Proposal to consolidate lawmaker pensions with other funds to be discussed this summer

[May 23, 2023]  By Andrew Hensel | The Center Square

(The Center Square) – Illinois lawmakers will have to wait for the next legislative session to address pension measures currently in the General Assembly.

Two pension-related measures await action in the legislature. House Bill 4098 would discontinue the General Assembly Retirement System, the worst funded of the state's five systems, and the Judges' Retirement System and would allow for future members to be offered enrollment into the existing State Employees' Retirement System.

House Bill 4099 would adjust the pension age for individuals who provide various security duties for the state of Illinois.

The measures will be worked on over the summer, according to state Rep. Steven Reick, R-Woodstock.

"We are not obviously going to vote on it [this session], but what we are planning on doing is doing a series of subject matter hearings over the summer to kind of bring it out and discuss it," Reick told The Center Square. "I think there are nine or 10 separate aspects to [HB4098]."

Reick said the goal of the proposals is to bring the state to conformity with the nation's Employee Retirement Income Security Act.

"What we are trying to do with this bill is basically bring Tier 2 into conformity with safe harbor provisions of ERISA," Reick said. "Which we have been out of compliance with since 2012."

The Illinois State Capitol May 2023
Greg Bishop / The Center Square

More than a decade ago, Illinois enacted a second tier pension with fewer benefits for state employees hired after 2011. In 2012, the total unfunded liability was around $97 billion. For 2021, an audit showed the total unfunded liability for all funds of around $140 billion. The GARS fund is only 16.9% funded.

The two measures filed in Springfield this year could be worked into one larger measure depending on how the discussions go this summer.

"That will be something we will work on over the summer and have a lot of talk about it," Reick said. "Hopefully, we will come up with a bill that we can get through the legislature and to the governor's desk."

Earlier this year, Gov. J.B. Pritzker introduced his budget proposal and said he plans $200 million more than the statutorily required contribution of $9.8 billion for pensions, for a total of $10 billion. Since Pritzker's February budget was introduced, however, state revenue took a large dip in April with taxes collected $1.8 billion less than April 2022.

Pritzker's annual budget proposal would spend nearly $50 billion in total for the fiscal year that begins July 1, but still, the budget has yet to be approved by lawmakers. They return Wednesday.

Andrew Hensel reports on issues in Chicago and Statewide. He has been with The Center Square News since April of 2021 and was previously with The Joliet Slammers.