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I wonder if they will do as CA did and lay off 27,000 teachers or maybe save a bundle by giving career teachers a retirement check for $1,000,000 each rather than their pension.
After Blogo and now Dorsal Fin Quinn we need to vote a new group into office. Anyone who says to stop throwing money at the Peotone Airport will be a front runner for my vote. If things are bad now image how building a airport whos hanger space will only be wanted by guys with ultralights drain our state coffers.
Not sure how much the planes cost but in the scheme of things they are a relative drop in the bucket.
If you want to talk about budget problems you need to look at where the big money is going. And right now it is in generous pensions and health care for current and retired state and municipal employees.
Until something is done about that Illinois will continue to have budget issues.
If I were Quinn I wouldn't be comparing us to California. In some ways are situation is worse than Californias. First, they have made some efforts to get their budget under control. They pass balanced budgets . They rose taxes and made cut backs.
In Illinois we keep passing the buck waiting for things to get better. There is no leadership on this from either party.
Pension crisis appears to be due to 10 years of the State failing to fund the pension obligation.
Interestingly the report notes that Illinois pension fund is more affordable than most comparable positions in private companies. Also 78% of Illinois employees do not receive social security benefits as they are non participants- that alone saves us somewhere above the 6% that would be required to be paid into SS.
But 10 years of underfunding with the subsequent lost investment returns..........Yeah we've got a crisis. Of course they would rather you believe it's bloated pensions that are the problem rather than the lawmakers raiding the pension to pay for pork year after year after year.
State employees contribute roughly 7% percent of their income to their pensions. The State kicks or local governments kick in another 7% . So roughly this is equivalent to Social Security.
Now compare SS benefits to state pensions. Social Security You cannot start drawing until your sixty two, and not fully till you're seventy . State or Local Pensions can be drawn as early as fifty. Police and Fire pensions can be drawn at the age of fifty one reason that GE had to raise taxes.
Other state employees can draw their pensions starting after thirty years of service. They are usually given a guaranteed start of seventy five percent of their base salary. Plus COLA increases.
So for the same amount of SS government employees have far greater pension benefits.
And SS is expected to drawing down on its fund in 2016 and going broke in 2034.
Also Teachers and other employees can still join 401K like systems as well.
As for the State and its politicians not fully funding the pension true. But that is done because if the full cost of the pensions were paid for then taxes would have to go up dramatically. None of the contributions from employees or employers was touched.
So these are political decisions probably done with the blessing of the various unions. Who don't everyone to know the real costs of these pensions.
BTW this is not strictly an Illinois problem.
California is having serious problems funding its pensions. The Mayor of Detroit has suggested filing for bankruptcy because of its large pension obligations. Pittsburgh was considering taxing college students to help it fund its Pension obligations. Oakland is using private contractors to replace police since it takes 250K to put a police officer on the street vs. 50K for a contractor. Mesa Arizona is using contractors for its CSI type work for the same reason.
Illinois has over 80B in unfunded pensions. The pensions for the top one hundred recipients, ninety nine of them school administrators will cost 600M over the next twenty years.
In little more than a year Chicago spent over 1B from its parking meter lease mostly to fund its pension and salary obligations. Eighty percent of Chicago's budget goes to personal costs.
"Facts don't cease to exist because they're ignored"
? Page 154 says that the cost of a new teacher to the taxpayers in pension is 5.4%. Pus the average private complany match in a 401K is 3%- it's 0% for public emplyees. Pus we don't pay the employer's 6% share into SS. Seems like a pretty good deal even with a few sweetheart buyouts (which is not exactly something the private sector doesn't do for certain employees LOL). Fire and police are the only employees I'm aware of the can retire at 50. Sometimes public employers buy out expensive employees when deemed necessary but again- private does that also. If done right it reduces payroll cost.
Also you mixing local and State employees. The State does not contribute to municipal employee retirement. And all taxpayers pay for State employees- not local government.
$80 Billion in unfunded pensions should be criminal (actually the State was sued over this). Think of the $ lost in investments over all those years. Plus the fact that we have to come up with the $. And now we're whining because the bill is coming due? Thanks elected officials!
I got a real kick out of this B.S., taken from a letter written by some rube named Raymond Poe, 99th District to a member of this pension modernization task force.
It is on page 155.
quote:
So how do we effectively address our embattled pension system? Some have suggested a shift to a state-employee 401(k)-style plan as a way out of this financial mess. While this approach has been popular with private sector employers, we remain mindful that there are distinguishable differences between public and private-sector employment.
While private sector employers are often motivated by financial gain, public sector employers like the State of Illinois are bound by the constitution to serve the public and eliminate poverty.
In other words, public sector people have zero "financial gain" motivation and are all sweetness, honor and high ideals. Therefore, they DESERVE all this pension largesse.
Just ask Blago or George Ryan. They are in the Eliminate Poverty - THEIR OWN! - Hall of Fame.
Because we all know how great 401k's are- biggest rip-off ever played on American society- almost all your profit will go for fees long-term. They were never meant to replace the pension. Nothing like paying people fees when they lose your money in a bad year -employer and employee. One big eight ball to be behind.
Still-what he's getting at is profit sharing- stock, bonus, 401 match, check (if you're part owner). None of it exists in the public sector.
At sixty two, you get so much, at sixty you get more at seventy you get the most. Essentially seventy is full retirement.
Most financial planners advise to wait as long as possible to start collecting SS since you'll get more. Though of course if you die at seventy one I guess you lose.
Ever been to Emmitsburg, Maryland to see the wall of firefighters who died in service? Or do you even appreciate the way cops go in harms way? That's the vast majority of government workers who get to retire early. I say they deserve it. Apparently you don't.
Like other gov. employees with hazardous jobs- they deserve early retirement. I was responding to Shore's comment that we're actually on the same page with this.
Police and Fire Fighter Jobs are nowhere near the top list of hazardous occupations.
Aside from large urban environments most police work is not physically dangerous.
You can make the case for Military early retirement not only because of its occasionally hazardous in nature but also because of the long separations and frequent moves make it a very difficult career choice.
Could be though Shore- Not sure if it's 50 or 50's but like the military, they deserve it.