There’s been a lot of back and forth in Springfield over the proposals being put forth by House Speaker Michael Madigan and Senate President John Cullerton to possibly reduce the state pension.
The pension crisis remains unresolved in Illinois, but lawmakers are now open to looking at some new ideas, including both Madigan and Cullerton’s proposals, to address the issue.
The total amount of debt currently sits at over $100 billion.
A new outline would mean good and bad news for state workers who would be asked to pay 1 percent less into their retirement but instead of a 3 percent annual compounded raise, those bumps would be based on half of the consumer price index. If inflation remains at 3 percent, raises would only be 1.5 percent.
Another popular idea being considered, would have the state increase its pension payments each year to help cover passed obligations. Once that’s paid off, the state would then put that money directly into the pension, comparable to making advanced payments on a mortgage payment to reduce overall costs.
Off the table ideas include an option to force retirees to choose between health insurance or smaller pension payments and raising the retirement age. Details of the entire plan are limited, but it is estimated to save the state about $145 billion.
Cullerten’s plan is expected to save the state about $134 billion and Madigan’s is expected to save about $163 million. There were hopes that one of the packages or another reform package would come up for a vote in Springfield in October, but the prospect of that is not looking favorable.
WGN-TV writer Judith Ruiz-Branch contributed to this story