court’s opinion in In re Pension Litigation, is extraordinary in its depth and analysis, and goes well beyond the briefs filed by any party, exploring the trial court record, and public document. It was a 7-0 opinion, and it was decisive. It is highly unlikely that the Supreme Court will reverse itself at any time in the near future if ever." (footnoted omitted)