This week the City of Chicago released its Annual Financial Analysis for 2014. According to an executive order issued by Mayor Rahm Emanuel on May 20, 2011, the Office of Budget and Management is mandated to produce a financial analysis of the City budget by July 31st of each year. The report includes: A financial condition analysis that covers the previous ten years, including a discussion of key factors impacting the performance of the City’s revenue streams; A three-year baseline…
This article discuses an upcoming $550 million contribution to the City of Chicago’s police and fire pension funds. The City’s 2014 Annual Financial Analysis, released July 31, interprets language in the 2011 pension law such that the increased contribution is not payable until 2016. The Civic Federation said this gives the City 16 months to negotiate and pass a pension deal before difficult tax hikes or spending cuts are needed.
This article discusses the City of Chicago’s 2014 Annual Financial Analysis released July 31, which reviews 2014 and includes projections for fiscal years 2015 through 2017. The Civic Federation said the City is making significant progress on managing its finances and reducing the structural deficit, but continued progress is threatened by the failure to address the City’s police and fire pension funding crises.
UPDATE: In addition to the Teachers’ Retirement System (TRS), two other large State of Illinois pension funds have also lowered their assumed rates of return on investment. Both the State Universities Retirement System (SURS) and the State Employees’ Retirement System (SERS) recently reduced their assumed investment rates of return from 7.75% to 7.25%. SURS took the action on June 13, 2014, according to a spokeswoman for the retirement system, while documents show that SERS made the decision…
This article discusses the relationship between property taxes, politics and Chicago’s drastic unfunded pension liabilities. Governor Quinn vowed to veto an early version of a pension reform bill for two of Chicago’s pension funds that mandated property tax increases, but has since signed a revised version that removed the provision. The Civic Federation said it is unclear how Chicago could restore adequate funding to its pension system without additional property tax revenues being one part of…
This article covers the pension reform bill for two Chicago pension funds that Governor Quinn signed into law on the June 9 deadline. It was unclear until his signature whether the Governor would support the bill passed by the Illinois General Assembly in early April. The Civic Federation said the reforms are a critical first step in addressing the City’s pension funding crisis, but even more challenging work remains to stabilize the Chicago Police, Fire and Teachers pension funds.
State statute governs all benefits and funding of public pensions for the City of Chicago. The City cannot contribute more to its pensions than the multiple of employee contributions allowed under state statute. There has unfortunately been some confusion in the media on this point ahead of a Monday, June 9th deadline for Governor Quinn to sign into law pension reforms for the City of Chicago’s Municipal and Laborers’ Funds. Eight local government pension funds in the Chicago area, including…
On May 28, 2014, The Civic Federation sent this letter to Representitive Elaine Nekritz and the members of the House Personnel and Pensions Committee in advance of a 4 p.m. hearing on House Bill 1154. The Civic Federation commends Cook County Board President Toni Preckwinkle, Cook County Commissioner Bridget Gainer and Cook County Chief Financial Officer Ivan Samstein for their work to assemble a comprehensive reform framework to address Cook County and the Forest Preserve District’s pension…
This op-ed by Reboot Illinois Chief Operating Officer Madeleine Doubek warns that the potential property tax increase associated with reforms for two of Chicago’s four pension funds is just one example of several local underfunded pension funds that could require additional revenue from increased property taxes. The Civic Federation said the problem is not unique to Chicago—communities across the state are taking full advantage of their property tax levies for pensions and are still struggling…
This article covers the Cook County pension reform legislation that passed the Illinois Senate May 27 and is awaiting a vote in the House. The Civic Federation said the proposal is a step in the right direction for the fund that is currently on track to be insolvent by 2038, but the plan lacks a full public actuarial analysis and it is unclear how the County will cover its increased contribution.
