Rhode Island recently reached a potential settlement agreement with most employee and retiree groups involved in litigation against its 2011 landmark pension reforms. The details of the agreement became available on April 13, 2015 through a court filing that was one of several steps necessary for the settlement to be finalized. The settlement averts a trial that had been scheduled to start later this month. The proposed agreement comes nearly a year after a previous settlement was rejected…
This article discusses a warning by credit rating agency S&P that the City of Chicago could face further credit rating downgrades this year without the enactment of substantial pension reform legislation. The Civic Federation is cited on the steep projected increase in 2015 for the City's required contribution to its Police and Fire Pension Funds.
This article looks at both mayoral candidates’ proposals for addressing the City of Chicago’s financial challenges, which include severely underfunded pension funds, a high debt level and Chicago Public Schools’ $1 billion deficit. The Civic Federation said that even after pension fund reforms it is hard to see how these liabilities could be fully addressed without future property tax increases.
This article covers the Illinois Supreme Court’s consideration on March 11 of oral arguments for the State’s pension reform law. The court took the case under advisement. The Civic Federation said that if the court does not find the pension reforms constitutional, it should provide direction on how the State could maintain the current system without debilitating service cuts or extreme tax hikes.
Governor Bruce Rauner’s recommended budget for fiscal year 2016 includes a new plan for reducing the State of Illinois’ massive pension costs. As discussed here, the plan could cut the State’s unfunded pension liability by approximately $25 billion and save $2.2 billion on pension contributions from general operating funds in FY2016, according to the budget proposal. Proposed legislation on the plan has not yet been filed and the actuarial analysis that was used to generate the savings…
This editorial discusses the significant financial challenges the City of Chicago is facing related to unfunded pension liabilities and debt levels. The editorial cites Civic Federation research and discusses recent reforms to the City’s Municipal and Laborers’ pension funds, saying the City’s Police and Fire pension funds will likely require similar reforms.
Two lawsuits seeking to overturn a pension reform law for the Chicago Municipal and Laborers’ funds have been put on hold pending the outcome of State pension litigation at the Illinois Supreme Court. Oral arguments for the State pension case have been scheduled for March 11, 2015. In December 2014, two lawsuits were filed in Cook County Circuit Court that challenge the constitutionality of pension reforms for the Chicago Municipal and Laborers’ funds that were signed into law in June 2014.…
In his first budget proposal for the State of Illinois, Governor Bruce Rauner recommended more than $4 billion in spending cuts and $2.2 billion in estimated pension savings to close a projected budget gap of over $6 billion in fiscal year 2016. The proposed $31.5 billion General Funds budget, issued on February 18, 2015, has steep cuts to many programs, including Medicaid and human services, and reduces State support for public universities, local governments and transit districts. Areas…
The Civic Federation’s previous blog examined the long-term debt of eight major local governments in northeastern Illinois. This blog explores the unfunded pension liabilities of ten pension funds sponsored by local governments in the Chicago area using a per capita indicator based on unfunded pension liabilities. Between FY2004 and FY2013, pension obligations per capita for Chicagoans’ increased by 199.4%, rising from $4,305 to $12,889. For Chicago residents, the pension obligations per capita…
In a report released today, the Civic Federation’s Institute for Illinois’ Fiscal Sustainability proposes a comprehensive five-year plan that responds to the dire reality of Illinois’ financial condition with painful, but necessary recommendations. The plan immediately stabilizes the State’s operating budget and establishes a sustainable long-term financial plan that would pay off Illinois’ unpaid bill backlog of approximately $6.4 billion. The full 56-page report is available here. Nearly…
