With $300 billion state pension liability, lawmakers approve Tier III plan for one unit of Chicago government

[June 04, 2021] By Greg Bishop

(The Center Square) – Before lawmakers left Springfield this week after the end of the spring session, there hasn’t been much wholesale change to shore up the burden on taxpayers from growing public sector pension costs.

State Rep. Kelly Burke, D-Evergreen Park, did have one measure for Chicago Park District pensions. House Bill 417 brought a variety of changes, including bonding for paying pensions.

“They also create a Tier III for district employees where new employees will pay 11% of their salaries, instead of 9%, into the pension fund,” Burke said.

State Rep. Martin McLaughlin supported Burke’s bill, but said it neglects the statewide pension crunch as Democrats continue to pass new spending and new programs.

“Numbers don’t lie,” McLaughlin said. “Thirty years ago our pension cost made up 4% of our budget. Now it makes up almost 30% of our budget.”

This year’s $42 billion budget spends nearly $9.5 billion on the state’s pension funds.

The Barrington Hills Republican said lawmakers have to address pensions on all levels of government because taxpayers can only cover so much.

State Rep. Kelly Burke, D-Evergreen Park, and state Rep. Martin McLaughlin, R-Barrington Hills, debate House Bill 417 Monday. 

“Why should this be incredibly important to my democratic friends on the other side of the aisle? You are constantly proposing spending programs, social programs, healthcare programs,” McLaughlin said.

Meanwhile, municipalities across the state continue to grapple with increased pension costs. In Springfield, Budget Director Bill McCarty told the city council the problem makes it difficult to provide basic services or hire new police officers or public works crews.

“That’s where that money’s got to come from, or it’s new revenue,” McCarty said Tuesday. “It’s basic math.”

Springfield used almost all of its share of property taxes to pay pension costs. Other municipalities across the state do the same. Some have had to cut services to cover pension costs.