SPRINGFIELD -- Members of the Illinois Retired Teachers Association are imploring Governor J.B. Pritzker to cease the decadeslong practice of not fully funding the pension systems. IRTA members appreciate the difficult fiscal condition that the governor inherited but taking pension holidays is not the solution.
"The Illinois Retired Teachers Association has serious concerns about the governor's proposed pension holiday," IRTA President Roger Hampton said. "We are supportive of the proposals to infuse additional revenues into the pension funds for solvency, but not to underfund systems by hundreds of millions of dollars or by raiding one fund to give more to another. Delaying pension payments just kicks the can down the road again and costs future generations of Illinois taxpayers (if any left) billions of dollars."
During his budget address Wednesday, Gov. Pritzker proposed allocating $4.237 billion into the Illinois Teachers' Retirement System -- $576,000,000 short of what is legally and ethically required to pay for the pension benefits of retired teachers and current teachers. It will result in reduced pension payments to TRS for years to come but will generate a nearly $150 billion in increased costs to Illinois taxpayers, including the 417,292 members of TRS.
"TRS is currently very poorly funded by actuarial standards at 40 percent of the assets needed for current benefits," IRTA Executive Director Jim Bachman said. "If Illinois had not taken pension holidays, like the ones being proposed, the cost of TRS would be $1.2 billion. The state is paying 400 percent more because of statutory underfunding and a history of pension holidays. The Illinois Retired Teachers do not believe that the solution to the poorly funded pension systems is to make them more poorly funded and to continue the tradition that got Illinois in this problem in the first place."
"The state of Illinois must keep its promises to the people, like retired teachers, that have always kept up their end of the bargain," Hampton concluded. "The state of Illinois must fund its pensions and retiree healthcare promises at levels that are both legally and ethically justified."
This pension holiday is for teachers outside of the city of Chicago. Pritzker did propose increasing the payments to the Chicago Teachers' Pension Fund.